Eating Out Chatter

 Last night, the wife and I went out to eat...at a fairly well known German restaurant in the local area, and I ordered Cordon Bleu.

Normally, before the Covid era, this would be priced at 11 to 12 Euro per plate.  

Last night?  21.50 Euro for the plate.  

I looked across the menu, and most everything was 25-percent minimum up from where it was in 2019.  Some were up to 50-percent higher.  

Affecting people eating out?  I would think more than a third of German society is going to be fairly picky about eating out, and most restaurants will be shut down for three nights of the week, as we go into the fall.  

Q-and-A

 1.  Ukraine on a 'win-streak'?

Well....for the past ten days....the Russians have shown a nature to retreat.  There was long forecasted that as August-September came.....more advanced weapons would arrive for the Ukrainians, and the evolution of the war would take place.

Right now, there's around 10,000 Russian conscripts in a 'pocket' and without much on logistical support.  They need to be removed, or face some kind of surrender.  I expect this trend to continue through October and November.  

2.  The CDU Party in Germany (Merkel's old group) setting a quota for women in leadership?

Yes, from party members.....for leadership positions, there has to be a fairly level playing field by the new rules established.  Not a positive or negative.....just a situation to say the CDU desire to be like the SPD and Greens.

3.  Did the German Association of Towns and Municipalities come out with a worry statement yesterday on blackouts this winter?

Yes, but it was aimed at retirement homes and hospitals....suggesting they were not prepared for this event.  

4.  Another scandal brewing for public TV/radio?

N-24 brought up this issue of directors/executives going off on meeting trips/conferences....without any oversight/audit of cost/expenses.  There's some effort going on to show 'permissions' but it'll beg the question....how has money been spent the past decade?  

5.  Some chatter going on in Germany to nationalize the power companies? 

Yes, but mostly from the far left, and there's no real public support at present for this idea to occur.  

6.  Coke versus Edeka (the grocery chain) war going on?

Well....Coke raised its prices and Edeka said 'no'.....to the extent that they won't allow delivery or sales within their grocery chain.  Coke is upset about this, and even tried to get the court to order Edeka to sell their sodas.  Yesterday, the court said 'no'.

What Coke runs currently in the 1.5 liter container?  Around 99 Euro cents, with the quarter deposit fee on the plastic container.  I should note, if you were buying in the smaller containers or cans.....it is a bit more expensive per ounce.

I should note that I regularly use Edeka and they have a fair amount of drink competition so you don't really miss Coke that much.  

The 'Power-Barges' Idea?

 In the last week or two, if you watch German government officials on TV....this power-barge idea came up.

So to explain this....you'd have some floating power-plant (on the high seas) which would have oil-tankers come up and fuel them up....then the barge 'spurts' out electricity via a line to the coast, and delivers this to consumers.

Risk-factor?  I looked at this idea, and just shake my head.  A serious storm, and some tidal wave hitting....could toss the barge and create a massive problem for clean-up.  

The necessity of a barge instead of a regular land-plant?  Well....you wouldn't ask permission of anyone, and it could not be delayed for months or years in court.

In a Green Party frame of mind....it makes perfect sense.

On risk-taking?  Out of a 1-to-10 situation.....I'd give it a 'eight'.

You might as well create a floating nuke-plant-barge and run it thirty miles off-shore, and lay the cable from there to the coast.  

Excess Profit Chatter And Reality

 In recent weeks, political folks at the EU and in the Bundestag have jumped on excess profit, and say they will micromanage this....taking the excess profit away.

So, lets say I run a bowling ball manufacturing plant in Mainz.

Each year, as the owner, I generally took home around 1,700,000 Euro profit.  

Lets say that the excess profit crowd came to the building and announced that the 1,700,000 Euro profit was over their agenda amount.  Their feeling?  They'd take a cut of the 1,700,000....probably around 50-percent....leaving me with 850,000 Euro instead.

Maybe I was accepting this....but I think most would not accept it.

So I would start to re-build my business.  The actual bowling balls themselves?  Instead of making them in Mainz, I'd go to a country like Poland or Czech....believing that they would never allow the EU to get deep into this business.  

I'd make the balls there, and ship them by truck over to Mainz....to drill the holes.  I'd dismiss 90-percent of my Mainz employees in the process.

I'd also plant my business headquarters in a country like Cyprus.  The German name would still be on the ball, and it'd say 'finished in Germany' (while made in Poland).

What would happen?  About two years into this great campaign to take excess profit away in Germany.....politicians would wake up and realize that 2.5-million jobs disappeared from companies shifting to the east.  

Suddenly, the excess profit agenda would be halted.  But by then....it's too late, and the companies won't move back.

So a year or two will pass....with tax revenue lessening and political folks appearing on public TV to explain what happened.  They'd eventually beg for forgiveness, and create 'tax credits' for new companies to move into Germany....taking the money for this....from regular tax-paying citizens.

To be blunt, I'm not worried about the excess profit chatter.  It will lead to a evolution in Germany where you have lots of people on unemployment and no real employment landscape for them to thrive or work.  Less tax revenue....means less money being funneled into public projects.  In a decade, Germany would be made into another 'Italy'.  

My bowling balls?  They'd still be around.  And yes, I'd still have my 1.7-million in personal profit off the business.  

The Natural Gas Landscape

 There is a terrific piece at NDR (public TV for the Hamburg region) which talks about the reserves.

If you go by the numbers (government statistical data), then it's a pretty positive story.  Three significant facts:

1.  Natural gas consumption has trimmed back since the 'worry' started.  Germans are presently using around 85-percent of what would be 'normal'.  

2.  The national reserves?  If the numbers are correct....as they exit winter in 2023, forty-percent of the reserves (at present pace) will still be there.  This would mean a normal winter.

3.  Norway, Belgium and Netherlands have stepped up production and shipment of natural gas into Germany.  A lot?  No.  But a percent here and there....does add up.  Norway pretty much admits that they are at absolute top production and shipment.

The LNG game?  Yet to be a player, but once the first ship docks and unloads....I suspect worries will drop a bit.

Pricing of natural gas?  Another story (by NDR).

A year ago, 1 Kwh of natural gas was running at 5.8 Euro cents.  

Today?  The same 1 Kwh is running around 38 Euro cents for new customers.  Yeah, existing customers (long-term) will pay less.  

Six times the rate?  Yeah, and that's really the heart of the issue.  A guy who heated his place for 18 hours a day in the past....probably will try to go to 12 hour day where it's marginally heated when no one is around the home or people are sleeping.  

It wouldn't shock me if working-class Germans kept their place heated to 16 C (61 F) and used an electrical heater to occasionally bounce the temp up four degrees.  

If you were looking for real estate deals where large sized homes are selling for one-quarter less....then watch the market in the summer of 2023.  

Did The Russian Artillery 'Game' Stall Out?

 Well....it's interesting.  From March onto July, the Russians were hyped-up on use of artillery, and it was a major part of their limited success story.  

In the past month....you don't see that much on artillery use.

I sat and listened to a podcast, where the discussion came up about a maximum number of rounds fired per artillery piece, where the barrel is no longer 'safe' (effective).  Typically, it's around 1,000 to 2,000 rounds fired (per modern barrels). 

So they were suggesting that the limit has been reached and there's just not that Russian capability existing to mass produce replacement barrels on a bulk scale....that you'd need for a military operation like this.

This already arriving in May?  Well....you notice a lot of use of rockets by the Russians in the May/June period.  Maybe the switch occurred even earlier.

What this leads to?  Well...unless they make new artillery barrels or bulk-buy off India, North Korea or China....artillery isn't going to be a big player for the next phase of the war.  

At the rate that tanks and artillery are being removed from the situation?  It's a different kind of war, and not one that would be beneficial to the Russian game plan.

Will Natural Gas Pricing In Germany Ever Return To Normal?

 I watch a lot of business news and probably read through fifty-odd articles per day.  All of this natural gas chatter in Germany goes mostly to the 'new' cost of things....being between three and five times what it was a year ago.

So my general question....once we emerge from winter in April of 2023.....will thing settle into a norm, and possibly retreat from this current situation?  

I've come to the opinion that it will NOT return to a normal level, and this three-to-five times rate....will be the new norm, possibly for several years.  The Russia cheap-route?  Well....the gimmick worked to the point....that now, it won't work.  

What's this translate to?  Three big issues:

1.  Industry that made profit and provided jobs in Germany.....will not be able to compete against countries that had a interior supply or non-Russian situation going on.  You will see a rapid slow-down in German profits over the next year or two.  Jobs will be a problem.  

2.  Natural gas heated homes will go through a transition.  Even if you had a a relatively new furnace.....your view will be that a cheaper method has to be procured, or an alternate heating method established.  I'm not saying solar is the answer....just that something has to evolve on a fast basis.

3.  Fracking will be accepted by the public in Germany.....even if environmentalists are wired to be against it.  By spring of 2023, I will predict that this is a top ten issue, and will be something that more than half the population accepts.

Social unrest coming?  Well....it will affect voting but there are only three elections at the state level in Germany for 2023.

Attack in Ansbach?

Around 6 PM yesterday, as folks were attempting to get home....an incident started up at the Ansbach train station (town about 20 miles SW of Nuremberg, deep in the heart of Bavaria).

What the cops say (via BR)? 

Some guy (age 30) pulled out a knife, and just started attacking folks....uttering the phrase 'Allah Akbar'.

Wounded?  Apparently two folks were cut, but not in mortal danger.  

As in most major train stations.....police patrols are a big deal, and within a minute....they were on the scene....telling the guy to cease.  No reaction....they pulled their sidearms, and fired.  Guy was dead at the the scene.

Muslim radical?  Well....here's the thing, as time passes and you examine cases like this, it usually turns out that the guy was a non-German and had mental issues (like paranoid schizophrenia for example).

Nutcase?  The police say one interesting comment: "We know who he is."  This typically means that they've had run-ins with the guy before and he is a known 'character'.  

I know that some folks will pick up this and say it was a terror episode, but if you gaze at news reports over the past five years....you just see this mental issue come out more and more.  Most of these episodes are not planned and just the spur-of-the-moment.  The script?  A guy gets unhinged and does really stupid crap.

The Electrical 'Brake' Chatter

 I watched a N-TV news segment this AM....explaining how the German gov't intends to prevent rising costs for electrical usage.  The deal?

The government intends to set a max limit on each Kwh.  As the operational cost exceeds that?  There will be a bucket of money (figured in the 18-billion Euro range) from a previous tax called the EEG tax.  What was EEG supposed to be for?  Well....renewable energy, and to entice operators to develop more assets in that direction.  The government has decided to use it for a different cause.

Issues?  No one says what the estimate of real cost for this winter will be for power, or how fast that 18-billion Euro will go.  

Presently, it looks like a good idea.  

Habeck Chatter

 A lot of criticism over the past day or two in Germany toward the Economics Minister (Habeck, Green Party).

So today....Habeck tossed criticism back at the CDU Party (Merkel's old group): "Dear Mr. Merz (the boss of the conservatives), the Union ruled this country and many federal states for 16 years. 16 years of energy policy failure.  In a few months we'll clean up what you screwed up, prevented and destroyed in 16 years."

If you asked me on independent analysis?  I'd say that whatever German policy that has existed from the 1970s on....was connected to the idea of Russia being a 'equal' partner, and never a threat (even while the Warsaw Pact/Soviet Union existed).  It was a crappy policy but it got cheap natural gas into Germany.  

In the past twenty years?  The priority was not cheap electrical rates or natural gas.  This was the deal with the SPD, and with the CDU.  

So Habeck may have a point, but no one really since the 1970s has cared for the German consumer.  

Reality

 My wife (German) sat and had a conversation with her aunt, who is in the early 90s age....meaning she was born around 1930, and was a teenager during WW II here in Germany.

The topic of the current natural gas crisis and the national fear of limited heat came up.

The aunt was not really shaken or fearful, to which she pointed out.....anyone who witnessed the 1940 to 1945 period....knows that a lot of people had marginal heat.  You threw a couple pieces of coal in a fireplace or 'oven' and you accepted the fact that marginal heat was better than zero heat.  She really didn't see the chaos or big deal about what was going on.

Some Germans would suggest that society has become somewhat weak over the past couple of decades, and maybe they need a moment like this to face up to reality.

Oktoberfest Chatter

 I noticed the hype over pricing at Oktoberfest (starts in 10 days) last night on TV.

So a maas (1-liter of beer) will run in the 12.60 to 13.70 Euro range.

If you just wanted a 1-liter bottle of water?  That's up around 9.70 Euro.  

A plate of a half-chicken?  Near 14 Euro.  

Yeah, it's all a bit high compared to a decade ago.

AdBlue Story

 This is a funny story....which is also pretty dramatic.

So we have this product mandate in Germany call AdBlue.  In simple terms, you have a diesel delivery truck/van, and you need to run it at a clean-level.  So after you fill the tank up....you are supposed to add some AdBlue liquid to your tank.

Current cost of AdBlue?  It had been around 6.50 Euro for a while, and because of the production business....it's now up to around 10 Euro (late August prices).

The general idea is one liter, per each fill-up.....for a diesel van.  More, for the big rigs.

All of this....because of the EU-6 mandates?  Yes.

So the biggest producer of the AdBlue liquid was a company in Germany called SKW (40-percent of AdBlue in Germany was made by them).  They halted production two weeks ago.  

What they say....a lot of the production leads back to natural gas usage, and their pricing was going to crazy levels.  

AdBlue a byproduct of ammonia production?  Yes.

So here's the thing which is going to lead to a logistical crisis in a matter of weeks, as reported by Focus.  Around 800,000 delivery vehicles in Germany require this AdBlue...to function.  

On a daily basis, between the logistics folks and regular folks with diesel vehicles?  There's around 2.5 to 5 million liters used.  Yearly?  Over a billion liters required.

Making up for SKW?  Well....only if you grasp the price per liter, and this will be heading way up in the next month.  

I looked at pricing for early September, it's up to around 19 Euro for a 10-liter can.  My humble view for December?  It'll probably be going for 30 Euro minimum.  Yeah, if you could find a pallet of the stuff currently.....I'd buy 500 containers and just sit on them for sixty days to double my money.

The bus and logistics folks will end up having to halt operations because of the stupid pricing?  Well...yeah, this could happen.  

All leading back to Russia's war?  Yeah.  That's the amazing part of the story....with the EU mandate to force clean air, and regulate things.

Why The Blackout/Electrical Worry Exists in Germany

 So, for those who aren't aware...the majority of homes/apartment/residences in Germany are heated by natural gas (2019 numbers), at roughly 40-percent.  Oil comes in second at around 29-percent.  Rest?  Mixture of pellets, coal, district hook-up, etc.

The Germans over the decades bought more and more natural gas from Russia, and in this sanctions period....the Russians have decided to 'stick-it' to the Germans by mostly cutting off the natural gas.

A normal German would look at the situation, as winter approaches, and worry about the cost/supply.  A guy with a 75 sq meter place....modern furnace...tight windows....might have a 2020 bill for the year of 1,100 Euro.  Right now, the warning letters are putting the 2023 bill at 3,000 Euro.   So this guy is going to be desperate to save heat.

In this strategy, he'll decide to limit heat.  

So he starts with the hours of low-heating, which typically were from 11 PM to 5 PM....where minimal heat was 'burned'.

He'll probably go and have for Monday through Friday....a second minimal heating period of 8 AM to 4 PM, if no one much was in the house/apartment.  

He might also go and limit the home to 16 C (61 F), then try to use conventional heaters (ranging from 1,200 to 2,000 watts) to bring the temp up four degrees.  This idea is what worries the government.  

If 90-percent of these homes put a conventional heater up and used just one....sparingly, then it would not be a big deal.  But if you had some guy running three of these....with the majority of people running two to three, then the grid would be having demands that it could not provide.

More power to be drawn.....from where?  Well...the German culture is so hooked-up to environmental concerns....that coal and nuke power are regarded as 'evil', so just to suggest these....gets some folks all disturbed.

So this winter is worrisome because of the lacking natural gas, and the reasonable idea of using electrical heat to make up for the woes.

Lets add to this issue by the idea that these folks with 3,000 to 4,000 Euro of heat....will take the required money from their 2023 vacation money....which means the recession goes even deeper by the summer of 2023.  That lousy 250 to 500 Euro the government is 'gifting' people?  In the vast majority of cases....it just marginally eases the pain.

The worst case I've seen so far (from TV news)....was a retired couple who had a 160 sq meter home (modern place)....with natural gas heat, and the warning bill suggested his 1,600 Euro bill from 2021 would now go up to around 9,000 Euro.  It kinda freaked them both out.  I would imagine he'll clear a room or two for use, and avoid heating it.  

All this leading some folks to go to heat-pumps?  Well.....yeah, and solar as well.  Some folks are looking at the pellet system for one central point in the home.  But the solar experts are being hit in a massive way now, and if you tried to call them.....they'd likely respond that they will put you on the list but it'll be summer fo 2023 before they can get to you.

It's a mess, without much that the government can do.  Adding to this....blame goes to Putin, and most Germans have this angry view of the war.  The Germans will eventually climb out of this mess....probably in two years, and will vow never to buy anything from Russia, or to sell them anything.  For an entire generation....Russia will end up being cut-off.  

It's an odd story to lay out.  

My Script For Germany's Blackouts Script For This Winter

 This is how I think it'll go for the power crisis.

Septembers in Germany usually aren't that cool, and you marginally heat your apartment/house in the month.

So, you come to October.  Most people will heat to some degree.  This new strategy will be to marginally heat four to six hours a day with natural gas out of the furnace, and then arrive home at 5 PM....to lightly use a medium-wattage heater for the living room.  A few blackouts will be reported around Germany for the month.

Then you will come to November.  People will have two to three electrical heaters....maybe flipping them on for 30 minutes around 6 AM, and then for two hours in the evening.  These blackouts will increase at this point....some for fewer than three minutes....some going to an hour.

December?  Now, things will get serious.  You probably will have two big-watt heaters in the house to flip on at 6 AM....triggering early AM blackouts, and repeat later at 6 PM.

January and February will probably see a hundred blackouts per day....with people trying to manage a 50-percent use of their natural gas furnace.

Spring will arrive by mid-March, and the blackouts rapidly decrease.

Success?  Some big speech by the Chancellor will occur, with everyone getting a pat on the back. 

The Putin-analysts?  They guessed wrong that Germany would fold, and missed out on tons of natural gas sales. The Russian recession.....as bad, if not worse, than the German one.

Finding restaurants and bars with marginal heat?  I think most will heat to barely 15 C (59 F).  Some will have a sitting fee of 3 to 5 Euro added....to cover the heat cost.

The concert situation?  Most are cancelled by mid-December because of heating cost. 

The fracking business?  I think the public will demand fracking be allowed in Germany, and massive anger will build with the environmentalists hyped-up to prevent it.  

All of this leading to a mess in the Schleswig-Holstein state election?  Yeah....I think both the SPD and Green parties will lose support in the May election.

But here's the thing.....whatever occurred over this winter, will likely repeat for the winter approaching in 2023.  

Liz Truss: UK's New PM?

 At best, I think she's simply a 'filler' for 18 months.  By the end of 2023....she's gone. 

Next official UK election?  January 2025.

The energy crisis for this winter will collapse support for her and the national policy.

My Description Of How The Ukrainians Have Outplayed The Russians

 I could make a 300-page book but I'll limit to five central things:

1.  The Russians had a cut of every military budget for over thirty years.....where probably 25 to 35 percent of the funds were diverted to Oligarch 'crews'.  The superior tank (on paper) came with several diminished features, and didn't meet the original intent.  No one cared to inspect or audit the product....they just accepted it.

2. The Russians ran the same basic exercise theme for thirty years....a tank-war.  They never made them challenging, and the generals didn't worry about war.

3.  The Ukrainians got superior intelligence from outside nations.  Advice was given on a daily basis, and they evolved.  The Russians have marginally evolved.

4.  Russian conscripts were marginally trained, and fell to the challenge required.

5.  There's no doubt that Putin is ill and lacking the strength that he had a decade ago.  State TV makes up for this....but Ukraine's 'boss' is out in public daily and inspiring people (something Putin can't really perform to).  

How Does Germany 'Short-Time' Work Function In A Recession?

 Around the period after WW I, the Weimar Republic invented this gimmick for industry workers in the middle of a recession.

Basically, the plant or industry would admit they have issues and don't need to produce 100-percent of what they were doing.  So they sign a piece of paper, and state that they think things will improve, but rather than lay people off....you give them a lesser schedule (maybe 8 hours a week.....maybe 16 hours....maybe 24 hours).

So the government then steps in and provide an allowance to the workers to cover 'most' (not all of normal pay but covers a big chunk).  You do make less, and on average...it's probably 20 percent less income.  Guys on short-work don't buy new cars, or take vacations.  

Limited time for shot-time? Oh yeah, max of 12 months unless the government writes a waiver for a longer period.  

The positive side?  Most recessions....don't go past six to eight months.  The negative?  You are paying a fair amount of tax into a pot to cover the day where this might happen.

How many times in your life....might this be triggered?  For my wife, mid-50s, she's probably done four occasions of short-work.  Some were 90 days....some were eight to nine months.  

Nuke Plant Chatter

 Starting 1 January....one of the three remaining nuke plants in Germany will shut down....while the other two are kept on stand-by 'alert', to be cranked up if necessary.  Well....this is the plan but it has yet to be put to a vote in the Bundestag, and the FDP Party isn't really supporting it.  It's a Green Party plan (they run the energy grid business for the coalition government).  

So today, the question came up.....to run two nuke plants, but produce NO electricity....what's the cost....per day for the two to operate?

500,000 Euro (roughly a half-million dollars....per day, for the two).

Getting people peeved?   Oh yeah.....for 90 days, they are flushing 45-million Euro down the drain.

Odds of this passing via the Bundestag now?  I'd give it less than a 50-percent chance.

So as a minimum....the two ought to be turned on, and allowed produce power, without any discussion.  

This getting to a page one situation?  Currently, I'd rate this as one of the top ten issues under discussion in Germany.  Just about everyone has an opinion.  

The fact that they already have the rods to run the systems for one quarter?  That's another part of the story which is lesser presented to the public.  

Ten German News Stories

 1.  The German shoe company....Gortz?  Bankrupt as of this morning.  Been around since 1875.  They had around 2,500 employees on the payroll.  Fairly well known company.  

2.  The Maischberger public forum show from last night (ZDF, Channel Two)?  She had the Economics Minister/Vice Chancellor (Robert Habeck, Green Party) on (live) and had a 12-minute conversation.  Lot of talk over the nuke plant business, natural gas, the grid, etc.  

At some point, she just started laughing at his explanations/details, and this rattled him off a good bit.  He couldn't concentrate from this point on.

I sat and watched this.....pretty dismal situation on the interview, and it had to unnerve Germans watching it.  Luckily, it's after 10:30 PM and probably 95-percent of Germans were watching something else, sleeping, bowling, or playing cards.

3.  Lot of hype going on in Berlin about a reform to work-visas....where a qualified non-German would be recognized and granted the visa.  Chief reason for this enthusiasm?  Government is now admitting they have a shortage in dozens of areas, without the population in Germany to do the job.  Where these people will come from?  Unknown.

4.  This blackouts threat chatter?  You know....up until the past week, it was rarely mentioned.  Now?  Via the news folks and social media.....it comes up a lot.

5.  Review of European nations on returning 'ordered-items' (like Amazon)....shows that Germany is 'king' of returning items.  They figure around a quarter of orders get returned.

6.  Weirdest thing discussed yesterday?  Habeck (Economics Minister) suggested that details are being worked for oil-powered 'rigs' to produce electricity....off-shore and far out into the sea (away from Germany).  

7.  Belief that the nuke plan.....of the three remaining operational plants....one will close on 1 January, and the other two will shut down by April 2023.  Public confidence is crappy at present, and no one believes the FDP Party will agree to the Green Party plan.

8.  Yesterday, officially, Chancellor Scholz rejected the reparations business that Poland brought up. 

9.  It came out yesterday that the 'mother' of the public TV networks (ARD)....knew for years about the RBB (Berlin public TV) network's bonus program.  Not a lot of details laid out but I would imagine the names will be printed somewhere and those folks will resign shortly.  

10.  Federal government says shortly, the requirement to wear Covid masks on planes....will end.  This triggered the train folks to demand that requirement end as well.  

For bus and train travel, Covid masks are a mandate.  If you asked me about grocery stores, it's still optional....probably a quarter of customers still wear the mask. 

What Was The Actual Affect Of The September 1929 Stock Market Crash On Germany?

 Well....rather than making this a 40-page summary, I'll try to limit this to forty-odd lines.

Officially, WW I came to a ceasefire in November 1918.  The real treaty?  It could not be signed until Germany agreed to 'pay' the US, France, and England a 'sum' of money for causing the war.

German troops?  Almost immediately in November of 1918, they packed up and went home. For the next six months, especially around Hamburg, Augsburg an Munich....civil war was potentially a problem.  Around March/April of 1919....the federal government of Germany came to ensure 'peace' and the potential for civil war ended.

Then this long five-year discussion took place over the payment situation.  The British finally brought a retired US general who had US bank connections (in NY City) into the situation, and worked out a 'deal'.  Germany would promise to pay a loan that would require thirty years.  The US banks paid the money straight to the US, French and British governments.  

It's safe to say from 1925, to 1929.....things were on turbo because of that cash-flow to the government.

When September 1929 came around.....the NY City banks were short on cash, and went to the Germans to demand some type of settlement.  The coalition government that existed?  They talked for days over this.....but could not manage a joint decision.

The government (coalition of several parties) fell apart by March 1930.  Normally, there would be an election to resolve this.  The President of Germany at the time said no.....he'd grant 'powers' to the SPD Party (who held the most votes out of the last election), and they'd create a fix to recover from the bank discussions.

You can argue about the 'powers' invented today....lot of criticism that this was a faulty decision, but you could waste another six months for an election and a solution.

As soon as the fix was accomplished....the SPD folks said 'enough', and demanded a new election....thinking it'd help smooth things out.

Well....this moment of weakness seen, was what triggered the Nazi Party to get bold....advance their platforms, and from 14 September 1930 (election day)....the stability of Germany was in doubt.

The SPD Party was never able to resolve the confidence of the public, and the bank loan from WW I.....is what really triggered the Nazis to arrive, with Hitler.

There's probably forty key names out of this period (1918 to 1930), and it misses this really great economic period in Germany from 1925 to 1929....but the crash triggered WW II to occur in the end.

Radio being a big part of this whole story?  Radio sales and stations....didn't really start until 1925 in Germany.  From the beginning....until the Nazis arrived to change the regulations....there were enough laws in place to prevent political parties from using the radio from 1925 to 1931.  After that point....radios figured into the propaganda world. 

We may not grasp this today, and historians have tried to avoid the 1920s because of the financial mess created by the US, French and the UK....but bread-crumbs were left to hasten another war because the first one didn't fix the mess.  

Seven Questions From The German News Of Today

 1.  Nuke plant business settled now? 

NO.  Apparently the plan to keep two plants open to 1 Apr....closing one plant by 1 Jan 2023....is not selling within the coalition (FDP asking too many questions).  Wording now says that the two plants will operate but produce NO electricity.  If FDP doesn't agree?  It just makes a bigger mess out of the decision.  

2.  The Ukrainian nuke plant at Zaporizhia now under threat?

Well....WELT is saying that the locals now believe a meltdown is possible.  As bad as the war has gone, it would gone into a massive tailspin if the meltdown started. 

3.  Does German care that Prince Harry/Meghan are in Dusseldorf?

No.  It's page four news and beyond the city of Dusseldorf, I don't anyone much cares.

4.  Speculation that Russia is running out of ammo, conscripts and equipment?

There are probably twice the number of reports as in August....viewed by Germans.  Whether they are BS or not?  Unknown.  Brain-drain from Russia going on?  Not much doubt to that at this point.  If you were into IT in anyways....you probably have left, or have plans to leave shortly.

5.  Poll showing disbelief of relief by the government....to come to the ordinary German?

Well....N-TV did a poll, and it shows only 2 percent think the government is truly helping the ordinary citizen in Germany.  Pretty crappy numbers.

6.  NFL on German TV rock solid?\

RTL announced today....the 2023 season is theirs.  Now, if you asked me on the fan-base?  It's hard to say.  The NFL says 19-million Germans are 'fans'.  I think that's mostly BS.  One big issue....Sunday afternoon games fit the German deal great (10 PM usually), but then you come to Monday night games (at 3 AM).....that's a crappy time.    

7.  Some kind of national plan to replace the summer 9-Euro a month Bahn-card?

Well....there is talk of a regional ticket to be offered (nationally) for 29 Euro....meaning you were grounded to something like travel only within 30-odd kilometers of your home.  The full-nation ticket?  Would revolve around 49 Euro, but with no ICE or inner-city rapid-rail.  

Making people happy?  No.  For some reason, they like the chance to board a regional train and travel several hours....for a ultra-cheap price.  

Russia - Germany Relationship Permanently Ended?

 Russia says Nord Stream I (the natural gas pipeline) today....will not be turned on until sanctions are lifted.

What will happen?  The Germans will grumble....go shopping, and have a rather miserable next 18 months.  They will eventually climb out of this mess, and from that day forward....I don't think any relationship or trade situation will ever occur in our lifetimes.

Putin thinking he has the better cards?  Yeah, I think the Oligarch crew around him....continually hype this, and he believes it.

Anything to change this?  Unless Putin passes on, no.

In Putin's mind.....I believe that he sees this as 1980s style Soviet-management....where you don't worry about capital or trade....you just print money and keep your state TV crew busy telling only your story.

The folks in Germany who hyped this trade situation for fifty years?  Yeah, you can dish out blame on them for what they did.....but it doesn't really change much of anything. 

It'll be a long miserable winter....suck it up and just make due with what you got.

Russia Number

 I noticed this on N-TV news in the afternoon.....the Russian statistical authority says that 419,000 folks left the country in the January to June period of 2022.

A true number?  Well....it's the government's number and I doubt that they'd really want you to know this.

Now, compared to 2021?  There were around half this number....at least the same source said that.

If it were true?  I would go and speculate that the 1 January 2023 number for the whole year will reflect near one-million.  If I were in the young male age group to be drafted?  Even a higher chance of me leaving.  

Blackout Chatter?

 For those who didn't know.....J P Morgan has a major presence in Germany (Frankfurt).

Today, they openly admitted they are discussing contingency plans because of blackout potential....to move operations out of Germany.

Location mostly mentioned?  London.  Yeah, kinda comical.  Everyone in Germany hyped-up the need to leave the UK because of BREXIT and now it is returned for the grid issues forecasted for the winter.

Most of the major 'players' of Frankfurt's business sector have generators and it's hard to gauge how this topic came up.

A real threat?  At best, I'd say several evening blackouts will occur because of people trying to use electrical heat....more than normal.  I don't think this will be a big deal in the daytime.

But here is the thing....other companies will now wonder, and take precautions as well.

Fracking Likely In Germany To Be 'Pushed'

 For over six years, fracking in Germany has been illegal, and a very negative topic with SPD and Green voters.

I would speculate at this point.....by January, it'll be a major topic in at least five German states, and political will be a problem.

So I offer the opinion that by late spring of 2023....fracking is going to be approved in some form.  The Greens will probably into a tail-spin by summer of 2023, with a lot bickering seen on public TV.  

As for the fracking having results by the end of 2023?  That's where I'm going with this....the results will just start to roll in by that point, and probably create a serious change on natural gas/oil pricing (dropping like a rock).

So the Russia and Qatar edge?  Well....their pricing will drop like a rock in the first quarter of 2024.  

Note: There are only three state elections in 2023: May election Schleswig-Holstein, fall election in both Hessen and Bavaria.  If you wanted to judge discontent.....I would watch these three elections closely.

Geek Stuff

 German science geeks have sat down and examined the idea of re-using the hot water that is generated from washing machines, and dishwashers.  

I pondered over this story. 

In some homes, say where the family is six or more people.....you'd be running the dishwasher and washer....on a daily basis.  

I sat four years ago, watching some German reality TV show with a family of twelve and the mother had at least two washes every single day.  

What'd you do with the hot-water at the conclusion?  The geeks think they can develop some heating unit (I assume a radiator) for the situation.  

Five German News Stories

 1.  I noticed this AM off Focus an odd story related to the Ukraine-Russia war.  Focus says....US intelligence thinks the Russians are buy artillery and shells from North Korea.

I pondered over this.  They probably looked at freighter action at ports and could make some judgement like this.  How the Russians paid them?  Well....I would assume in oil via tankers.

But the question comes up....can the North Koreans produce quality artillery pieces?  I would assume here....they probably produce at the level of the 1950s/1960s, and there might be some serious flaws with quality of production.

Then you come to the shells.  If I posed this scenario to some US Army captain, and asked if he'd go and fire NK shells himself?  There's probably going to be a long pause, and he'd probably admit that he'd rather not fire them (quality concerns).  The Russian conscript?  I'm sure he'll do without any hesitation.

But here's the thing.....after you have a couple of episodes where the shell explodes in the artillery piece, and shrapnel kills a dozen conscripts.....there won't be anyone volunteering for this type of duty.

2.  This press conference that Economy Minister Habeck gave yesterday in Berlin?  It probably frighten the crap out of half-of-Germany.  He basically gave the worst-case scenario for this winter....where electricity might be 'iffy' on a hour-by-hour basis.     I can't imagine a hundred days where you sat and fretted over each single day and how your power situation might go.

3.  From the protests in Leipzig yesterday?  I'll just say it was an odd situation....where roughly seven different protests were running.....all in some extreme negativity of the government, from the far-left, and the far-right.

Police were guessing the total numbers, in the seven-thousand range, which was pretty good for a Monday situation.

4.  Lufthansa pilots are talking about a two-day strike (very shortly).  

5.  Habeck's suggestion of keeping two nuke plants open in 2023?  Well....a lot of criticism is occurring with Green Party folks, and if put to a vote....I'm not sure the proposal can survive.  

Sticker Shock - Natural Gas

 Last night, late.....I watched RTL's 'Extra' show, which featured a good 15 minutes of talk on natural gas pricing, and shock.

So here were these Germans getting their notice for their quarterly pre-payments, to start in October.  

Most were getting a somewhat normal situation (190 to 225 Euro) for the October payment.  Then came 1 January's payment.....where it went from roughly 200 Euro up to 830 Euro (roughly).  So instead of a full year being in the 900 Euro range, this was going to be in the 2,600 Euro range.  

For one couple, this meant moving their summer 2023 vacation money....over to natural gas heating instead.  Total shock.

One retired couple, with a house of roughly 160 square meters, had sticker shock at 9,000 Euro.  

All of them could probably meet the one-time situation.  I would imagine some folks will be picking rooms out of the house to heat less.  Some houses will probably be heated for only 12 hours out off the day....not 18 hours.  

The question then arises....what happens in a year?  Repeat?  If you 'raid' this guy' summer vacation fund....does it harm the vacation industry in the summer of 2023? 

If this is the normal and 83-million Germans get this type of notice....there's serious consequences coming for the political system in 2023.  Election-wise, there's going to be harsh reminders put forward.  

A new and bigger recession?  I would go and suggest this.....but you need to invent a world for inflation of this type.  (MEGA-inflation?)

I turned to my wife and asked if she'd gotten her letter yet.....'no' came the answer, but it should be happening by the end of next week.  Sticker shock for us?  Probably.  We probably will go to four three-hour periods of heat, and use a electrical heater for the kitchen.  

Footnote: I expect a massive halt on purchasing homes of 100 square meters or more, and this real estate development will have dire consequences for people with larger homes.

Olympic History Piece (1972)

 How much of the Munich (Germany) massacre attack at the 1972 Summer Olympics.....with the eight folks of the Palestinian terrorist gang Black September....involved the German Red Army Faction?

Well....the chief demand of the terrorists was....let the 234 Palestinian prisoners held in jails in Israel go, and the two Red Army Faction members held (Andreas Baader and Ulrike Meinhof).

This rarely comes up, and if you quizzed most Germans....they don't remember this part of the massacre at the Olympics.  

The ending of the attempted exit?  Three of the Palestinians survived, and were 'traded' around two months later....for the hijacking of a Lufthansa flight.  After this release....Israel had a new policy....basically to hunt down anyone connected to the Palestinian group....who was involved, and terminate them. 

Baader and Meinhof?  Dead in prison by suicide in May 1976.  At least, that's the official version of the story.  Some may disagree, but that's what the police reported.  

The handling of the Munich situation?  For years, this was a 'mess' and was continually brought up that the German police were not capable of handling these situations.  

What Habeck Said Today About Nuke Energy Plants

 FYI, the last three nuke plants in Germany were set (years in the making) to shutdown by 1 January.  

Lot of chatter about a lack of plan-B situations for the grid.  So today, the Economics Minister (Habeck, Greens) said that only one plant would close for sure....the other two would be put on stand-by.  No one said a year, or two years, or three years, for stand-by status.

The one plant to shut down? In Emsland....far NW of Germany.

Settling things?  Well...the Bavarians wanted their plant to stay open (providing 25-percent roughly of Bavarian grid requirements).  So I think they are satisfied.

A cost factor?  Yeah, that's the one odd thing that the journalists failed to mention.   

Insolvency Story

 For 94 years, Hackle (the company) had been around Germany.  This afternoon, they declared bankruptcy.

Their products....mostly all paper.  Toilet paper was a big deal for them.  

They simply say that natural gas cost made it possible to stay on a schedule.

Government's problem?  Well....they will assign a lawyer to be the CEO, but it's hard to see what you'd do to change anything.  Government will pour in cash to keep employees working (to some degree).

I should note this as well.....they cited a second big reason in their paperwork.....the ability to do logistical situations.  

If you go and chat trucking companies presently....most everyone will say that it's a mess, with a declining number of drivers, and inability to deliver on schedule.  This is not a regional issue....it's a European-wide issue.  

Five Russia Questions

 1.  Is there any chance remaining of Russia ending up with a victory?  

No.  

The 10 day war is now on six months, a week, and six days.  

While the arguing over lost tanks is worth discussing....once 1960s-era tanks started to be seen a month ago in the war zone, you can assume that probably half of the tanks have been lost to damage, or just left in the field because of a empty fuel tank.  

Some people have pointed out....tank crews are probably marginally trained and it wouldn't take much to abandon a tank in battle.  

At best, I would suggest that the Russians are in a 'cannot-admit-defeat' situation and only with Putin dying or passing on.....can we move to the next step.

2.  Is there any planning around the day of Putin being gone?

I would suggest that of the top hundred Oligarch folks.....virtually all of them are having weekly chats with Duma people, and the topic comes up.  There's probably a list of people, and I think the intent is to find one temp-guy to fill the shoes for six months, then have a election to solidify the Oligarch-picked guy.  The temp-guy won't be a big name figure and is probably a 'friend' of some sort of Putin right now.

3.  Is public support rock-solid for Putin presently?

Russians are both sarcastic and skeptical.  Just because Putin might pass on, no one really expects 'change'.  

If you assigned propaganda value to state TV?  Probably half of the over-30 crowd in Russia is in belief of what they see on TV, and that Nazis are everywhere in the Ukraine.

4.  Is there one sign of hardships to come for Russia?

Ball-bearing-wise, the freight-train situation is a question mark.  In the past month, around 10-percent of the trains have been removed because they can't produce quality ballbearings.  This will escalate in the fall, and you can figure 50-percent of the railway system is going to be locked down by 1 January.  Maybe China can pick up this business....maybe not.  Funny how this one key thing popped up.  

5.  The belief by Putin that he can influence Germans to lessen their support for the Ukraine?

He may have this opinion, and still believe Germans are weak.  But there has not been any signs of Germans giving in.  

E-Car Chatter

 I noticed off N-TV this AM....chatter of a change coming for LIDL (grocery chain in Germany) and E-car charging.

For several years, LIDL spent time and money to put up charging systems...for E-cars, which got the juice primarily off the roof solar panels of the grocery.

Starting here in a week, there is a fee for the recharge.  It won't be free any longer.

The deal?  29 Euro cents per KwH....up to 43 Kilowatt hours.

For an average charge (not a full charge), you'd still probably only be talking about six to eight Euro for a medium charge.  It's not outrageous but it starts to make you think where you charge, and what the rates amount to.

How I Think The German Public TV 'Scandal' Will End?

 About every three to four days, another 'shoe' drops and some other issue pops up.  

At the national level, there's a 'governor's board' which is supposed to be made up of 50 to 60 individuals.  They are appointed by various groups, which typically simply had a overview of what was going, without weekly meetings or hyped-up circumstances.  

I suspect by the end of 2022....the board will admit that it's not built to handle real audits or overviews.  Then they will say that some type of truth-commission has to be created to go and spend six months really pouring over the spending of funds, and the neutral news reporting.

At the conclusion of this review, it's going to be hard for ARD/ZDF (the two 'mothers' of public TV) to continue 'as-is'.

I suspect three key things will come out of this.  

First, the 'governor's board' will be told that it's not really built to do the job required, and it probably should be no more than ten people, with a full-time job to perform oversight.

Second, both ARD and ZDF will be told that this reform they've discussed for thirty years and never really done.....is now beyond their capabilities, and it'll be drafted by the board, and handed to them.  It probably won't be a pleasant experience, and the two news teams will be in the middle of this reform.

Third and final.....public radio in Germany is probably going to change in a major way, with less content.  There is a need for regional news and forums, but beyond that.....other than culture items....the rest of the job can by done by private radio stations.  

As for the media-tax downsizing?  I would take a guess by 2024, maybe a 5-Euro decrease on the monthly tax.

The public TV/radio folks grumbling?  Oh, this will go on for years, if not decades....how the empire fell apart and was screwed-over.  They had hints given to them almost yearly, and just grinning....as if the atmosphere was 'blessed'.  

City Trend

 Pretty wild weekend in Wiesbaden (my local town):

1.  Grocery fight.

2.  Guy attacking random people on the street.

3.  Two gangs fighting in the city park.

4.  Guy attacked by three hoodlums.

5.  Beer bottle attack on guy.

6.  Argument leading to fight.

Perception?  Well....twenty years ago, it was rare that the police got called in town to an authentic fight on the street.  Now?  I'd say from Friday night to Sunday night....there's probably a minimum of five 'events' that occur, and some weekends....it's up to a dozen.

Some of this is Covid-relief or people just stressed out....drinking excessively, and doing stupid things.  Most of the perp's and victims?  Between the ages of 15 to 35.

A  trend?  I think the police would say that their job and stress have gone up, and it's a bad trend.

In the case of the grocery attack....this was a kid who was on a banned list, but noted in the store.  They simply went to the kid and asked him to leave.....he reacted by kicking the employee in the shin, and then all hell broke loose, with the police arriving and some kind of assault charge now likely out of this fracus.

No one says much of the banned list, but I would imagine more than 300 people from the city are on some store's banned list now, and it begs questions of where this trend is going.

When Someone Discusses 'Excess' Profit

 Every time this topic comes up of excess profit.....I think of Chuck Taylor All-Star tennis shoes.

As a kid, they were available in rural Alabama for around $12 (early to mid-1970s).  Out of this....the store probably took a $1.50 profit angle, and transport probably ran in the 50-cent range.  Actual cost of making them.....in Asia?  Probably at that point in the $6 range.  So the company probably was taking in the range of $4 of profit.  Adding to this.....the 6-percent state and local sales tax, on top of the sales price.

Today in Germany?  The high-top red Chuck Taylor tennis shoes run at 55 Euro (tax added already into the price).  The Asian company with the profit?  it's probably 20 Euro minimum, but even the store-front is taking a 5-to-10 Euro profit onto this.

Some of the upper quality or 'look' CT-shoes will even run 75 to 100 Euro.  

Yes, all of this from a simple design....which you can probably make for about 20 Euro, in some sweat-shop in Asia.

The problem is....who will be the 'judge' over this, and just how much profit will you allow the shipping company, the sales-front store, and the manufacture side?  And why is your judgement better than other people? 

I got fixated on this trend back 25 years ago, as my son got into Dragonball-Z cheapo shirts....made of 100-percent polyester.  It was a 7-Euro shirt which the stores refused to sell for less than 25 Euro each (when it was trendy).  It was stupid to me to spend 50 Euro on two of these shirts....which were a stupid design and cheaply made (neither lasted more than a year).  Someone stepping in to prevent excess profit?  No.

There is a point to the excess profit angle, but you open up a lot of doors....which people just never considered before. 

Leipzig

 Today is the last day of the Leipzig 'trade-fair', where the motto for this year's display is 'Modern, Flexible, and Diverse'. 

Adding to the fair?  Well....police say seven different demonstrations are planned in different parts of the city.....from far-left, to environmentalists, to far-right.  

Probably a good bit of overtime for the city police.  

Return To School?

 Today is the return to school day in Hessen.  It would normally be the day that I'd go to the mid-town area of Wiesbaden....at the bus-stop, and gauge the attire situation for 12, 13, and 14 year old kids.  On shock appeal?  Oh, it's a solid '10'.  

This is the day that all of them go and push the limits, with parents giving a marginal 'thumbs-up', and then laying down the attire rules for the rest of the year.

Four years ago, I noted the attire situation had swung to the Japanese anime/cartoon level, and probably 10-percent of the young ladies dressing like some Japanese character.

Three years ago, before Covid, I noticed some minor trend toward leather-and-bondage look, which I doubt if the girls even realized the selected apparel.  

For guys?  One year, there was some trend toward nylon work-out pants (the cheap 10 Euro type).  

What The Relief Measures Appear Like?

 Basically, four things:

1.  There's going to be 1.5-billion Euro shifted to the 16 states for new monthly Bahn/bus ticket schemes.....in the 49 to 69 Euro a month range.  

Helpful?  Most people will respond it's too much for the cost.  They wanted the 9-Euro monthly tickets, and it's just not going to happen.

2.  Kid benefits per couple?  Going up by 18 Euro for the 1st and 2nd kid.  

3.  Some kind of housing/heat 'check' will occur....figure for a 1-person apartment....around 415 Euro, and 540 for two people.  Would pay out by end of the year.....program then ends.

4.  Pension folks would get a 1-time check of 300 Euro by the end of the year.  Students and trainees would get a 1-time check of 200 Euro.  Strictly to cover energy cost, but I doubt if it even starts to cover one-third of the problem.

All total?  In the sixty-billion Euro range.  My humble belief is that it'll come to a January meeting, with another sixty-billion required to make people happy.

Political Polling

 INSA, the polling organization did a poll (published this AM) with the political slant of the country.  If an election was held today in Germany.....the coalition group (SPD, Greens and FDP) would only get 47-percent of the national vote

A shock?  Not that much.

One could make the case that Scholz isn't readily selling on his 'brand', and the group chaos is readily shown on a daily basis to the general public. 

If they were to falter and new elections were held?  The CDU would likely come out ahead and it's be fairly doubtful that the SPD would get any real attention.  

Closures Story

 Covid changed a lot of things on the German landscape.  This week....our regional public TV folks (HR) did a long talk about approaching bankruptcies in the state of Hessen with hotels and restaurants.

So here is the deal...a fair number of them are writing up the bankruptcy paperwork and will file in the next six months.  

How it looks?  Around fifty percent will dissolve.

Most are blaming inflation and energy cost.

Natural gas cost estimate?  It's nine times what it was in 2020.

Where this is going?  At a minimum for those who survive....massive increases in cost will occur.  Hotels will swing prices up per room, and a simple dinner at a restaurant that used to be 18 Euro per person (with a drink) will probably go to the 25 Euro level, and beyond.

It wouldn't shock me if I walked into a restaurant in January, and the heating was lowered to the 16 C (61 F) level.  

Shocking some folks?  Well...you could be in what was a tourist district ten years ago with a dozen hotels operating, and by spring of 2023....find only six open.  

Surging prices will scare the crap out of some tourists, and it might take several years for them to realize nothing is going back down in price. 

When you start to think about it....a lot of what Germany had to offer before Covid and the recession....brought in a large number of non-German tourists.  But with this new landscape....would you venture to Germany with the prices and lesser options?  

German New Stories

 1.  This AM, the coalition is saying now for the government that a third 'relief' package is being prepared for the public....in anticipation of more recession 'hurt'.

The deal?  Still clouded up, but it appears that retirees and students will get some type of benefit.  It also appears that regulations will be written to give out a 9-Euro monthly public trans ticket some possibility of existing (don't count it being 9-Euro though).  And there appears to be some tax relief being written, but no one says over what. 

More demonstrations likely?  Oh, I'd bet within thirty days, you start to see Saturday protest 'walks' as a normal thing in major cities.  

Details?  To be announced by 11 AM this morning (Sunday) in Germany.

2.  More political chatter within the CDU/CSU parties over the nuke plant closures?  Yeah....with the head of the CDU Party (Merz) suggesting (from yesterday) that blackouts will become routine unless they keep the three remaining plants on-line into 2023.

3.  Via WELT, the German intelligence agency (BND) announced that there are zero indicators to show Putin about to be pushed out of the Kremlin.

4.  WELT article this morning announcing first Germans with long-term Covid being given permanent disability via insurance companies.  

5.  N-TV item from this morning's news....covering Russian demoralization.  The British military have looked at developments and say that the common conscript is not getting paid what he is owed....uniforms are now an issue...weapons and ammo are ify, and food is reaching a serious negative status.  

Limit on Refugees?

 This became a public topic this week in Germany, which surprised some people.

Presently, twelve of the sixteen German states said 'halt' on accepting any more migrants for 2022. Chief reason?  The million Ukrainians that came in this period.

So, the twelve are blocking any more refugees or migrants from getting into the system? 

What will happen now?  My humble belief is that the remaining four states will be compromised in some way....to accept the folks arriving (who may be from any region except Ukraine).

If you were a migrant....say from Iraq, and you wanted to be near your cousins in Hamburg?  Well....you'd get this note (as you arrive) to say Hamburg and eleven other regions are not an option.  Acceptance of this?  I doubt it.  

What's the real number of migrants (Ukrainian and otherwise) for 2022?  Well....all that is publicly stated is that one-million Ukrainians have registered in Germany for 2022 at present.  The rest?  Unknown.  My guess is that in the spring of 2023....they will come around to admit the total number for 2022 was at 1.3-million migrants or refugees.

A national topic?  No....just one stated by the dozen states.

An alarm?  I think the biggest worry is the number of Ukrainian kids in the German school system, and how they handle their school year starting shortly.  To be honest, you don't hear much criticism over the Ukrainians....not for crime, or drugs, or bad behavior.  Housing?  Well....that might be a problem.

Three Interesting Questions

 1.  Is the German government reaching a point where they will set electrical prices from the grid....themselves?

There's a lot of chatter going on, and the word 'intervention' is coming up almost daily.  

What this leads onto is the idea that if they do absolutely nothing....your electrical bill in the spring of 2023 will be up into the thousands of Euro....if people have to use electrical heat more than their actual natural gas furnace in the basement. 

People thinking this would help?  Well....then you get to the tax funding for this and where you will cut the budget...to meet an enormous bill.

In a nutshell, you would create a massive issue with new taxation in 2023.....to prevent people from getting massive electrical bills.

2.  Is anyone much from Germany showing up for Gorbachev's funeral in Moscow?

NO.  It appears that the chief diplomat for the German government will be the representative of the government.

3.  The German Federal Court getting into hotel ratings?

Well....yesterday, what they said in a ruling was that you can't make a rating on a hotel unless you actually were there.

All of these ratings portals are now supposed to take action to ensure the person was physically there.  Making it more difficult?  In this case, if the rating was bogus and the guy was never there.....yeah, you could sue the ratings portal.  

My general advice?  If you spent some time at a hotel, and it was special...it doesn't hurt to say something on ratings.  If you had a negative visit at a hotel....I'd just comment and say 'it didn't meet my expectations' and just leave at that.  Don't say anything else more critical than that.

German School, and Bundeswehr Troop Stories

 First, Hessen came up this week and did the pre-announcement that 25,000 extra kids will be enrolled when school starts next week.

Where they came from?  Ukraine.

Extra teachers just hanging around?  Well....no.  You would be talking about them going out and find another 1,000 (minimum) qualified teachers.  Add to it....most of the Ukraine kids don't speak German.  Somewhere in this mess....there's probably over 3,000 Ukrainian female teachers in Germany, and they will likely rig up some type of employment situation for them.  

Second, the German Bundeswehr (Army) announced that 100 members with 35 vehicles are being deployed shortly into Lithuania....to ensure 'protection' in case Russia gets aggressive.  The end of the story?  No.....at some point in the next month or two.....there will be 2,000 additional Bundeswehr troops placed in Lithuania.  

Is there a threat?  Four months ago, I would have suggested that Russia might have been stupid enough to add the three Baltic countries to their list.  Now?  Not so much.    

Five German News Stories

 1.  EU President van der Leyen is a German, and has a farm-like residence in Germany where the husband and kids reside, while she works in Brussels.  Apparently in the last day or two....the Shetland pony that was a pet of the family, was attacked and killed by a wolf.  It's not page one news, but it's a reminder that wolves are multiplying and becoming a nuisance once again.

2.  The G7 Finance Ministers announced a price cap on Russian oil this week.  The Russians reacted by shutting down the transport of the oil.  I expect by next week....this price cap discussion will be dumped entirely.

3.  Rather interesting story out of Focus this AM....concerning neo-Nazis, or the lack of neo-Nazis.

Back in the summer around Aachen (far NW of Germany near the Dutch border)....this local Green Party political figure....Manoj Subramaniam...started to report death threats being made to him.  Then he brought up mail arriving with razor blades.  Then he reported the tires on his car being cut.  Then came up this swastika graffiti and the term “Jew” written on his car.  

All of this got the police hyped-up, and then came the whole community in a united front against the evil neo-Nazis.  Political figures of all parties were hyped-up and standing tall against the neo-Nazi folks.

Well....the prosecutor there has wrapped up the investigation and says the whole thing was faked-up.  There never were neo-Nazis....which brings them back to the Green Party guy.  

No one says much over what happens next.  Maybe the 'story' of the neo-Nazi thing can continue on, but I doubt it.  

4.  WELT reports this AM that this whole discussion around the natural gas 'extra' levy/tax idea has issues.

It would appear that the Ministry of Economics allowed the gas industry to write most of the wording and formulas....with their own data, and it might not be clear or fair.  Adding to this effort....no one from the customer base was allowed to contribute.  

Probably will force some clean-up of the levy/tax before it is finalized.

5.  Finally, an odd piece....with the potential electrical grid shortage....Ukraine came up and offered to sell Germany some of it's nuke power this winter.  No one says how much, and you'd think that this would get the Russians all hyped-up to take control of these plants.  Cost-factor?  No one says much.

Property Tax Woes

 For those who didn't view the new property tax gimmick in Germany....it is a internet program, and you have to put around a dozen bits of information into the fields....explaining things.  At the end, everyone (literally) will get a whole new property tax situation....some more....a few less.

So it came out today, with the deadline approaching here in Hessen....only one out of five had completed the application.  Yeah, it kinda got the political folks disturbed.

So they've settled upon an extension.

Difficult?  My wife spent around two hours trying to accomplish what they claimed was a 8-minute job.....failing to get it done.  She went to a second day and another attempt.....another two hours....with that failing as well.  Finally, some co-worker suggested one change, and in ten minutes....she was done.

My best guess is that probably a quarter of German society (those over 60) will not be able to do it without some government guy helping them.  I'd also suggest that around 10-percent don't have connectivity or use the internet to any degree.  

My humble belief?  I think by the end of October.....a mass mailing to those left will have to occur, with a card that you'd fill out....for some gov't guy to fill into the software program.  

A Tax That Would Not Be A Tax?

 Well....this came up last night via the public forum show on Germany public TV network....ZDF.  Maybrit Illner was interviewing the EU President....Ursula von der Leyen.

So von der Leyen brought up this idea that the EU was discussing. 

In simple terms, if you were a European (not just German) energy company, the EU would monitor your situation, and if they felt you were too profitable....they would somehow (avoiding the word tax) take excess profit, and 'give' it to people with low incomes.  

I sat there watching this discussion....thinking I must have misunderstood things.  Today, as the language was laid out.....no, that was precisely what she suggested.

What'll happen here?

I would suggest that companies realizing how much they were going to be screwed with....would start to lessen production of energy on their own, and lessen the service/product....accepting less profit....to make a point about who the 'boss' is.

If you go back to California around two decades ago (the Western Company scandal)....this is the game that utility companies played, and lessen production.  It shocked a lot of people.

How you would take excess profit and not call it a tax?  That would a curious thing to have laid out to the general public.  

Then it makes you wonder....whatever this non-tax gimmick is....couldn't you do the same thing to McDonalds, or some German beer company, or Volkswagen?

Then you wonder....who will assess the profit level, and could you bribe them to look the other way?

Then you also start to wonder....couldn't some company crank up various fake costs into the product/service....that simply hid what the real cost was?

This might be an interesting era to watch, and see just how much of a mess that regulations and non-taxation-taxation can be manipulated.  

Two Odd Stories

 1.  It came up this morning as a EU note....they are working on an agenda where the EU could stage a crisis call, and then hand production companies in various countries....an order to produce X, at x-rate.

The wording?  The original request would be voluntary, but the EU is writing the code where it would not be voluntary.

Where this leads to?  Well....you could have some EU bureaucrats say that there is a shortage on diesel, and then order certain facilities in France and Germany to produce x-amount.....at x-profit.  The company could argue with 'no', and demand more profit.  At that point, with the wording....the EU could in theory take control of the production business.  

It begs a lot of questions, and they have not handed the draft to individual countries to review.  My humble view is that a minimum of three countries will refuse to accept this idea.

2.  It came up as a discussion item today....who will go to Gorbachev's funeral in Russia, and will Putin ease restrictions.

Under normal conditions (no war), I think the entire cabinet of the German government would have boarded one single plane and gone to the funeral in mass.  Currently?  I doubt if Scholz goes, and it might only be a bare minimum of folks.

Five German News Stories

 1.  This chatter by the FDP Party of dismantling of the Nord Stream II pipe (the Russian pipe bringing natural gas into Germany) and installation?  Well....I think it's just BS.  First, someone would have to fund this, and it'd trigger a big conversation about wasteful funding.

2.  From the Maybritt Illner public forum show on ZDF last night (10:15 PM), it was an odd piece.  Roundtable talk, on the topic of energy, and the worries of this approaching winter.

Luisa Neubauer from Fridays For The Future, was there.....hyping the promise of the Green Party to stand against nuke energy.

It seemed odd....a long panel group talking over this, and no one really an energy expert to the degree you'd expect.  Mostly just a political chat group.

3.  WELT piece this AM says that a poll was done showing almost two-thirds of Germans are now giving failing grades to the coalition (SPD-Greens-FDP).

4.  This reparations to Poland chatter (from WW II)?  I'd say it's mostly a card being laid down for the Germans to lessen their negative rhetoric from the past seven years.

First, there was intense criticism dumped on Poland for not taking in refugees.  Poland, Czech and Hungary said 'no', and faced down the EU drama on several occasions.  This 'good-neighbor' talk uttered last night?  All that criticism from 2015/2016/2017 adds up.

Second, fresh new criticism started up in the past two years as Poland reformed a number of things which rebalanced the government toward the right.  German political hype went pretty negative at the time.

So, this 1.3-trillion Euro reparation thing will be dangled continually when the Germans slip back to criticism over Poland.  I don't think anyone really expects Germany to deliver a Polish reparation.

5.  Shutting down schools over Covid chatter?  Well....the state of NRW is openly talking about a plan.  It has a lot of criticism attached.  It's hard to find anyone who is enthusiastic about more school closures this winter over Covid. 

Blackout Chatter

 Focus ran a piece this AM entitled: 'Blackouts in Winter'. I'd recommend a read.

This centers on the limits of the German grid and how increased usage of electrical heating would draw upon the situation.

Regional blackouts?  Typically in Germany, in a five-year period.....usually from storm activity, you might have one or two blackouts....taking around 30 to 60 minutes to bounce back. 

My humble view, this is the likely outcome of this grid discussion....except instead of a single blackout in the whole winter period....you might have a 30 to 60 period every single week (probably more so on weekends).  

Dortmund Shooting From 2 Weeks Ago

 Around two weeks ago, I essayed a piece over this shooting of a migrant 16-year old kid by the police, and how it was turning into a major investigation, with locals a bit peeved how it was handled.

So today, via Focus....the rest of the story came out.  Remember now, as the police stated from day one....the kid had mental issues and had been that way since the day he arrived in Germany.

The cops got this call....come over to this building....this kid is threatening suicide (by knife).

They arrive.  They try to converse in Spanish and German.  The kid speaks neither language.

First reaction by the police?  Well....tear gas cannister.  I sat and contemplated this.  Really, I can't think of this being an ideal first step.

The kid reacts, and then starts to step toward the two police, with the irritant in his eyes, and the knife in his hand.

Cops then use tasers.....which apparently had little to no effect.

At this point, the gun was used on him.  Six rounds fired, from probably no more than 3 meters.

Manslaughter charges being discussed on the policeman who fired.

Police cams? They wore them but did not have them turned on (yeah, that's difficult to imagine).

The fact that the kid had been in a physic ward prior to this, then released?  That's going to be discussed a good bit.

Handling of people who are suicidal?  Usually, you have one person trying to do verbal communications and keep everyone far from the action.  But if the kid didn't speak Spanish or German?  Well....that's another issue.

This case will linger for several months in the local area, and I would imagine the police will be hesitant to walk into some threatened suicide situation after this.  

Von der Leyen Comment

 Comment by European Commission President Ursula von der Leyen today: 

"The skyrocketing electricity prices are now exposing, for different reasons, the limitations of our current electricity market design. It was developed under completely different circumstances and for completely different purposes. It is no longer fit for purpose."

And now?

The German strategy for forty-odd years....was to inch along to 'clean' energy....not cheap or reliable energy.  

At this point?  By spring of 2023, it won't surprise me the yearly electrical bill comes up and it's in the 2,500 Euro range.

If von der Leyen is correct....the plan is no longer fit for purpose....then what is the next strategy?  

You can't talk coal or nuclear....nor can you bring up Russian natural gas anymore.

It's hard to imagine this solution being done without massive regulation....doubling of taxation, and some giant solar panel/wind-power mandate.

Trump, German News and Macron

 I sat and watched a N-TV news piece (German commercial news) and their hype was about President Trump 'knowing' all kinds of sex stuff over France's President Macron.  So then came this speculation (with zero facts) that maybe this was in that vast collection of secret documents that Trump had in his secret-ultra-secret storage room in the Florida residence. 

Facts?  It didn't demonstrate much of any facts.  The news people simply said that Trump seemed to know about Macron's sex life.  Then they brought up some Rolling Stone article (August timeframe) that some file existed at the residence, entitled 'President of France'.

Then the rumor-mill started up that Trump knew of 'indecent' behavior of Macron.

I paused over this.  From the end of 2016 to the election in 2017....there were probably a thousand newspaper summaries of Macron, his situation with his wife, and you probably could have written a 300-page 'juicy' book over what they put out into public knowledge.  All a CIA guy had to do....cut-and-paste the summaries, and put a 'secret' on the top of the document, and 'publish' via some secret network.

To suggest something really juicy via the Rolling Stone article, or the news piece by N-TV....misses the big picture....most everything is already known by the French public, and frankly....they don't care.  

In fact, I think we've cross the line in France where the next President could be openly into bondage, sniffing women's undergarments, wearing leather clothing, flipping from gay to straight and back each week.....to which people would be thrilled with some lusty guy in charge of the country.

(Hint, don't lecture the Germans about this idea).

BS?  Maybe there is some 1-page summary there in a secret folder for Trump to read, but to be honest....French folks probably have a 300-page summary already read, and just grinning.  

Covid Still A Problem

 Yesterday, my local public bus 'empire' (here in Wiesbaden) announced that they've got serious manpower problems and starting Monday....will be going to a Saturday 'lesser' schedule for Monday-through-Friday.  Chief reasons?  Covid, sick-leave in general, a number of rank-and-file drivers who've quit in the last month.  

To run their entire operation (293k in population), they have 750 bus drivers....to run a 5 AM to midnight routine.

What the Saturday schedule business equals?  About 70-percent of a normal work-day schedule, so it's a big deal. 

Starting just when kids go back to school?  Yeah, that came up and shocked people.

But it's the same problem as you have for grocery clerks, bartenders, and various jobs in the region....just not enough folks to saddle-up to jobs. You could go and probably dump another 3,000 people into the local area....and have them all employed within six weeks easily.

The funny thing?  Covid has barely started a trendline back up to where it was in March.  

Public TV Chatter

 If you have paid attention in the past month.....there's a fair amount of criticism mounting over public TV in Germany.  

This morning, out of Focus....a commentary from Hugo Muller-Vogg came up, and I'd strongly recommend a reading of his words.  His chief point?  Both ARD and ZDF....are mouthpieces for the Greens and liberal left-of-center, but we should not dump them entirely.  

His best quote: "The top priority is apparently 'political correctness first, news second'."

He does point out and I tend to agree with that point....where you have a news  segment or public forum....the moderator is normally 'left-of-center'.  After you've watched forty-odd shows....you tend to just grin as the 'lecture' comes across to the audience.

So what Muller-Vogg suggests....don't dump them or have a massive layoff situation....just make them do what commercial TV doesn't do....you know....that classical music stuff, poetry, great literature, theater-opera, etc.  Yeah....lessen all these krimi-shows, Bavarian comedy movies, and do less entertainment.  

Here's the thing, for over 40 years, the public has continually hyped reform of public TV.  The monthly media tax?  It shouldn't be 18 Euro.  The need for forty-odd national radio stations?  Why?  And why spend massive sums by public TV for the soccer league games?  

There's something which needs to be done, but it's questionable if the current crew of managements sees the writing on the wall to bring change.  

The Reparations Chatter

 Poland has decided to hand a reparations 'bill' over to Germany....as of today.  The amount that they feel that Germans owe them?  1.3-trillion Euro.

Naturally, the German response has been mostly 'nein, danke'. 

So, lets reflect back to what happened after WW II.

First, Germany had to agree to hand over around 40,000 square miles of German soil....to Poland.  What'd this amount to?  Looking at a map, it's about one-third of what Poland has for land today.

In this brief period....around 10-million German civilians were given the exit-card....they were not to stay in Poland at that point.

Some private groups have done numbers and even in the past decade....there's been estimates for property damage from the war....totaling around 1.5-billion Euro, which the Poles say should have been paid.

Why didn't Poland ever get paid for damages?  Well...an odd thing in 1953 occurred where the national leadership of Poland....with a 'push' by Soviet leaders....said they didn't want West German or East German 'blood' money.  

Will this turn into a EU matter?  I would imagine they are sitting in Brussels and just grinning ear to ear presently over the trillion-Euro matter.  

The problem here....about every three to five years....German politicians find someone that they feel that they hurt (Namibia, the Munich Olympics participants from Israel, the gypsy folks, gays from old East Germany, etc)....then hustle up another reparations fund.  The Poles probably have a fairly decent case here....but 1.3-trillion Euro?  It'll never happen.

My humble view?  The Germans basically have to shut up and not criticize the Poles on anything....otherwise the reparations chatter will start up.  Even if you suggested something could be on the table.....it's nowhere near that 1.3-trillion number.  I'd be guessing that some ten-year pay-out might occur eventually (say by 2030), and it'd amount to 20 billion each year.  But Germans will go ballistic about how WW II seeps still into their lives and gets more blame dumped up them.

All of this....to hang a 'nazi-tag' on German leadership?  More or less.

Poland population today, compared to Germany?  Germany has 83-million, and Poland around 37.5-million..

On size?  Germany is only about 14-percent bigger in terms of land mass.....so Poland is fairly rural in nature and less populated.

Some people will say....since WW II action, the Communist years....that rural Poland hasn't changed much in 75 years.  So 1.3-trillion might go and resolve that image (at least in their mind).  

Trade Chatter

 Over the past two decades, I've probably read more than thirty articles or sat through twenty-odd podcasts, which hyped the problem seen around the globe of one-way commerce...meaning you had a lot of products, food, agricultural items, oil and natural gas sold by one or two countries.  These were warning people....you need a diversified market.  Who listened?  No one.

In the past month, if you sat and watched public TV news in Germany or sat through public forums....there's been a dozen times when this 'lecture' got uttered yet again.  The chief blame?  At Ukraine and Russia.  

I sat through one of these forum situations last night....maybe 10 minutes of value, where they hyped on this once again.  

Lets be blunt....no one from any political party in Germany is listening.  

About four years ago, we had this emergency of sorts in Germany, where cancer treatment drugs were in short supply.  The logistical path had slowed down, and for about six months....you had doctors calling around Germany to find a pharmacy which had a supply for patient requirements.  A discussion started up....most all drugs in Germany were produced by India or China.....something like 90-percent.  Naturally, you'd think that people would react, and mandate only half the drugs in a German pharmacy.....be foreign imported.  Well....nothing much happened.

At some point in 2021, I watched a German economist talk about soap.  If you went back to the 1970s.....most all soap in West Germany....was made in West Germany.  Today?  The biggest maker and exporter of soap is the US....with Germany in second place.  The odd thing is that Germany is now the largest importer of non-European soap in the EU (yes, while it still manufactures soap).  Course, you could make the case that Germans are the most 'clean' folks in Europe, and soap is a key part of this situation.

In the past week, I spent forty-five minutes in a German grocery store....mostly just pushing the cart for my wife.  But I started to look at labels, country-made-status, and gauge 15,000 odd products in the story.  

From vegetables, there's no issue that 90-percent of the products are German grown.  Fruit is different, with probably less than a quarter of the fruit being regional or German products.  I'd even suggest that one-third of the products come beyond the EU.  If you buy grapes now in a non-growing season....it's good odds that they come from Egypt, India, Ecuador, Chile, or Peru.  

The point I make here.....our lives are attached to a fairly fragile trade and shipping system.  Anything can screw it up, and damage the economy of some country.  You do this at a major scale, and global numbers sink like a rock.

Fixing something like this?  Politicians are probably the last people you want to engage and use as some 'savior'.  

The Energy 'Change'

 If you walk around Germany today (1 Sep).....you might notice a few changes, due to government energy regulations going into effect.

First, once heat is turned on (probably within four weeks across Germany)....areas such as entry points, hallways or technical areas....will no longer be heated.

Second, in all public (state/federal) buildings....the heat will be at a max of 19 C, and with minimum lightning (at least meeting safety needs).

Third, in industry areas where production is done....the limit on temperatures will be 18 C.

Exempted places?  Hospitals or social institutions.

Fourth, those great lights around monuments or historical buildings?  Turned off.

I kinda expect more regulations over the next month or two to occur. 

The Gorbachev 'Thing'

 If you watched German public news last night....it went on, and on, and on....with the reported death of Gorbachev.  

Is there a great fascination with Gorbachev with the Germans?  

Look, from 1947 to late 1980s....the Cold War consumed the lives of West Germans.  Every month, you had some reminder of the Cold War conflict existing and the threat of annihilation existed (with nuke warfare).

So in 1985, there was a speech or two by Gorbachev, to indicate some change coming.  By 1988, the change was unfolding and West Germans saw Gorbachev as this dynamic figure to remake the USSR, and remove the threat.

Public TV news in that period went into overload, and everyone got a dose Gorbachev 'fever'.  

The August 1991 Soviet coup d'état attempt?  Well....it hit Germans hard, and they couldn't understand why anyone would want to take down a great leader like this guy.

As the smoke cleared, the coup failed, but Gorbachev was gone, with Yeltsin in charge.  

So there are these Germans...mostly over the age of forty, and they have this belief of their safety and security improved....because of Gorbachev.  

The insider view?  If you were a Soviet citizen throughout the 1950s to 1980s....the economy was crap.  You had a grocery store that was always half-way empty, and you never felt satisficed.  The system had to change, and the guy who opened this door to dismantle the old system was Gorbachev.  

If you go view Russian grocery stores today?  The bulk of them look like your typical American or German grocery.  Life has improved.  Yeah, Putin might claim the vast amount of credit for that, but Gorbachev started the change.  

Life is different today in Germany.....mostly because the Soviet system was dismantled, and you can owe some of that credit to Gorbachev.  

Five German News Stories

 1.  Gas prices, since the 3-month discount ended last night at midnight?  E-10 fuel this morning is 2.04 Euro per liter (it would have been 1.74 Euro up until last night).

A fair number of stations are currently out of fuel, and if you were hoping to fuel up today.....you might have to go to two or three places before you find a station with fuel.

2.  Lufthansa pilots on strike tomorrow?  Yes, confirmed this morning in the AM news.

3.  Chatter started up this AM of a major Russian military exercise in eastern Russia.  The number of Russian troops quoted in participating?  50,000.  It's reported that China, India and Mongolia are also participating in this episode.

Speculation?  Well....they may say 50,000 Conscripts are participating, but it might not be a true number.  I'd also be curious what tanks they are using and if this is mostly a infantry exercise.

4.  That flight (last week) to Canada with Chancellor Scholz, and Economy Minister Habeck? Well....tons of image/video of them in the plane (while in the air) without Covid masks on (despite a government regulation that mandates it).  The comeback was that the German Air Force doesn't mandate it for their flights.

Well....folks heard this, and then went straight to state prosecutors...lodging complaints that it wasn't legal.  The prosecutors?  They simply say they are reviewing things.  

5.  This effort to lower federal voting age to 16?  The SPD and Greens are hyped up and want the law to pass.  So far, neither the FDP or CDU/CSU folks will agree to this.

Shortly after WW II....the voting age in Germany (1950) was lowered to 18 (from 21) for federal voting.

This is a mixed bag.  Some people believe that if you lowered it to 16, there would be another point or two for either the SPD or Greens.   Some have said if this is legal, then legal age drinking should also be set to 16, and that the driver's license should be set at this level.

Odds of this passing in 2022?  I'd give it a zero percent chance.