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Busting The "Core" European Myth
Everyone knows that Europe is divided into the Periphery (aka the PIIGS), and the Core (aka the countries that are supposed to be safe). What everyone also knows, is that the core, naively represented by Germany and France, supposedly has homogeneous distribution of economic growth and prospects. That all changed last year, when France moved from being a AAA-rated country, to a fallen superduper angel following the Moody's downgrade to AA+. Yet nowhere is the glaring divergence between these two formerly comparable economies than in the two articles cited below, both from the same publication, and both from today.
Volkswagen's German workers win 4.3% pay rise
May 31, 2012 07:46 CET
HANNOVER, Germany -- Volkswagen agreed with the IG Metall union to raise wages for German workers by 4.3 percent over 13 months, echoing a pay contract signed by the union for the country's industry-wide engineering staff.
The pay rise for 97,000 VW production workers and 5,000 employees at the company's financial services division will take effect June 1, VW said in a statement on Thursday.
The new pay accord also includes provisions to hire 3,000 temporary workers and take on an additional 175 trainees a year.
"This is a very good and acceptable compromise," IG Metall chief negotiator Hartmut Meine said on Thursday at a press conference in Hanover.
VW's new in-house wage deal, signed after all-night negotiations, reflects a salary agreement reached between IG Metall and employers on May 19 for 3.6 million engineering workers across Germany, affecting staff at companies including Daimler and BMW.
"Workers will earn a decent pay increase," Martin Rosik, VW's chief negotiator said at the press conference.
PSA seeks job cuts, pay freeze at French plant, unions say
May 31, 2012 08:58 CET
PARIS -- PSA/Peugeot-Citroen has asked workers at its Sevelnord plant in northern France to agree to a pay freeze, hundreds of job cuts and other concessions, or face possible closure, officials at two unions said.
The company is opening talks on plans to reduce the threatened plant's 2,700-strong workforce, freeze salaries for at least three years, reduce leave and impose more flexible hours, CGT and CGC union representatives said.
PSA declined to comment on plans for Sevelnord. Its ultimatum, if confirmed, echoes tactics successfully employed to win concessions from workers at Fiat's Pomigliano factory near Naples, Italy, and General Motors' Vauxhall plant in Ellesmere Port, north-west England.
"This amounts to industrial blackmail," said Ludovic Bouvier of the CGT, PSA's biggest union. "They want us to set an example that workers in the rest of the group's factories will eventually have to follow."
Q.E.D.
But if people are finally waking up from their "core" cognitive dissonance, just wait until we actually have to split the atom, or in this case Germany, into its constitent West and East parts, as the second law of thermodynamics confirms that it is far more powerful than any central planner.
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random pockets of chaotic power manifested but we all disregard
the once ordered states of society on a scale which no one can think about it
this ain't no anarchy, this ain't peace or revolt
we're in this greek tragedy orchestrated by Boltzmann in his lab!
It's entropy,
its the end of history!
We cannot divorce.
http://silvervigilante.com
Eurofail will eventually metastasize into Germany as well. In the meantime enjoy your schnitzels and brau.
http://www.bankstersbanquet.com/
Epic Ahmeexnal. Im ordering now.
whats the point RP will not get nomination; done deal.
There is a lot more precariousness in Germany than the world wants to see. For now the teflon myth is still intact
Thumbs up :)
Mr. Gorbachev, please rebuild this wall!
Bullish for German concrete.
classic!
An apple with a shiny peel and full flesh is not quite edible when filled with worms you see after you bite into it.
Get out the coring tool, the carving knife, and the peeler.
Entropy is always increasing, bitchez!!! Greece to Spain to France, where will it stop?
Entropy is always increasing in closed phsycial systems. Open systems, for example life forms, are different: They are able to take in energy and direct its application. It isn't the entropy of physics which is at work in europe, but rather the onset of decay in which legal rules and the humans implementing them can no longer function as open system taking as much or more energy, capital, knowledge, sales orders, as they lose. The legal and industrial "DNA" which allowed them to prosper has left many of the regions and nations, replaced by a defective but slow-acting bit of DNA whose instruction is "borrow from another nation's system until you are so weak they come and scavenge your remaining assets."
Quite a lot of gibberish to keep up the US citizen claim they, US citizens(open systems) will overcome the environment (the closed system)
If you have ever driven a Peugeot, you know why this company has severe problems...
How much in total do the PSA workers earn compared the VW workers? These stats are seldom mentioned. Why is that?
That would be too honest.
They retire at 21 don't they?
Or as Mandelbrot might have said: http://tinyurl.com/7fy38c8
"...Germany and France, supposedly has homogeneous distribution of economic growth and prospects."
can we dispense with any inkling the Govts have any grasp, let alone control, over their two economies and the trade between France and Germany
the only issues the French and German Govts control are their own spending programs and their debt levels. What they are discussing is debt across Euro Govts, it's zero to do with the economy or growth over which they have little influence (except negative with the tax take)
clearly there needs to be an EU/EC directive that Peugeot workers should be paid and receive the exact same pay rise as VW workers: good luck with "harmoginising" that one!!
You North American readers don't get the French cars out your way, I think.
The French cars are more stylish and generally have more comfortable seats. It's amazing how they can make a hatchback look good. The German cars are more reliable. Depends on what one prefers.
Funny when Americans visit here, they think we are 'poor' because so many cars are small. Here, even millionaires often choose to drive small cars.
Europeans drive smaller cars than Americans because the cars are taxed to death, the petrol is taxed to death and we're bigger idiots (sheep) than Americans to put up with this shit (theiving Euro Govts)
Anyone who is familiar with Europe knows why they favor small cars, and it has zero to do with anything you just mentioned, unless you think the design of 600+ year old cities is all about out-of-control government regulations.
i'm more familiar with Euroean roads than anyone in Europe as nobody drives around the continent more than i do!!
Yes i agree we have smaller more congested roads in Europe. But the primary reason we have smaller cars is because they're taxed every which way and are expensive compared to US prices
No. The primary cause is the infrastructure. Just as for Japan.
Taxation has evolved but the size of cars has kept the proportion.
This is also worth for Japan.
No economy is immune from this virus. That's been the pattern and the trend is intact. There are only 2 directions things can go in: centrifugal breakup of the 40-year old post-Bretton global economy OR tighter integration and a fresh set of chips and cards. Place your bets.
latter
Looks like German cars are going to cost more...
Not the best plan when your customers are living in a climate of Austerity.
Excellent analysis except that you got it all wrong.
The whole idea here is to help the periphery by making German-made stuff, especially exports, pricier, so that the fucks from PIIGS can export more.
And it also has mildly boosting impact on inflation, another thing that the ECB wants to see. So with this Germany is basically helping the periphery.
Now, I'm sure they wouldn't mind for French car makers to survive, but realistically we can't ask the Germans to do two jobs. The French should have cut their taxes before they got in this situation.
And which one sounds most like the US?
The second, negative article does.
Can you imagine the SCREAMING on pages like this one if you replaced VW with GM and the factory was in Ohio?
NO GOOD UNION SCUM!
2:31 on the west coast, 10:31 in Ireland where polls closed 31 minutes ago on the EFSF referendum. Counting begins tomorrow and we should have some results by mid day, but the real news was turnout, only 20% of the 3.1 million eligible to vote went to the polls. In previous referenda this proved storngly to favor the NO camp.
If Ireland rejected the treaty then look for others to do the same since only three so far have ratified it. Also, look for Ireland to get frozen out of financial markets and a German backlash.
20%??? Thats bad. I mean, that humonguous contraption in Bruxelles is definitely alienating for regular people, but 20% - on this very important subject... Thats bad.
Why the big delay to count only 20%? Do they need the time to scratch off "no" to a 'yes" on 11% of the ballots?
JFC what a bunch of nonsense!
The Irish will vote till they get it right.
Which part of above sentence do you not understand?
[...]
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.
[...]
And what rough beast, its hour come round at last,
Slouches towards Bethlehem to be born?
It is interesting that the article takes as target the absence of a core group in Europe as theme; precisely when the core group of Pax Americana is in the process of imploding under its own financial spiral. Can there be a cause and effect relationship between these two major tipping events? The divergence visible, under financial stress and banking meltdown, of Germany's position from the other more troubled nations is now clear. So the core is going to break down as this collapse is world wide and will effect the financial and economic reality of Europe. But it will not effect the political momentum in Europe, which will stay focussed on more cooperation even if it may entail the scrapping of Euro currency and the nationalisation of banks in each troubled country. Watch out for Germany's role in Euro continent and its surge towards Asia...
This is one of the outcomes of financial and economic reset that will occur, along with the profound changes that will occur when US power wanes in Middle East, hub of oil production. Watch out for Turkey as key player there.
Tipping times and core first world nations are now fragile and faced with economic attrition big time.
> Watch out for Germany's role in Euro continent and its surge towards Asia...
Germany-Russia makes more sense to me.
There is no need for Germany to overstretch itself. Unless you consider alliance with Russia to be a way of surgIng towards Asia.
Yep, but Germany is now also decoupling from Oil/nuclear, in its huge investment in Solar : 20 nuclear plant equivalent and going stronger over the next decade with wind. We may be seeing a new paradigm on energy front emerging from this crisis.
the downgrade is one thing
the recent election which makes the downgrade seem mild, is another, but isn't put in play in this piece
imo, tyler develops only one "tipping point": france
political cooperation may not be so palatable when: financing it = poisoning oneself; and where oneself = germany
but a theme i see here. as unwinding progresses, some win, some lose. no way around it.
as things go, north america is a really good continent. and as bad as things are, north american things are mostly legislative in nature. not math problems.
eu, japan, even china have math problems.
for tactics, we could model ourselves after the germans :)
no military.
it'd be a heck of a start.
toss in strong dollar to lower commodities, and away we the common folk would go. movin on up a bit at a time. helpin raise the tax receipts that help lower the debt, that strengthens the dollar. that circles back.
flow.
it has to be bettor than control p.
dollar will say if bernak understands this too.
:)
who gives a shit about cars
Drivers?