Morning Briefing

U.S. Intelligence Calling

Not only the U.S. president but his intelligence services have a direct line to the German chancellery. American officials warned the German government about letting China’s Fujian Grand Chip Investment acquire Aixtron, a maker of  semiconductor equipment near Aachen. Washington is concerned Beijing could use the sophisticated technology for its nuclear program. Representatives from Angela Merkel’s office, and the economics, interior and defense ministries,  reviewed the evidence at the U.S. embassy in Berlin, according to our sources.

Vice Chancellor Sigmar Gabriel, who is also economics minister, promptly reversed the German government’s decision to approve the deal. That turnaround comes days before his official visit to China, when he won’t be able to dodge questions from 60 top managers on his plane: Is China friend or foe? Should German businesses keeping trading or consider the political consequences?

Or should they go on a wartime footing? NATO yesterday agreed to station 4,000 troops in eastern Europe, its biggest military build-up since the Cold War. The deployment will no doubt provoke Russian President Vladimir Putin, who has thousands of troops on NATO’s doorstep. Secretary General Jens Stoltenberg said NATO allies are on the “right path,” but given Putin’s inferiority complex, this could lead to disaster. It seems the former Norwegian prime minister’s best trait is self-hypnosis. In this kind of world, all ways are the right way.

Two economists, two opinions: Prominent economic forecasters Marcel Fratzscher and Lars Feld are at loggerheads in a government commission that is investigating ways to boost investment. In emails, Feld said Fratzscher’s call for mega government spending would outdo “France as the birthplace of planification.” The commission, Feld added, “has lost its bearings” and deserves to be boycotted! For child psychologists, here’s an interesting case of late-onset puberty.

If you’re looking for job security, German midsize companies may be your best bet. Ifo Institute’s latest employment barometer shows Germany’s job machine roaring ahead on its “Mittelstand” layer of klein-but-fine small businesses. Last year, big businesses and the public sector axed 180,000 jobs, but midsized companies added 460,000. Some of their best would certainly deserve a federal service medal, if the German president had any left over to give out.

Deutsche Bank’s share price has plummeted nearly 40 percent this year. Analysts expect the bank to post a €1.4 billion loss in 2016. After doling out €2.4 billion in bonuses last year, Deutsche is considering cutting bonuses this year. Only considering? The London investment team has seriously damaged the bank’s reputation, balance sheet and prospects. In all fairness, these highly rewarded employees should repay bonuses earned under false pretenses during the years of excess. Someone needs to pull the plug on the London champagne party. And let the fat cats dry out.

Wishing you a sober but bracing start to the day. Yours sincerely,

 

Picture of the Day

10-27
Murals have been appearing regularly across Glasgow since 2008, revitalizing tired corners of the city. Now a new Mural Trail has been devised within a short walking distance from the city center. Source: Getty Images
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