Today the German Ministry of Finance announced that their deficit will be resolved by the end of this year. Due too higher income taxes, Germany was able to realize such a result. That will open new perspectives for the European crisis.
German is the leading economic country in Europe. Not even France or United Kingdom can compete with the German wirtschaftwunder. Not only the better income on taxes but also the lower cost of the European monetary fund, is responsible for the quick recovery. On the other side the Greec perspective is slowly improving.
The Greece situation is still miserable. Their deficit tremendous high, but the harsh language from the other European countries has been replaced with more common sense. Europe is moving forward in restructuring the European debt and giving Greece the time of day to rebuild their economy. That still requires years of reform in Greece, but nobody in Europe considers a Grexit anymore. And that is good news for business. The other trouble maker, Spain, is still trying to cope with their debt which is mainly caused by an overrated real estate market. The Spanish citizen is paying the price.
But slowly after 4 years of crisis a slow stabilization starts to take place. For many too little and too late. The politicians really proved their incompetence these last years, by keep delaying essential decisions such as the Bank union, introducing Euro bonds and further financial restructuring. It can be questioned and many economists do so, whether the debt and extension of the crisis was really necessary, if the politicians took their responsibility.
But the news that German will be out of deficit is good news. If the German consumption picks up, the southern European countries can profit. Their economies depend heavily on the consumption rate in the Northern countries such as Scandinavia, Holland, United Kingdom and Germany. An increase in economic activity in Europe can speed up the process of recovery.