A German friend stated to me over lunch last week that, and i quote.

In News by redsocks

“A fall in house prices would not adversely affect Germany’s economy”?  

Sorry? What?  After scraping myself back onto my seat in Novikov’s superb restaurant with tears rolling down my pretty olive-skinned cheeks. We had a hilarious and very heated debate.

These are the facts.

  1. On the most recent measures, Spain’s property market is up 200 per cent (from 100 to 300) and Germany’s by 50 per cent (to 150). So Germany is way behind the curve.
  2. Germany’s property market is artificially inflated, by at least 25%. Forget 10%-15%. Try 25%.
  3. The Bundesbank is indeed becoming concerned about the frothiness of the market. From its latest Financial Stability Report. Why?
  4. Germany has a monster whaling in pain, desperately trying to stay alive. Its name is Deutscher Bank. The new darling of the American REPO Market by the way. If Deutscher Bank is not the secret American REPO Market bailout. I will come to work in my boxer shorts for a week. (You’re not fooling anyone Deutscher Bank).


The German economy is not good

Stay away from all things German Real Estate Investment right now.

If Deutscher Bank fails there will be turmoil. I’m Vaterland.