Report
Patrick Artus

What can be done to make Germany invest more in the other euro-zone countries?

Since the euro-zone crisis (2010-2013) Germany has not lent its excess savings to the other euro-zone countries, but to the rest of the world. This has prevented a significant increase in investment in the euro-zone countries other than Germany. We therefore seek to determine what can be done to make Germany invest its excess savings in the other euro-zone countries. Th ese following conditions would have to be met : The return on capital would have to be high in these countries; Banks' balance sheets would have to be cleaned for low-quality assets, so that German interbank lending to other countries could start again; Governments’ fiscal solvency would have to be good, to restore lending by German banks and investors to other euro-zone governments, and also to banks (given the correlation between sovereign risk and banking risk).
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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