We need manufacturing!

As we keep being told, relying upon financial services and services in general just isn´t the way to run an economy. You have to produce thigs of "real value". Things you can drop on your foot. We have to have a large and vibrant manufacturing sector otherwise we´ll simply not be able to grow our economy.

Commerzbank said output is likely to contract by 6pc to 7pc this year as the global recession wreaks havoc on German industrial exports. Foreign industrial orders have fallen by 37pc over the last year…….

Mr Kramer said Germany is suffering the brunt of the global slump because 40pc of GDP stems from exports. It is heavily reliant on machine tools and engineering that is levearaged to global industrial cycle. "There will be no upward movement next year that deserves to be called an upturn," he said.

The only other G10 country likely to face the same sort of destruction this year is Japan (-7pc), another industrial export power. The bank expects Italy to contract by 4.5pc this year, the US by 4pc, Britain by 3.9pc, and France by 3.5pc.

Ah, ho hum, so much for that theory then.

Back to the drawing board guys!

6 comments on “We need manufacturing!

  1. It’s very nice to have foreign servants. One can dismiss them at need without notice or severance.

  2. But manufacturing will recover and Germany will get her growth back.

    Are you suggesting the good times will return for our financial sector? What, another bubble?

    Tim adds: An important point that rather gets overlooked. We´ve had two great bursts of globalisation, or the international division of labour. Late 19th cent. and late 20th.

    In both the UK specialised in finance, Germany in heavy industry. When the same circumstances lead, again, to the same outcome, you´ve at least got to start wondering whether there might not be a reason for this. I would plump for at least the suggestion that the two places have a comparative advantage. You know, that there´s something about the society that makes finance or heavy manufacturing better done in one place or the other?

  3. “Are you suggesting the good times will return for our financial sector? ”

    No, no never, nobody will ever want money or financing again, can’t happen, nope, nope. Pfah! Tchah! I spit on the very ideas that anyone will ever again lend or invest money for profit or that brokers and middlemen will be required to organize that entirely unwanted and non-existent activity.

  4. Tim,

    The difference between them and us is that the Germans still have drawing boards. Instead of drawing boards, we have worthless economic models written by 22 year old snots.

  5. Fred Z is the winner. Yes, of course FS will recover; yes, of course London will remain the centre of it. I’d stake my life on that, and I wouldn’t stake 5p on any of the other scenarios people are outlining…

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