InformationWeek:

London may be eclipsing Wall Street as the world financial capital, and the euro is trouncing the dollar, but Europe has yet to prove the equal of the United States in technological innovation.

Author and engineer Hervé Lebret thinks he knows why. "There is a risk culture that's missing. We don't have an environment to be more ambitious and risk-taking." His book, Start-Up: What We Can Learn from Silicon Valley, argues that Europeans need to recognize the value of risk -- and failure. "In the U.S. it's not that people like failure, but it's seen as a way to learn," he says. "In Europe, if you fail you aren't given a second chance to try again. So it's viewed very differently."

Sounds familar. See "Germany's Innovation Dilemma" on Atlantic Community.

Deutsche Bank got a lot of negative press coverage in the United States. David Vickrey, who used to work on corporate finance transactions at Deutsche Bank Securiites and Barclays Capital, has written extensively in his blog Dialog International about the involvement of German banks in the US mortgage crisis. Here are a couple of posts in chronological order (latest on top):

Karma and Bad Times for Deutsche Bank in America (April 27, 2008)

Greed and Fear: US Subprime Crisis Takes Its Toll in Germany (April 9, 2008)

The Subprime Crisis Leads to Mad Mergers in Germany (April 1, 2008)

German Government: Please Sue Deutsche Bank (March 10, 2008)

Deutsche Bank: America's Foreclosure King (January 24, 2008)

German Bundesbankers expect a gradual slowdown of the economy as a result of weaker global growth, higher oil prices and a stronger euro. They are not concerned about any direct fallout from the US mortgage crisis, writes Ralph Atkins in the Financial Times.

The article's headline is "Schadenfreude stirs in resilient Germany," but Atkins only claims once that "across Germany, a sense of schadenfreude has even started to emerge." His only indication is that "Peer Steinbrück, finance minister, has long maintained that a run on a bank, as seen with Northern Rock in the UK, would not happen in Germany." Well, many Germans are scared about their jobs and worry about poverty in their later retirement. Many are so concerned about the financial markets that they do not invest their savings, but keep them on a bank account with low interest, which is bad for retirement plans and for the economy. That's why the finance minister tries to reassure the public. That's not Schadenfreude. Perhaps the folks at the Financial Times felt compelled to use a German word in their headline. Next time write "Blitzkrieg" or "Kindergarten" or address people as "Herr Steinbrück" rather than "Mr. Steinbrück" (a weird habit of some).

Otherwise the article is good and describes what has been going on:

Germany's recent economic history has been the mirror image of the US's. Instead of enjoying a consumer and housing boom over the past decade, Germany has experienced a period of painful adjustment to the costs of reunification in the early 1990s and the effects of globalisation on a high-wage economy. By the time the global financial crisis struck, extensive private-sector restructuring had restored cost competitiveness, while consumers had retrenched financially - with house prices flat or even falling. The result was an economy driven not by consumer spending but by its powerful export motor, with industry producing high-quality goods that appear relatively insensitive to the higher exchange rate. 

Atkins ends with an FT typical conclusion:

But that is not the same as saying Germany has the better long-term prospects. Whereas the US's financial system and more flexible labour markets appear to booms and busts, Germany's economic growth rates traditionally remain steadier - but lower.

From the Wall Street Journal's Environmental Capital blog:

Europe's biofuel industry has long complained about U.S. subsidies. Friday, it took its case to the European Union but the chances of winning a victory look slim. EU biodiesel producers have been simmering about the $1 per gallon tax credit American biodiesel producers get. EU producers say that distorts the market and, in the words of the biodiesel trade group, created a severe injury to the EU biodiesel industry.

The Guardian is a bit more optimistic regarding the European Biodiesel Board's case.

Germany's economic recovery "resembles that in Dubya's USA: growth for the well-off, more (crap) jobs but less income for the rest," writes DoDo in the European Tribune and points to a just released study by the German Institute for Economic Research (DIW) that says that real income fell by 3.5%.

The Federal Foreign Office announced today:

Germany is stepping up its efforts to establish an international uranium-enrichment plant under the control of the International Atomic Energy Agency (IAEA). Today, at IAEA's headquarters in Vienna, Federal Government representatives informed interested States about the details of the German proposals to multilateralize the nuclear fuel cycle, receiving a highly positive response. This concept is based on an initiative by Federal Foreign Minister Steinmeier. More and more countries are thinking of starting their own enrichment activities. Any joint solution must therefore take the desire for the peaceful use of nuclear energy into account, while at the same time making sure no fuel is misused to build nuclear weapons.

Could this be a workable compromise for the conflict over Iran's nuclear program?

Reuters:

In the latest example that the U.S. dollar just ain't what it used to be, some shops in New York City have begun accepting euros and other foreign currency as payment for merchandise.

This comes after the Latest Indication of US Economic Troubles: Hip-Hopper Flashes Euro Notes.

Thus, Kevin Hassett, director of economic-policy studies at the American Enterprise Institute and an adviser to Senator McCain, considers it necessary to remind everyone: Ignore the Obituaries, U.S. Reign Will Endure, which is also response to Parag Khanna's essay in the NYT, discussed on Atlantic Review.

I think it is good that NYC shops open up to Euros, but most customers pay with credit card anyway these days. The Boston Globe claimed in November 2007: "With dollar low, US is one big outlet: Europeans arriving in droves for bargains."

Do you see an expression of Schadenfreude on my face? Nope. I am just reflecting on history: Before we had the Euro and before credit cards were popular in Europe, we would travel to other European, Asian or African cities and use plenty of exchange bureaus or banks to convert our national into the local currencies. But this was not possible when traveling to the United States, where it was extremely difficult to find a bank that would exchange Deutschmark into Dollars without several days waiting period and huge fees. The dollar was the only currency Americans knew and accepted. Every tourist had to get dollars before arrival. So we were carrying plenty of cash and traveler checks in dollars. Now the United States is becoming more international by opening-up to the Euro. Cool, but then again, everybody is paying with credit card these days, so it is not such a significant change now.

Related post in the Atlantic Review: Thanksgiving: More Americans Travel to Europe Despite the Weak Dollar

"With American goods already flooding Damascus, analysts say lifting restrictions will help counter Iran's influence," writes the Christian Science Monitor:

Provided that goods are not manufactured in the US or produced with more than 10 percent of American content, both increasingly the case with the globalization of production, American companies are not restricted from selling goods in Syria although the goods are not then classified as American. "Typically you have Ford cars inside the market. When they opened the showroom you had people from the US embassy attending. Ford cars are manufactured in Germany, not the US, so they are not banned from being exported here," says Syrian economist Jihad Yazigi.

Presidential candidate Mike Huckabee is right this time (via: Andrew Sullivan):

None of us would write a check to Osama bin Laden, slip it in a Hallmark card and send it off to him. But that's what we're doing every time we pull into a gas station.

The same is true for Europe, which is even more dependent on oil from the Middle East than the United States. Related posts in the Atlantic Review: The US-Saudi Relationship: Oil Supply at the Expense of US Security and Moral Values and Chicago Tribune: "Germany says 9/11 hijackers called Syria, Saudi Arabia"

SuperFrenchie presents the picture that says all about President Bush's latest Middle East tour. I am not aware of any European head of government having kissed Saudi princes. Bush does not just kiss the Saudis in their own country as a gesture to cultural customs, but even kisses the Saudis, when they visit him in the US. He also holds hands with them. And yet, Europeans are supposed to be the softy weasels from Venus that do anything to get cheap oil.

A new round in transatlantic bashing: Denis, a French expat in the US, writes in SuperFrenchie:

They may call each others moonbats and wingnuts, but whether they're sporting long hair or military haircuts, Americans by and large all agree on this: America is the greatest country in the world, the American way of doing things is the only possible one, and everybody supports the troops. They learn that in schools from the earliest age, along with the fact that everything else (and everywhere else) is, by definition, flawed. And that's if they're taught anything about other places at all. History of the world in high school, for example, is a 2-semester optional course! Geography manuals do not exist. Innocent until proven guilty, to them, is a uniquely American concept.

So when I read in Foreign Policy magazine that "millions of children are being raised on prejudice and disinformation," I felt some optimism. Finally, I thought, someone is going to tackle the problem of bias and lack of openness to the world in American schools. Oops! They were talking about France and Germany.