Global Economic News

German Energy Prices Are Soaring, Thanks to the Renewable Hoax

Oct. 7 (EIRNS)—The high price of "Green energy" in Germany is costing the consumers close to an extra 10% in their energy bills. The Frankfurter Allgemeine Zeitung reports that the actual cost of electricity is only 35% of the bill, while another 24% is related to the electrical grid in one way or another. The rest of the bill comes from taxes, including the value-added tax (VAT) which is 19%; the so-called tax for Kraft-Wärme-Kopplung (KWK, combined heat and power generation), which is close to 10%; and the tax under the Erneuerbare-Energien-Gesetz (EEG, Renewable Energy Law), which has gone sky high, because it is devoted to development and expansion of renewable energy production, including wind turbines and photovoltaic panels.

The newspaper reports that, looking at the average cost per household, the biggest jump was from 2009, when the percentage rise in the monthly energy bill was 5.6%, and so far in 2010 it has been 8.6%. In real numbers, they show EU5.3 billion for 2009 and an estimated EU8.2 billion for 2010. (The average household this year pays EU6 per month for the "revolution" in energy, and the price is constantly rising.)

The increase is due to the expansion the electricity grid to bring in the huge parks of wind turbines and solar panels. The "grid companies" are regulated by the Federal Network Agency, which said that the "grid companies" had been overpaid in the last years by EU1.5 billion, which is an outcome of privatization. On the other side, energy associations are saying that there has been too little investment in the energy grids, and because of the investment in renewables, the distribution networks are not large enough. They say that for Germany alone, it will require 3,500 km of a new "smart grid" in order to bring online the wind turbines and solar panel parks—guess who will pay for this. The EEG law compels Germany to prioritize putting the renewable energy onto the network.

Meantime, one interesting element is that the green Maschinenstürmer—luddite saboteurs—are also blocking the development of the power grids in Germany, which are needed to bring the renewable energy online.

Hyperinflation Demands from the IMF, Chicago Fed

Oct. 5 (EIRNS)—As Japan announced a gigantic, $418 billion Quantitative Easing this morning, the IMF issued an hysterical cry for hyperinflationary money-pumping, with cheerleading from Chicago Fed chairman Charles Evans, among others.

The IMF's Global Financial Stability Report was also released today, screaming for more money printing, as the Fund prepares for its annual meeting in D.C. this weekend. The report warns that "Progress toward global financial stability has experienced a setback since April ... [due to] the recent turmoil in sovereign debt markets," and that "Planned exit strategies from unconventional monetary and financial support may need to be delayed until the situation is more robust, especially in Europe.... With the situation still fragile, some of the public support that has been given to banks in recent years will have to be continued." The greatest threat to the "recovery," it states, is the global financial system!

The Fed's Evans was more blatant—drive up inflation, he said, in order to "bring down the real cost of credit." Like New York Fed chairman William Dudley, Evans said that for the Fed to buy (worthless) assets is fine, but it must also "overshoot its informal 2% inflation target for a time." This is the suicidal trick to get a negative borrowing rate through forced inflation.