On 9 December last year I wrote that Germany is in recession, while economic and financial policy imagines that things can only go up. Since then, endless nonsense has been written about winter recessions, technical recessions and the like. Economic policy has been able to hide behind this whitewashing by the media. Now Germany is in the midst of a severe recession and it will not be easy to stop the downward momentum because politicians have still not recognised the signs of the times.
The day before yesterday, the Federal Statistical Office reported that new orders in German industry fell again in April, following an outright slump in March. To cite just the most prominent example and Germany’s flagship industry: In mechanical engineering, new orders have now been declining steadily since autumn 2021. In the third quarter of 2021, the index level (2015 = 100) was 125. After six consecutive declines in the past six quarters, the index is now, in April 2023, at 92. This is a real debacle and shows how absurd the hope of the government and official advisers is that there could be upward investment activity by companies this year.