Mission Accomplished, Frau Merkel*

It looks like Germany is finally running out the string on its beggar thy neighbor economy:

Germany’s exports are falling at the fastest rate since the global crisis in 2009, raising fears of a triple-dip recession and a disastrous relapse for the rest of the eurozone.

The country’s five economic institutes - or "Wise Men" - slashed their growth forecast for Germany from 2pc to 1.2pc next year, warning that the latest measures unveiled by the European Central Bank will add “hardly any” extra stimulus to the real economy and may be unworkable.

Christine Lagarde, the head of the International Monetary Fund, warned that the eurozone is at “serious risk” of falling back into recession if nothing is done, and is in danger of suffering a lost decade. “If the right policies are decided, if both surplus and deficit countries do what they have to do, it is avoidable,” she said. The wording is a clear call to Germany for an immediate shift in policy.

German exports slumped by 5.8pc in August as the crisis in Ukraine and Russia took its toll. “We’re no longer in a recovery,” said Volker Treier, head of the German Chamber of Industry and Commerce (DIHK). He said geopolitical upsets may have pushed the economy over the edge into a “technical recession”, but added that Germany itself is also to blame for failure to break out of a slow-growth trap. “We have too little investment. That’s been the case for years,” he said.

The Wise Men said in a joint report that the German economy is now in “stagnation”, with unemployment likely to rise next year. “There are no signs of the long-awaited recovery yet. Corporate investment fell in the second quarter and there is hardly any evidence to suggest that this cautious approach to investment will change in the near future,” they said.

Germany has been running its economy by suppressing worker wages and domestic demand, and focusing on exports and trade surpluses.

Of course, that is also what they are suggesting for everyone else in the Euro zone, which of course does not works, because for every trade surplus, there has to be a corresponding trade deficit.

It's a zero sum game, and they have managed to sufficiently impoverish their Euro Zone "partners" to the degree that they no longer can import German products, and now the Germans have no one to export to.

It should result in some policy changes in Germany, but it won't while Merkel is Chancellor, because she has staked her political career on depicting the other members of the EU as lazy and profligate to her constituents.

^*Horses whinnying.