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ECONOMY

Walking off the crisis

Lean times have come to Germany. But Roger Boyes, the Berlin correspondent of British daily The Times, believes that doesn’t mean the country has to go all flabby.

Walking off the crisis
Photo. DPA

The most painful things about recessions, for those of us who still have jobs, are the forced choices.

What do you hang on to, what do you discard? It is as if your life has become a giant house clear-out.

Newspaper subscriptions? Out. Listening to the radio in the bath? In.

Weekday “business lunch” with some SPD functionary? Out. Pudding pretzel at the baker in the morning? In.

Cinema? Out. DVDs? In. Steak? Out. Mincemeat? In.

Now here comes the tricky one, a call from the gym reminding me that it is time to renew my membership.

In or out? This is of course not just a recession-related question. I have been feeling like an alien in the gym for some time, as if I have strayed by mistake into an Amazonian village, but I have clung on to membership out of the usual anthropological reasons.

Why do Germans feel that it is a basic, almost constitutional human right to stretch their muscles and then march about naked in the changing rooms? They make it seem like a national duty. But of course times have changed a little: there is no such thing as responsibility to the German nation anymore, only to one’s individual well-being.

That is why, during the good years (as we now have to consider 2005-8), gym membership ballooned in Berlin and throughout Germany. As did the number of Thai, Chinese and Aryuveda massage joints. Anyone with a Wellness Centre business plan could pick up a loan. A better body was somehow linked to the potential for ever-higher earnings.

So, my instinct is to say no thanks to the gym. Human muscles are vaguely interesting but not half as interesting as human brains. In bad times – you ask any bear – it is better to accumulate fat and hibernate. The challenge of an economic crisis is not to build up your abs and pecs and your body mass (just think how much more you have to eat to sustain that) but rather to relax tense muscle.

Doctors report a rapid increase of patients with headaches and migraines that stem from scrunched up necks and shoulders, often a direct result of conversations with one’s tax adviser.

Conclusion: use the cash saved by cancelling gym membership to pay for massages, forget the collapse of capitalism for an hour and stop sweating on the treadmill.

This is not, admittedly, a perfect solution. I visited a (respectable) Thai massage parlour on Berlin’s Kantstrasse last week and found the team more interested in a YouTube report on the widespread Bangkok unrest than in my frozen shoulder. The masseuse was angry presumably because her side was losing in the revolution.

“Must be good to have a revolution where everyone wears either a red or a yellow shirt,” I said, trying to look on the bright side of things, “a bit like a football match with tanks.”

“More complicated,” said Som in her evening-school German. She pressed hard on the shoulder blade and I squawked. “You very verspannt,” she said.

But it could have been worse. I could have been on the table of Dr Dot. Her real name is Dorothy Stein but she had been called Dr Dot ever since she sorted out Frank Zappa’s back. Since then she has become the big celebrity masseuse – her clients include Sting, Mariah Carrey, Lauryn Hill and Bruce Willis – and whenever a rock group performs in Berlin they come to her for treatment.

She has a global following but of course almost nobody knows here in Berlin; the charm of the city is its sheer inability to recognise international stars unless they are spotted coming out of Borchardt’s restaurant.

Brad Pitt and Angelina Jolie thought the fact that they could walk down the street like normal people was a sign that Berliners were cool, insouciant. In fact, Berliners are simply short-sighted. As a result Dr Dot – though she writes a very energetic sex column for the excellent English-language magazine ExBerliner – lives in the city almost anonymously until one of the Rolling Stones hurts one of his ageing joints.

But massage is no more an escape from the global mess crushing the German economy than working out at Holmes Place surrounded by increasingly nervous managers grunting as they lift 10 kilo weights.

Here then is my solution: cancel your gym membership, forget the massage table, and go for a walk in Berlin’s Grunewald park. If you spot me in the forest, identify yourself and I will buy you a beer. It’s better for your health and better for the German economy.

For more Roger Boyes, check out his website here.

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ECONOMY

How is Denmark’s economy handling inflation and rate rises?

Denmark's economy is now expected to avoid a recession in the coming years, with fewer people losing their jobs than expected, despite high levels of inflation and rising interest rates, The Danish Economic Council has said in a new report.

How is Denmark's economy handling inflation and rate rises?

The council, led by four university economics professors commonly referred to as “the wise men” or vismænd in Denmark, gave a much rosier picture of Denmark’s economy in its spring report, published on Tuesday, than it did in its autumn report last year. 

“We, like many others, are surprised by how employment continues to rise despite inflation and higher interest rates,” the chair or ‘chief wise man’,  Carl-Johan Dalgaard, said in a press release.

“A significant drop in energy prices and a very positive development in exports mean that things have gone better than feared, and as it looks now, the slowdown will therefore be more subdued than we estimated in the autumn.”

In the English summary of its report, the council noted that in the autumn, market expectations were that energy prices would remain at a high level, with “a real concern for energy supply shortages in the winter of 2022/23”.

That the slowdown has been more subdued, it continued was largely due to a significant drop in energy prices compared to the levels seen in late summer 2022, and compared to the market expectations for 2023.  

The council now expects Denmark’s GDP growth to slow to 1 percent in 2023 rather than for the economy to shrink by 0.2 percent, as it predicted in the autumn. 

In 2024, it expects the growth rate to remain the same as in 2003, with another year of 1 percent GDP growth. In its autumn report it expected weaker growth of 0.6 percent in 2024.

What is the outlook for employment? 

In the autumn, the expert group estimated that employment in Denmark would decrease by 100,000 people towards the end of the 2023, with employment in 2024  about 1 percent below the estimated structural level. 

Now, instead, it expects employment will fall by just 50,000 people by 2025.

What does the expert group’s outlook mean for interest rates and government spending? 

Denmark’s finance minister Nikolai Wammen came in for some gentle criticism, with the experts judging that “the 2023 Finance Act, which was adopted in May, should have been tighter”.  The current government’s fiscal policy, it concludes “has not contributed to countering domestic inflationary pressures”. 

The experts expect inflation to stay above 2 percent in 2023 and 2024 and not to fall below 2 percent until 2025. 

If the government decides to follow the council’s advice, the budget in 2024 will have to be at least as tight, if not tighter than that of 2023. 

“Fiscal policy in 2024 should not contribute to increasing demand pressure, rather the opposite,” they write. 

The council also questioned the evidence justifying abolishing the Great Prayer Day holiday, which Denmark’s government has claimed will permanently increase the labour supply by 8,500 full time workers. 

“The council assumes that the abolition of Great Prayer Day will have a short-term positive effect on the labour supply, while there is no evidence of a long-term effect.” 

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