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Germany sees company bankruptcies soar

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Re: Germany sees company bankruptcies soar

#71

Post by ivan_gammel »

wolframhempel wrote: post #46

As a German who lived abroad a long time, but moved to Berlin eight years ago, here’s my (completely personal) assessment of why Germany is going down the drain economically - and will continue to do so: 1) Mindset and Culture. The idea of entrepreneurship, hard work and reward for risk is becoming completely alien to Germans. New technologies and high growth sectors are almost exclusively perceived in terms of their…

I agree with all of that with a few corrections:

4. Climate change-related policy that doesn’t make sense is the new law about heating systems, not nuclear power shutdown. Nuclear power in Europe is risky and very expensive, not least because our supply chain is not secure. Neither African, not Russian/Kazakh uranium are a good option. We still have room for more renewables and they are good.

5. That’s not a bad thing, just very un-American. I have seen plenty of layoffs in IT sector here, it’s not that hard to do it. However overhiring to do a layoff in one year is also the most stupid thing that happened in the last 5 years. I doubt that having too much flexibility does help the business. Maybe managers need to be smarter a bit and use available resources more wisely instead.

Re: Germany sees company bankruptcies soar

#72

Post by hobofan »

marcuskane2 wrote: post #70
hobofan wrote: post #66

Earlier quoted context omitted.

> I met many engineers who would be completely willing to work more hours, but it makes very little sense as you are working the additional hours for far lower wages. "Far" lower wages? Progressive income tax is constant at 42% for essentially the whole salary range that is relevant for an engineer (66-278k). As a concrete example, total tax burden at: - 70k is ~40% (42k net) - 100k with ~44% (56k net) - 200k with ~4…

That's only part of the equation though. If lower income means you qualify for subsidized housing, subsidized childcare, etc then that can be a big incentive. I have two sisters with very similar lifestyles despite grossly different incomes. My low-income sister gets her housing, groceries, utilities, childcare and even phone paid for by government programs. My other sister (near median income) lives in an apartment…

Yes, for low income brackets (and certain constellations with partners, kids an joint filing) where you face subsidy cliffs, I can see that being an issue.

However that was not at all what OP argued with engineering salaries and progressive income tax leading to "far less" net income per additional hour worked. The issue you brought up has much more to do with hard subsidy cliffs and high cost of living eating up the disposable income for low income households.

Re: Germany sees company bankruptcies soar

#73

Post by surfingdino »

petre wrote: post #65
surfingdino wrote: post #30

Earlier quoted context omitted.

They also lost Russia as a market to sell to. Ostpolitik bit them in the ass, because they did not diversify their energy supplies.

Germans keep complaining about the loss of Russian gas and refuse to see the war as an opportunity to scale up their military industrial complex, arm themselves to the teeth, sell weapons to Eastern and Southern Europe. Poland and Romania are buying tanks and howitzers from the US and South Korea, the French have their own industry.

Making heavy weapons requires lots of energy and they just lost access to it.

Re: Germany sees company bankruptcies soar

#74

Post by ivan_gammel »

submeta wrote: post #34

How does this fit with the observation of the German DAX going from 12,000 (during pandemic even below 9k shortly) to currently 18,000? Can anyone give a good explanation?

Inflation and interest rates, both recent and future ones.

Let’s say a company has revenue X and is valued as NX on the stock market. Let’s say they will be increasing prices to maintain profits in the next several years and will reach X+Y just because of that. If nothing else changes fundamentally, they should be valued at N(X+Y) at some point.

Re: Germany sees company bankruptcies soar

#75

Post by echoangle »

surfingdino wrote: post #73
petre wrote: post #65

Earlier quoted context omitted.

Germans keep complaining about the loss of Russian gas and refuse to see the war as an opportunity to scale up their military industrial complex, arm themselves to the teeth, sell weapons to Eastern and Southern Europe. Poland and Romania are buying tanks and howitzers from the US and South Korea, the French have their own industry.

Making heavy weapons requires lots of energy and they just lost access to it.

A leopard 2 costs about 30 million euros, how much of that is spent on energy you think? It’s just ridiculous to claim that energy is the bottleneck here.

Re: Germany sees company bankruptcies soar

#76

Post by IAMMidway »

_ph_ wrote: post #61
wolframhempel wrote: post #46

As a German who lived abroad a long time, but moved to Berlin eight years ago, here’s my (completely personal) assessment of why Germany is going down the drain economically - and will continue to do so: 1) Mindset and Culture. The idea of entrepreneurship, hard work and reward for risk is becoming completely alien to Germans. New technologies and high growth sectors are almost exclusively perceived in terms of their…

No, the government isn't "on a largely ideologically driven understanding of climate change prevention". The shutdown of the nuclear reactors was decided by the previous government in 2011 and never reconsidered. Yes, as part of the war against Ukraine, Russia cut their gas deliveries to Germany. We managed to find other suppliers, but at least short term, sport market priced for gas went high up. This has by now set…

Your answer is a non sequitor.

The shutdown of the nuclear reactors was an ideologically driven decision by the last government and the last government before that.

Energy prices are extremely high which damages the German economy. Renewables depend on massive subsidies that Germany can't afford less and less.

Oh and Gas: Switching supplier from Russia to Qatar wasn't a brilliant decision. You just replace an adversarial supplier with another one. Thats really no reason to pat yourself on the shoulder. Its an extremely short term decision.

Re: Germany sees company bankruptcies soar

#77

Post by oytis »

petre wrote: post #65
surfingdino wrote: post #30

Earlier quoted context omitted.

They also lost Russia as a market to sell to. Ostpolitik bit them in the ass, because they did not diversify their energy supplies.

Germans keep complaining about the loss of Russian gas and refuse to see the war as an opportunity to scale up their military industrial complex, arm themselves to the teeth, sell weapons to Eastern and Southern Europe. Poland and Romania are buying tanks and howitzers from the US and South Korea, the French have their own industry.

Rheinmetall has been increasing production though. It's just a) getting into this business is hard, so it has limited effect on the rest of the economy b) arming oneself to teeth costs money, which is German budget is pretty low on at the monent

Re: Germany sees company bankruptcies soar

#78

Post by _ph_ »

IAMMidway wrote: post #76
_ph_ wrote: post #61

Earlier quoted context omitted.

No, the government isn't "on a largely ideologically driven understanding of climate change prevention". The shutdown of the nuclear reactors was decided by the previous government in 2011 and never reconsidered. Yes, as part of the war against Ukraine, Russia cut their gas deliveries to Germany. We managed to find other suppliers, but at least short term, sport market priced for gas went high up. This has by now set…

Your answer is a non sequitor. The shutdown of the nuclear reactors was an ideologically driven decision by the last government and the last government before that. Energy prices are extremely high which damages the German economy. Renewables depend on massive subsidies that Germany can't afford less and less. Oh and Gas: Switching supplier from Russia to Qatar wasn't a brilliant decision. You just replace an adversa…

You are using the word "ideology". That isn't the hallmark of good arguments. But may be we can agree onto that the current government is trying to fix all the problems caused by the previous one. The problem wasn't shutting down the mostly old nuclear reactors, the problem was curbing the ramp up of renewables. But fortunately, the current government is fixing that. Which brings energy prices down and while currently we are hit by many factors, quickly can become a big support for Germanys economy. It might be expensive leading a trend, but it does pay of long term.

Re: Germany sees company bankruptcies soar

#79

Post by throwbadubadu »

itsoktocry wrote: post #26
snowpid wrote: post #17

Earlier quoted context omitted.

is there any reason why this post is voted down?

> is there any reason why this post is voted down? Because it presumes the only reason people are voting "right-wing" is because they are reading "doomsday news". Versus, you know, disagreeing with the way the "left wing" have been running things. Not sure why the left are going with "You're not poor, look at these charts" as a political strategy, but unsurprisingly, people aren't buying it...the world over.

Sorry if I gave that impression, but it is wrong. "I feel" indicates that this is a not very certain assumption by me, and "We wouldn't be where we are" meant that I believe this is a contributing factor, not the only reason, I even gave one of many others (unfair distribution) few words later. shrug

Re: Germany sees company bankruptcies soar

#80

Post by trueismywork »

blueflow wrote: post #32
trueismywork wrote: post #27

Earlier quoted context omitted.

A serious question: Is the situation better than other economies?

How would i know? The company runs in Germany and is a local business.

It makes no sense to think about whether a situation is good or bad without comparing it to other economies in a globalized world. If all economies are suffering, then the problems are bigger than a single country. But if only one economy is suffering, the problems are definitely specific to that country. So, situation might not be that bad because theres no real loss, but may be the economy is suffering from opportunity loss. So your competitors are growing at 4% and your growing at 1% which means effectively you're shrinking at ~2%.
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