Posted by WARREN MOSLER on October 22nd, 2010
The don’t know the elevated fiscal deficits due to their ‘automatic Keynesian stabilizers’ did the trick, including (temporarily) weakening euro?
So why are they spewing this nonsense?
Class warfare to keep union demands in check and domestic demand suppressed so the well off can optimize their personal real terms of trade?
Expect austerity to continue to work against domestic demand and keep the forces in place that will continue to drive the euro to a level high enough to contain net exports.
By Gerrit Wiesmann and Stanley Pignal
October 21 (FT) — “Growing domestic demand shows our recovery is standing on two feet,” said Rainer Brüderle, Germany’s economics minister. Gross domestic product is expected to rise by 3.4 per cent this year, up from a spring forecast of 1.4 per cent, and 1.8 per cent in 2011, up from 1.6 per cent. Mr Brüderle said Germany’s recovery was “a non-Keynesian growth programme” in which fiscal discipline spurred private investment. “It’s a textbook recovery,” Mr Brüderle said, describing how an uptick in foreign demand earlier this year had spurred exports, then investment and finally job creation in Germany itself. Unemployment is expected to fall below 3m this autumn and remain “clearly below” that mark next year. At the start of the year, economists had worried about whether the German upturn would be “V-, W-, L- or U- shaped”, he said. “Now we know that was irrelevant. This has become an XL [extra-large]-recovery.”