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Is it Germany's hope that they will retain the qualified jobs while reducing the rest of Europe to waiter status?

Jacques,

25 years ago we had this eurosclerosis scare, that Europe becomes a Disneyland for American and Japanese Tourists.

France is a highly industrialized country with some quirks.

But then compare the following ETFs (EWG is Germany)
http://finance.yahoo.com/q/bc?t=my&s=EWQ&l=on&z=l&q=l&c=ewg&ql=1
PE ratios are 12

Compare FDI in and Outflows http://www.oecd.org/daf/inv/FDI%20in%20figures.pdf
Now does this look like investors are scared of France ?

Europe and Asia is somehow made a connection to help each other continent in terms of tourism and economy. This will be broken.

genauer: of course I know that contrary to american mythology France doen't scare off investors while it has that rare combination of high-tech and high-paying low-tech. After all, France has been living off tourists coming to see their state-of-the-engineering-art cathedrals since the Middle Ages. Just that I had not heard from my esteemed friend for some time and I knew you would bring some very useful info with your reply...
Have a nice week-end.

hix is stuck in spam.

I notice an increasing number of tourist buses in Ottawa too. My guess is that the future will bring more individual/family tourists, rather than just tour groups.

Maybe some of them drop in Croatia too :D

@ Jacques,

LOL, gotcha, your trick worked!

I became aware, that I was commenting too much, and tried to restrain myself : - )

Just for a short side story, The heavily armed Russian occupiers left just 20 years ago, and I want to say on very generous terms, we would have paid a lot more. I think they made strategically the right decisions, just as our allies in 1953 with the London Debt agreement, because today the Russians are very welcome as neighbors and maybe even friends.

Something I wrote recently in a different blog:
“I am a West German, now living in Dresden. We don’t have any problems with the Russians, we do know history. We love our Russian visitors; they have fat wallets and open them freely in exchange for the wares we offer them. We have the menus in Cyrillic, and Putin is welcome at his old workplace as a KGB officer : - ) He speaks German very well, gives German speeches to the Sovereign, the Bundestag, and Merkel and my prime minister Stanislaw speak Russian very well. My former gay foreign minister was pissed a little bit, when they talked in Russian and he didn’t understand a word : - )”

They are welcome as long as they don’t come in large numbers, in lockstep and uniform and armed.

You gain and keep happy customers, when you value them, tend to them (we have 24 city employees specifically for Russian visitors, and wait on them . Without losing any dignity with that.

The Russian actually seem to enjoy some Germans in uniform and lockstep:
http://www.youtube.com/watch?v=C0IYnRQJas0
the “precision” part comes mostly after 2:30

The father of the Berlin Mayor Reuters was actually prime minister of a Soviet republic.

The Japanese version is:
http://www.youtube.com/watch?v=nlwnOMB2oWA


Nick: tourism is the ultimate way of consuming high productivity while avoiding declining marginal utility ( there are so many places to visit...). Remind me of a passage in "Brave New World" where some alpha higher-up explains to his students :"Some years ago, we trained deltas and epsilons to love nature. The goal was to consume excess transport." ( not the exact wording,quoting from memory).

genauer: indeed , great powers behaviour after WWII up to now had been remarkable.Debt forgiveness and Marshall Plan. In fact,even Soviet behavior after 1945, even under Stalin, was remarquably less horrendous than it could have been, given the abomination that were the 20's and 30's. The restraint shown during the Cuban crisis ( compared to let's say 1914) and so on. And one thing that help maintain this sanity may be tourism. It is increasingly difficult to demonize people you see regularly.
I should divert myself from some of mysecret anglophilia and visit Germany. Any good aviation museum to recommend?

Stuck in spam!

An add-on: in my view, the most peace-producive measures are the Erasmus program, the civil service exhange program (France and Germany, maybe some others?) the NATO offficer exchange program and the multinational military units (French-German,Polish-German, Dutch-Belgian, French-Belgian, French-Spanish-Italian). Till Cameron-Osborne destroyed the Royal Navy, France and Britain operated their aircraft carriers in an almost integrated way.

Now let us give this Figaro article, and its content, a good, German style, trash talk:

1. I look at the original, of a supposedly conservative, employer friendly newspaper “Le Figaro”. It is behind a pay wall, I don’t see a way to look at this one article, just buy some abonnement and I don’t see any foreign language offer.
Does this look like friendly to foreigners, potential new customers?

2. Let us have first have a look at wiki World_Tourism_rankings

a) Number of visitors

France ranks #1 in “International tourist arrivals”, impressive, but the growth is only 3.0%, behind any volume competitor, but weirdoes Mexico and Malaysia.

b) Net gain

Now look at the economic impact: “International tourism receipts 2011” 53.8 b$ MINUS “International tourism expenditure 2011” 41.7 b$, makes a net of 12.1 b$, or
Gigantic 0.47% of a GDP
Of 2.58 t$ (CIA World Fact book)

c) Visitors

1.1 million Chinese, out of 79.5 m visitors to France, this is just 1.4% (same as above!), times 0.47% = 65 parts per million, truly a mycro-scopic effect.
That they buy 10% of the stuff in the duty-free shops at the airports, mostly produced by themselves (China), and sold by employees of various global airlines, what good does this to the French tax coffers or French incomes?

Raising 0.0065% by relative 15% growth per anno will surely make a dent in a 3.5% budget deficit.

d) Expenditure per visitor

(just calculated from the wiki, every 8th grader should be able to do this, why not Le Figaro)

k$/visitor Country
1.87 US
1.06 Spain
0.68 France
0.84 China
0.93 Italy
1.37 Germany
1.23 UK
0.94 Australia

France comes in so dead last, it is embarrassing. You make money by luring the visitors into the countryside, see the real culture, like the Ch'tis, and spend their money in the land, and not in the duty free shops.

I don’t think it is necessary that some impersonator of the Prime and finance minister dance a kasatschok, like in Bavaria http://www.youtube.com/watch?v=kfq1k0iD8Jo

But hey, it would be a start : - )

3. additional comments

Canada seems to be as good at spending abroad as Germany, per capita : - )

All those (esp. German) hypocrites, who languish in (pseudo) despair over those irresponsible southern countries, I tell, it took Germany also quite a few years, after huge tax increases, counter acting tax avoidance movements (Scheinselbstständige), huge energy tax increase, to finally accept, 2003, that we had to cut on social goodies.

The link for Putin in the Bundestag: http://www.youtube.com/watch?v=aYtEmYeSga4
30 minutes fluent, accent free, rich with very valuable content

I tried to post this before, got confirmation, but got stuck:

Now let us give this Figaro article, and its content, a good, German style, trash talk:

1. I look at the original, of a supposedly conservative, employer friendly newspaper “Le Figaro”. It is behind a pay wall, I don’t see a way to look at this one article, just buy some abonnement and I don’t see any foreign language offer.
Does this look like friendly to foreigners, potential new customers?

2. Let us have first have a look at wiki World_Tourism_rankings

a) Number of visitors

France ranks #1 in “International tourist arrivals”, impressive, but the growth is only 3.0%, behind any volume competitor, but weirdoes Mexico and Malaysia.

b) Net gain

Now look at the economic impact: “International tourism receipts 2011” 53.8 b$ MINUS “International tourism expenditure 2011” 41.7 b$, makes a net of 12.1 b$, or
Gigantic 0.47% of a GDP
Of 2.58 t$ (CIA World Fact book)

c) Visitors

1.1 million Chinese, out of 79.5 m visitors to France, this is just 1.4% (same as above!), times 0.47% = 65 parts per million, truly a mycro-scopic effect.
That they buy 10% of the stuff in the duty-free shops at the airports, mostly produced by themselves (China), and sold by employees of various global airlines, what good does this to the French tax coffers or French incomes?
Raising 0.0065% by relative 15% growth per anno will surely make a dent in a 3.5% budget deficit.

d) Expenditure per visitor

(just calculated from the wiki, every 8th grader should be able to do this, why not Le Figaro)

k$/visitor Country
1.87 US
1.06 Spain
0.68 France
0.84 China
0.93 Italy
1.37 Germany
1.23 UK
0.94 Australia

France comes in so dead last, it is embarrassing. You make money by luring the visitors into the countryside, see the real culture, like the Ch'tis, and spend their money in the land, and not in the duty free shops.

I don’t think it is necessary that some impersonator of the Prime and finance minister dance a kasatschok, like in Bavaria http://www.youtube.com/watch?v=kfq1k0iD8Jo
But hey, it would be a start : - )

e) additional comments

Canada seems to be as good at spending abroad as Germany, per capita : - )
All those (esp. German) hypocrites, who languish in (pseudo) despair over those irresponsible southern countries, I tell, it took Germany also quite a few years, after huge tax increases, counter acting tax avoidance movements (Scheinselbstständige), huge energy tax increase, to finally accept, 2003, that we had to cut on social goodies.

2nd time stuck in spam

Now let us give this Figaro article, and its content, a good, German style, trash talk:

1. I look at the original, of a supposedly conservative, employer friendly newspaper “Le Figaro”. It is behind a pay wall, I don’t see a way to look at this one article, just buy some abonnement and I don’t see any foreign language offer.
Does this look like friendly to foreigners, potential new customers?

2. Let us have first have a look at wiki World_Tourism_rankings

a) Number of visitors
France ranks #1 in “International tourist arrivals”, impressive, but the growth is only 3.0%, behind any volume competitor, but weirdoes Mexico and Malaysia.

b) Net gain
Now look at the economic impact: “International tourism receipts 2011” 53.8 b$ MINUS “International tourism expenditure 2011” 41.7 b$, makes a net of 12.1 b$, or
Gigantic 0.47% of a GDP
Of 2.58 t$ (CIA World Fact book)

c) Visitors

1.1 million Chinese, out of 79.5 m visitors to France, this is just 1.4% (same as above!), times 0.47% = 65 parts per million, truly a mycro-scopic effect.
That they buy 10% of the stuff in the duty-free shops at the airports, mostly produced by themselves (China), and sold by employees of various global airlines, what good does this to the French tax coffers or French incomes?
Raising 0.0065% by relative 15% growth per anno will surely make a dent in a 3.5% budget deficit.

d) Expenditure per visitor
(just calculated from the wiki, every 8th grader should be able to do this, why not Le Figaro)
k$/visitor Country
1.87 US
1.06 Spain
0.68 France
0.84 China
0.93 Italy
1.37 Germany
1.23 UK
0.94 Australia

France comes in so dead last, it is embarrassing. You make money by luring the visitors into the countryside, see the real culture, like the Ch'tis, and spend their money in the land, and not in the duty free shops.

e) additional comments
Canada seems to be as good at spending abroad as Germany, per capita : - )

All those (esp. German) hypocrites, who languish in (pseudo) despair over those irresponsible southern countries, I tell, it took Germany also quite a few years, after huge tax increases, counter acting tax avoidance movements (Scheinselbstständige), huge energy tax increase, to finally accept, 2003, that we had to cut on social goodies.

Genauer & Shangwen:
Went into the comments and I think you are both out of spam. Will check again later. Appreciate the calculations Genauer. What I also find interesting is that Paris is just packed with tourists from all over Europe as well as China with a large number of tourists from Spain and Italy in France - as well as the parts of Germany that I went into last week. My observations are anecdotal but Europe does not seem economically depressed.

Livio,

Germany, and most countries of the North, are running on all 5 cylinders. Unemployment is at quarter century lows. If we would be alone in the world, interest rates would be at 4 - 5%, the Euro at 1.4 - 1.5 to the Dollar(with a "fair value" at about 1.25).

The South has significant structural problems, but they are so far unwilling to really address them. But that does not mean that the upper 20%, who travel the most, have any problems, so far. They just expect that somehow it is the taxpayers of other countries, who should solve their national problems, somehow, especially with ultra low interest rates and some kind of wealth transfers through the back door (debt mutualization, banking union, or downright transfer union)

Please read a little bit in ecb.int/pub/pdf/other/ecbsp2en.pdf a recent official european wealth examination.

Many people, who travel, get some tourism bias, the prices you see are higher than country average, you only see the (touristic) centers, and only the visible outside.

As long as you do not systematically counteract that by putting down numbers, you have harldy a chance to avoid it.

I have heard those "country expertise" of supposed experts of McKinsey ("immersed for years", in some expat communities) and the likes, basically just regurgitating the usual stereotypes, in powerpoint.

@ Jacques

I don’t think that France ever made substantial fractions of GDP (like > 5%) of foreign tourism. Spain and Italy possibly, especially from the UK and Germany, LOL, the famous towel wars.

But that was at times, when their GDP per capita, wages were at just a 3rd or half of ours, at least in the tourist regions.

Germany had a substantial trade surplus since 1953, and besides paying off some war debt, we spent all of it on tourism, the few richer ones on got a second home in the sun. And our accumulated net international position was ZERO in 1998. And that is, what it should be in the long run. The accumulation of the last few years is just some aberration.

Nowadays the formerly dramatic delta between our trade surplus and the current account is near zero. The tables at http://www.economist.com/markets-data , especially „ Trade, exchange rates, budget balances and interest rates”, and “Output, prices and jobs” are pretty interesting, if you follow them for a few years, and with some systematic followup.

(Naaah, I just can’t withstand, their famous misreporting of Venezuela interest rates, for years, after substantial mocking, is now replaced by a “N.a.”, I can buy this stuff, locally, in Germany, this rate is available in the market, but somebody at their EIU has some special ax to grind : - )

This Figaro article is just a typical example, that people tend to focus on a few bright small spots, and completely miss the bigger picture, how large is this sector really, net. How do growth rates stack up against the competition. 5% Growth rate sound nice, until you compare it to some 10% market growth.

And it seems pretty much, that a lot of this tourism focuses on some fly-over just into Paris, and does not arrive in the country side. Like the US doing well in the blue seaboard states, and much less so in the red heartland states, considerably simplified, of course.

The only aviation museum in Germany , I am aware of , is http://www.deutsches-museum.de/en/flugwerft/information/ but I have to admit, I haven’t been there, although I lived for 10 years in Munich. I also have not been to any Bayern München game, and at the Octoberfest only with visitors.

If I'm remembering correctly, Europe has a current account deficit with China. Doesn't tourism help the current account deficit?

@ TMF

Chinese Tourism is a "statistically significant", positive ZERO, as in < 0.1% GDP, net.

A classic case of the McCloskey critique, established economics as a "cargo cult", with that term popularized by the revered Richard P. Feynman : - )

I sympathized with you not going to the Oktoberfest. It's been a good 15 years since I went to the Quebec Winter Carnival. I don't sense missing anything...

Hello Genauer:
Good point about the tourism bias when travelling. However, spent a fair amount of time in Germany and can say that it looked more prosperous than Paris. As well, Strasbourg had alot of construction activity but it has a unique economy given it is the European capital. A bientot!

Livio,

since I didn't know that Strasbourg is the capital of Europe,
I looked up wiki/European_institutions_in_Strasbourg,
and laughed about "Strasbourg ? Perfect, no one will go there."

That the ENA moved there, is pretty interesting. Size less than a million, public transport by tramway, kinda like Dresden.

My hair cutter this week was the 4th person to tell me, that public transport in Munich is much better, this time it was "cheaper", when she compares the price their 10 years ago, with the price here today .. :- )

Others claimed denser network, I dont think so. Higher frequency, but only during the day, when it is pretty crammed, and on the main lines.

But I did check, whether it could be me, with some bias, given my special locations in Munich and Dresden : - )

Seems some inverse tourism bias at work, like the grass is greener somewhere else.

@Jacques

In the late 70ties to 80ties it was very popular here to have "sister cities" all around the EU. Dresden is actually that to Strasbourg! Delegations, exchanging teachers , ... Our 2nd deputy mayor, a french teacher, in the small western German town I was born, was very active, in many ways. At some point people bitched, that we will get the next partner city, where ever he gets the next foreign young colleague preggers : - )

His wife was, as my mom, part of the Schwimmbad Mafia, a small cartel of public opinion shapers in that small town : -) Busy with their own global, UNESCO based, cultural exchanges.

Today we focus more on the practical aspects in the border regions.
Grenzüberschreitende_Zusammenarbeit
http://www.interreg.de/cln_032/nn_457906/INTERREG/DE/Programm/InterregA/interrega__node.html?__nnn=true
(There is an „english button“ at the top right)

Do you remember those US (road) movies from the 70ties, "Cannonball", when the county police had to stop the chase at the county borders?

Today (Schengen treaty) we have removed all border controls but have intensive practical interaction, German police can go some 20 km into Czech and vice versa, optimizing medical rescue centers, sewer systems … : -) Cutting costs and improving public service quality.

Jacques, aviation museums in Germany...

Deutsches Museum in Munich is definitely worth spending at least a day in. They have some artifacts there that I've seen nowhere else:
- a Hansajet
- Messerschmitt rocket plane/glider
- BMW (IIRC) turbojet from WW2. Oldest aviation gas turbine I've ever seen.
- in addition to aviation stuff, a whole lot of other wonderful things too (in the civil engineering section I learned about bridge bearings, and they have a really great electrical machines section. And a really great display outdoors of several different water turbine designs all of similar size but with power densities differing by several orders of magnitude)
- if you like beer and you are visiting Munich you should go to Augustiner am Platzl, who make the best Helles I have ever had

There is also a very small but quite nice little aviation museum in Altenburg. If you're in the UK you can get an el-cheapo once a day Ryanair flight there from Stansted. The airport in Altenburg is a Cold War era fighter base, with individual aircraft shelters spread along the runway and around the airfield (first time I've seen this kind of airfield). The aviation museum has a small number of Soviet and Western aircraft, some avionics, and a few smallarms and aircraft cannon. There's also a company at the Altenburg airport that makes small diesel aero engines, which might be an interesting related place to tour while you're there.

geauer; thanks for the museum info.
I remember seeing an article in the NYT about the Czech and German villages sharing service. What made it somewhat poignant was that , at the same time, there was a similar situation in SW Québec- NE New York, with the QC town providing fire protection for the U.S. village. Then,one night, a call came in and the firemen rushed toward the border. Instead of being waved through by their friends, they found that a new crew was there . They were blocked: they were asked for work permit and their truck had to be inspected , for security reasons. Meanwhile, the house burned down. The EU experiment, despite its flaws, is the noblest political experiment in a very long time. May it succeed...

The new Pew research was just released from embargo.

This time with Poland and Czech

http://www.spiegel.de/media/0,4906,31415,00.pdf

The huge majority in France in favor of reducing government spending is interesting.

Germany is the last to support more integration

Merkel is still more popular than their own leader, except in Greece

Everybody thinks he is the most compassionate

Hi Genauer: Am back home. Good point about tourist bias influencing observations. To add to that further - Germany seemed more prosperous than France and within France, Strasbourg seemed more prosperous than Paris. Basing that on German towns of Koblenze, Heidelberg & Mannheim. Alot of construction activity in Strasbourg.

The strasbourg thing surprises me somewhat, but I was the last time there 20 years ago,
and when you look at house prices and other parameters, quite a number of US area are also off sync.

But construction activity in (west) Germany was also pretty low for some time, so a little catch up seems to be appropriate now.

I think one observation into that direction was triggered by Frances Wooley's milk packages thread, which then let to milk prices, prices in general, and at some point I took a list from numbeo.com and put down local numbers, which actually only took some 20 minutes, but the open question were "restaurant meal", and I then plotted some standard meal "SchiPoSa" viennese Schnitzel with Pommes Frites and Green Salad locally, on my way back, may be some 5 minutes spend extra , vs distance to the (tourist) center, and ended with just 60% of ground zero, over 1.5 km, in a still very popular quarter, I live in : - ) Robust, not just taking 2 outliers. That was significantly more than I thought before.

I try to do this now more often, to think about potential influence factors, and to really put 5 or 6 numbers down, in writing, to control myself for potential bias.
That produced some surprises.

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