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%.

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

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.

The Boston Globe writes about an Irish woman travelling to the US for "an extended weekend of binge shopping" and claims: "With dollar low, US is one big outlet: Europeans arriving in droves for bargains"

Meanwhile, Bloomberg's John M. Berry tries reassue his readers in the Seattle Times article "Dollar down, euro up, so what?" He argues that the "U.S. dollar is still at the center of the world's financial system, and its importance isn't fading in the face of exaggerated claims to the contrary." (Via EU Digest)

Lawrence Summers, however, says "Wake up to the dangers of a deepening crisis." Bill Clinton's last secretary of the treasury writes in The Financial Times.

Morever, The Telegraph reports: "China has surged ahead of Germany for the first time to become the world's top exporter, prompting ever louder demands from the United States and Europe to revalue the yuan."

International Herald Tribune:

Cars produced by German manufacturers like Daimler and Volkswagen are getting dirtier even as those from French and Italian manufacturers like Peugeot and Fiat are getting cleaner. Of the major car producing countries in Europe, emissions of carbon dioxide from new cars sold by German automakers increased 0.6 percent in 2006, even as French and Italian car makers cut their emissions by an average 1.6 percent, according to the study published by Transport & Environment, a campaign group for sustainable transport based in Brussels. German carmakers "seem to be intent on building ever heavier, larger and more gas-guzzling cars that simply don't belong in the 21st century," said Jos Dings, a director of T&E.

Pat Buchanan's op-ed "Sinking Currency, Sinking Country" is supposed to alarm Americans:

The euro, worth 83 cents in the early George W. Bush years, is at $1.45. The British pound is back up over $2, the highest level since the Carter era. The Canadian dollar, which used to be worth 65 cents, is worth more than the U.S. dollar for the first time in half a century. Oil is over $90 a barrel. Gold, down to $260 an ounce not so long ago, has hit $800.

These numbers, however, are not graphic enough. What is really alarming is that "hip-hop maven Jay-Z in his latest video shows off his wealth by flashing stacks of 500-euro bills, " writes the Wall Street Journal's Economics Blogger and quotes a Minnesota newspaper that calls Jay-Z the "New Alan Greenspan" 

"It's sad that rap stars can no longer show their style with a good old $500 bills (featuring President McKinley) and now need to flash 500 euros (featuring some sort of suspension bridge). I don't need the chairman of the Federal Reserve to tell me about the state of our economy. I just need Jay-Z, the new Alan Greenspan.

Endnote: Did you know that the evil European Central Bank prints 500 Euro notes in order to appeal to drug smugglers? The Corner on National Review Online