Germany Headed For A Downgrade?

[Valin]

The Feed:

12/19/13

 

The eurozones most important economy could be in for a rude awakening. In the wake of Standard & Poors recent downgrade of the Netherlands, warn two Dutch economists, Germanys coveted triple-A credit rating is likely at risk. Germany is one of only two Eurozone countries left with the top rating (Finland is the other), but with its slowing output, aging population, expensive pledges to save the euro, and a new, untested governing coalition, the problems that brought down the Netherlands down may eventually afflict the economy holding Europe together:

 

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Germanys new coalition of Christian Democrats and Social Democrats faces a big challenge ahead. The initial forecast is somewhat cloudy: to cement her coalition, Angela Merkel agreed to lower the retirement age for some German workers and contribute more money to public pensions. A national minimum wage is also set to be introduced. Lets hope Germanys governing class isnt beginning a long-term trend of sacrificing economic strength to score political points. Productivity, growth and job creation are guaranteed to no one.