Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.

Lot's cooking in Germany

by whataboutbob Wed Sep 28th, 2005 at 11:13:33 AM EST

There's so much going on in Germany right now that it is diffficult to know where to start. As Fran mentioned in the European Breakfast this morning, German business has shown improved confidence (though this information was gathered before the election). Today we have the 2nd round of SP-CDU talks taking place which is beginning to look as though Schroeder might give in (will he?).

And from the Independent yesterday the new national Germany "Feel Good" campaign was kicked off, in which:

Germany's mass media have launched an extraordinary 30m (20m) "feelgood" campaign designed to banish the nation's political and economic blues. (...)"Admittedly, we Germans like moaning and we always look for the hair in the soup," said Peter Steinke, of the Frankfurter Rundschau newspaper. But he squarely blamed the country's business leaders and politicians for the pessimistic national mood. "They kept saying we are living above our means, we have to tighten our belts, we can't compete, we are at the bottom of the pile," he said. "It's like the boss who tells his employee he is too expensive and will probably be fired and then wonders why he isn't motivated"

But Katarina Witt's makes this stirring exhortation in one ad: "Don't ask what others can do for you. You are the others. You are Germany!"

And finally, from BBC last week Will the "Locusts" trigger a German recovery?


Perhaps the most outrageous attack on foreign investors came during the state election campaign in North Rhein-Westphalia in spring, when SPD chairman Franz Muntefering compared foreign private equity investors with an invasion of "locusts" stripping companies bare.

But suspicions against the hedge funds and private equity investors that have recently flooded into Germany are not confined to those on the political left.

"They just gear up the companies to 90% leverage or something like that," says a former manufacturing consultant in Germany's industrial heartland North Rhein-Westphalia, now working for a property investment fund in Dusseldorf .

"And they don't care about the people working for the companies." And the employees who find themselves in the firing line include the companies' executives, many of whom feel threatened by investors with Anglo-American agendas.

Many of them are concerned about the way their industrial power is being taken a way from them, and there is much evidence to suggest they have reason to worry.

To be fair and balanced here, there are investors who are working with German businesses in good ways:

...not all private equity firms ride roughshod over their staff. Many are quite prepared to go along with the German corporate governance norm, where workers are represented on corporate supervisory boards by members of the works councils.

"It is a matter of codetermination," explains the unionist Mr Bartel.

This sort of governance by consensus is close to the German heart; and many Germans hope such willingness to compromise will help if Sundays' election ends in the formation of a grand coalition between the Mr Schroeder and Ms Merkel's parties.

Though seen with the eyes of an Anglo-American investor, it is usually a recipe for disaster, whether it is applied to politics or to business.

Hmm, the idea of co-determination and cooperation is seen as a "recipe for disaster" by the Locusts...when one could argue that what they really want IS disaster...of a system that is quite productive (but anti-thetical to theirs

So...how does a plague of Locusts trigger a recovery??

Display:
by afew (afew(a in a circle)eurotrib_dot_com) on Wed Sep 28th, 2005 at 11:38:20 AM EST
As always, you have the good funds, and the bad funds. Those able to think long term (or at least medium term) and willing to build on the strengths of the companies they buy, and those that effectively want to strip it.

The more successful do take the long view, and can be a force for good, but they are also often followed by less competent wannabes who try to imitate the returns but have less imagination to do it and cut, cut, cut.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Wed Sep 28th, 2005 at 05:08:07 PM EST
All right you punks, line up. It's ME, Katarina! You will feel good OR ELSE! Self Doubt? Ha, I laugh at Self Doubt! Here, put on this leather, now don't you feel better? See, I TOLD YOU!
by Rolfyboy6 (rolmsted@hawaii.rr.com) on Wed Sep 28th, 2005 at 06:29:39 PM EST
By the way: Looks like there really will be a "grand coalition" of conservatives and social democrats in Germany. The Berlin newspaper "B. Z." reported yesterday that Schröder was planning to step aside to make way for a "Grand Coalition" of SPD and CDU, according to this article in Financial Times Deutschland.

On the other hand, the "B. Z." may not be the most reliable source of information ...

by rwe (roland.weede_NO@SPAM_gmx.net) on Thu Sep 29th, 2005 at 09:11:34 PM EST


Display:
Go to: [ European Tribune Homepage : Top of page : Top of comments ]

Top Diaries