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The Chinese Disease.(International Edition; RECESSION)(trade protectionism)(Brief article)

Newsweek International

| March 16, 2009 | Theil, Stefan | COPYRIGHT 2009 Newsweek, Inc. All rights reserved. Any reuse, distribution or alteration without express written permission of Newsweek is prohibited. For permission: www.newsweek.com. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

Byline: Stefan Theil

If Americans are in shock over the economic plight that the collapse of the housing bubble has wrought, Germans are simply baffled. In their view, they seem to have done everything right--they have a high savings rate, a solid manufacturing base and no exuberance in their real-estate market, while profligate Americans binge-spent their way to illusory growth. Yet the crisis has hit Germany much harder than America--its GDP shrunk 2.1 percent in the fourth quarter of 2008, compared to minus 1.6 percent in the U.S., and the 2009 forecast is grimmer-- minus 4 percent in Germany versus 2 percent in the U.S.

The problem is that Germany is actually a lot like China. Its own conservative position as an ...

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