The US Treasury is right about Germany’s Eurozone policies: Here is why

A good post on where we are now and why Germany is a big part of the problems in Europe.

Yanis Varoufakis

On 30th October, in its Report to Congress on Economic and Exchange Rate Policies, the US Treasury took a swipe at Germany, accusing it of exporting economic depression to the rest of Eurozone and, indeed, to the global economy. The German Finance Ministry responded the next day with a statement that: “There are no imbalances in Germany that need correction. On the contrary, the innovative German economy contributes significantly to global growth through exports and the import of components for finished products.” There are few occasions in any argument where one side is completely right and the other comprehensively wrong. This is one of them! The US Treasury is spot on and the German response, unwittingly, confirms this. In this post I summarise the analytical foundation (as I see it) of the US Treasury position; a position that, incidentally, this blog has been putting forward (and analysing) for years. In…

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