Germany IS About To Have Its Worst Recession Since WWII

The German economy is about to suffer its deepest recession since World War II according to economics Minister Michael Glos speaking in an interview with the German newspaper Welt am Sonntag due to be published tomorrow (Sunday). Glos said growth in Europe's largest economy is now expected to drop by as much as 2.5 percent this year (and there is still downside risk here). Earlier government estimates had been for slight positive growth (0.2 percent). This suggests that the miracle export-driven-recovery in German economic performance that so many were enthusing about in 2007 has actually been a short lived, one-off, affair, driven largely by an unsustainable lending boom in the UK, and Southern and Eastern Europe. If we take as good this year's government estimate, it gives us average growth for the German economy over the last 10 years of 1.07%, hardly changed from the supposedly "correctional" pace attained between 1995 and 2005 (see chart below) - or is Germany's lost decade now surreptitiously going to convert itself (like its Japanese equivalent) into the lost decade and a half?