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Adele Tan Yan Ru --> S10195449
Cheryl Chia Jia En --> S10195293
Reneli Tan Sze Yee -->  S10194693
Ryan Tan Jun Kai --> S10194704
Gerard Tay Hiok Yew --> S10195786

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Inflation inversely related with GDP, therefore when there is inflation the GDP decreases. Using Gerard's article, Germany's GDP growth rate was low and annually, the GDP grew marginally and dropped for two consecutive periods. This could indicate a sign of inflation, as inflation leads to the increase of prices and thus weakening the purchasing power of the people, therefore lowering the GDP growth rate. The GDP growth rate changes were minimal yet fluctuating, suggesting that the rate of inflation barely had a change as well.

Looking at Reneli's article, the decreasing demand of goods could be due to inflation and the increase in trade disputes will just be a negative externality. The U shape recovery of the economy suggests that the inflation rate was increasing and then falling back slightly.

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Hello Team,
The articles are good but prelim analysis room for improvement. There are only two economic concepts covered. You might want to explore inflation.

Please include IDs and full names of all your team members on this wall before printing out for submission.

Please refer to my questions/feedback below. These are also meant for you to explore in your report writing. So wait no further.

Print out the finalised version of your padlet (pls keep my comments) and submit to me by the deadline (pigeon hole at Blk 72, level 9 or pass it to me in
class) and time to kick start your report writing!

Feedback/Suggestions to ponder:

Reneli (GDP)
1. Yes, it is not recession yet in Germany.
2. Why did the demand for manufacturing goods fell? What is this trade disputes that you have identified? How important is trade revenue to Germany's GDP.

Gerard (Also GDP)
1. Yes, not recession technically speaking but a weak economy.
2. Again, what caused the falling economy? Hint: explore this "falling worldwide demand for capital goods, which has hit Germany’s export-reliant economy, along with political uncertainty and structural changes in the automotive industry." , mentioned in the article.

Adele (Unemployment)
1. What caused the industrial sector to cut jobs? (info from GDP above will help)
2. What type of unemployment is this?
3. The suggestions you stated for the Government, do a check to confirm that these are not implemented. Otherwise, turn this from suggestions to "policies government implement to help".

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Germany's economic institutes predictions on future economy growth rates have been reduced. This is due to a decreasing demand for manufacturing goods and an increase in trade disputes. The changes made were that the economy is predicted to grow by 0.5% in 2019 and 1.1% in 2020. The original forecasts were that the economy was expected to grow by 0.8% in 2019 and 1.8% in 2020. Although the economy growth rates are predicted to face a drop in the coming year, Germany is not facing an economic recession as the growth rate is not negative.
The recovery from this recession would be a "U" shape recovery where it can be seen that the economy declines and recovers gradually.

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BERLIN (REUTERS) - Germany's leading economic institutes on Wednesday (Oct 2) slashed their growth forecasts in Europe's biggest economy for this year and next, blaming weaker global demand for manufacturing goods and increased business uncertainty amid trade disputes.

The revisions, which feed into the government's own output projections, reflect growing concerns that a slowdown in Germany driven by a recession in the export-dependent manufacturing sector could hamper the broader euro zone economy.

The institutes said they now expect the German economy to grow by 0.5 per cent this year and 1.1 per cent in 2020. This compared with their April estimates of 0.8 per cent and 1.8 per cent respectively.

"An economic crisis with a pronounced underutilisation of the German economy is ... not in sight, although the cyclical downside risks are currently high," the institutes said.

For 2021, the institutes predict a mild recovery with an economic expansion of 1.4 per cent.

The government is due to publish its latest growth forecasts later this month. In April, it predicted growth of 0.5 per cent for 2019 and 1.5 per cent for 2020.

Earlir on Wednesday, German Finance Minister Olaf Scholz said the country would be able to counter an economic crisis if there were one but added that he did not expect a downturn as bad as in 2008/2009.

"We are well prepared because we have decent financial resources so if there is an economic crisis, we can take countermeasures but at the moment we're only seeing slower growth," Scholz told public broadcaster ARD.

He said if a crisis as serious as in 2008/2009 were to appear on the horizon, Germany would "be able to do everything that is necessary" but added that he did not foresee such a scenario, with forecasts pointing to the economy improving - albeit more slowly than had been previously hoped.

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German institutes slash GDP growth forecasts, warn of high downside risks

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BERLIN (REUTERS) - Germany's leading economic institutes on Wednesday (Oct 2) slashed their growth forecasts in Europe's biggest economy for this year and next, blaming weaker global demand for manufacturing goods and increased business uncertainty amid trade disputes.. Read more at straitstimes.com.

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With Germany facing an industrial recession, the Ifo Institute’s joint economic forecast for 2019, published Wednesday, has been revised down from the 0.8% GDP (gross domestic product) growth projected in the spring to just 0.5%. Reasons for poor performance include falling worldwide demand for capital goods, which has hit Germany’s export-reliant economy, along with political uncertainty and structural changes in the automotive industry. For 2020, the various economic research institutes have reduced their GDP growth forecasts to 1.1% from the 1.8% predicted in the spring. The report also showed that employment growth in Germany has lost momentum as a consequence of the economic slowdown, with the industrial sector cutting jobs, while service providers and the construction sector are still hiring.

The institutes forecast employment growth of 380,000 jobs this year, but in the next two years, it is expected that only 120,000 and 160,000 new regular employment positions will be created.

There are issues with the unemployment rate where it could be understated due to reasons such as discouraged worker, part-time employment or underemployment.
Government could help out with 4 measures.
1. Unemployment benefits.
2. Employment incentives.
3. Job creation (already implemented)
4. Improving employability.

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German economic forecasts plunge as global industrial recession fears mount

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Germany's leading economic research institutes have sharply downgraded their forecasts for Europe's largest economy.

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Germany’s GDP (gross domestic product) rate exceeded the -0.1% contraction.  (Low GDP growth)
On an annual basis, the economy grew by 0.5% from July to September, Second-quarter growth was revised down from -0.1% to -0.2% and two consecutive periods of negative growth would have constituted an official recession. This shows us that as the real GDP of the current year is less than that of the previous year,  the growth rate will be negative when this happens it is known as a recession. ' while the numbers show the country avoided a technical recession in the third quarter, economic development in the region is still fragile.' This shows us that although there is a slight decrease in GDP from 0.1% to -0.1% as this decrease was minimal it was not considered a recession.

This was calculated by measuring the change in Real GDP compared with the previous quarter in the same year.

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Germany has narrowly avoided a technical recession, after the latest figures showed the country's economy grew by 0.1% in the third quarter.

Germany's GDP (gross domestic product) rate exceeded the -0.1% contraction expected by analysts. On an annual basis, the economy grew by 0.5% from July to September, the Federal Statistics Office reported. Second-quarter growth was revised down from -0.1% to -0.2% and two consecutive periods of negative growth would have constituted an official recession.

"No recession, but most definitely a very weak economy," Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics, said in a research note.

"In some sense, this is the 'worst' of both worlds for markets. Today's data confirm that the German economy has now stalled, but the headlines are probably not dire enough to prompt an immediate and aggressive fiscal response from Berlin."

Meanwhile, the German Economy Minister Peter Altmaier said that while the numbers show the country avoided a technical recession in the third quarter, economic development in the region is still fragile.

Speaking to CNBC's Annette Weisbach Thursday, Daniela Schwarzer, director of the German Council on Foreign Relations, noted there was "only a minor difference" between 0.1% and -0.1% growth.

"The truth of the matter is that Germany doesn't have a robust growth perspective at the moment," she said, noting that the export-dependent country was being hit by a shift in international trade policies.

"The whole question is what will the sources of future growth be for Germany, and the challenge to actually structurally change the German economy is huge ... There needs to be a strong investment in education, research and innovation, and Germany needs infrastructure investment as well."

Last month, Germany's leading economic research institute sharply downgraded its forecasts for Europe's largest economy. The Ifo Institute's joint economic forecast for the whole of 2019, published early October, was revised down from the 0.8% GDP rate projected in the spring, to just 0.5%.

The reasons for the poor performance, according to the institute, included falling worldwide demand for capital goods, which has hit Germany's export-reliant economy, along with political uncertainty and structural changes in the automotive industry.

- CNBC's Elliot Smith and Chloe Taylor contributed to this report.

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Germany narrowly avoids a technical recession with 0.1% growth in the third quarter

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Germany has narrowly avoided a technical recession, after the latest figures showed the country's economy grew by 0.1% in the third quarter. Germany's GDP (gross domestic product) rate exceeded the -0.1% contraction expected by analysts. On an annual basis, the economy grew by 0.5% from July to September, the Federal Statistics Office reported.

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Weaker global demand for manufacturing goods -> could be due to Trump's war on trade. Caused countries to impose levy tariffs on almost all major trading partners.
Although trade war is between China and US, this war affects all partners in NAFTA partners, affecting the global economy. Germany will be affected as she is Europe's industrial powerhouse and biggest economy. This includes big companies like Volkswagen (in the automotive industry) which could potentially enter into a recession due to falling orders and production. This caused bankruptcies in manufacturing companies in Germany as there is little to no purchase from other countries (net exports) to improve the wealth of the nation (GDP). -> Bankruptcies in companies = unemployment rate increases.  Therefore,  consumer confidence across developed economies is falling.  If there happens to be recession, government has to implement policies to enable the economy to recover from it and the speed of recovery depends on the effectiveness of the policies
implemented as well as the circumstances of the country (confidence of the people!)

Problem associated with Germany's trade revenue and GDP.
Germany relies on her trade (net) exports in the manufacturing industry. This is especially dangerous for Germany as almost half of the nation's GDP is based on its exports. When recession occurs, main trading partners will be less inclined to do business, export demand decreases, production levels decreases and this causes the loss of income. -> Causes Real GDP to fall.

This is also known as Cyclical Unemployment. (When real GDP falls, companies close down and jobs disappear).

Government
Ms Merkel’s Christian Democrats is calling to increase job creation. (spending on infrastructure, cutting tax)

Policies government SHOULD implement to help:
1. Unemployment benefits
Especially for manufacturing workers who could've lost their jobs due to the weak economy.
2. Employment incentives
Giving individuals incentives to work and giving firms more incentives to hire workers. (Low exports meant that companies wouldn't earn enough to hire as many workers as before therefore they had to retrench workers.)
3. Improving employability
Providing workers to upgrade skills OR acquire new skills to join other sectors of industry.