Data from 25 EU countries from 2001 to 2015 were evaluated
In shops all over Germany, they note what fruit and vegetables, books and magazines, shoes and furniture cost. What is the list price for a car, what does a package tour cost, what is the fuel at the gas station? More than 300,000 individual prices of goods and services are recorded representatively according to an always identical scheme. The prices of around 600 types of goods, which make up the so-called shopping basket, are collected. On this basis, statisticians calculate the development of inflation.
Does online retail also play a role in this?
The statisticians not only keep an eye on traditional shops, but also on the Internet. Around 10,000 prices are collected on the Internet each month, usually at a specified time. “If online retailers change their prices particularly frequently, we adapt our price survey,” explains Thomas Krämer from the Federal Statistical Office. Some economists had criticized that the sometimes strongly fluctuating offers on the network were not sufficiently taken into account when calculating the inflation rate.
Why is the shopping cart regularly checked?
As a rule, the Federal Statistical Office reviews the weighting and composition of the shopping basket every five years. Because consumer habits change, certain products no longer exist and new ones come onto the market. Changes are particularly evident in the longer term. “In the Federal Republic of Germany’s first shopping basket from 1950, food had a share of more than 50 percent. Today, living expenses are the largest item,” reports Krämer.
Where does the feeling come from that the official rate is wrong?
The rate of price increases is an average value that does not necessarily do justice to the individual consumer and their individual shopping behavior. In addition: “There are prices that people perceive particularly strongly. These are mainly goods that are regularly bought and often also paid for in cash, for example bread or other groceries. Price changes are quickly noticed here. This also applies to fuel prices” explains Krämer.
Why is it important to monitor consumer prices?
If prices climb sharply on a broad front over a longer period of time, people can afford less and less for their money and lose some of their savings. When inflation is high, money rapidly loses its value and consumers flee to substitute currencies. After the Second World War, cigarettes were a popular currency in Germany. But permanently low or falling prices can also be dangerous. They can get businesses and consumers to put off investing – and that can slow the economy down. The central banks are therefore closely monitoring how inflation is developing. If necessary, the monetary authorities counter this, for example with interest rate cuts or increases.
Why doesn’t inflation hit all consumers equally hard?
According to a study, necessary expenditures, for example for food, rent and energy, make up a larger proportion of their budget for less financially strong families than for private households with higher incomes. If the prices for such goods and services rise faster than those of luxury products, households with low incomes will be more burdened, according to the result of a study by researchers at Goethe University Frankfurt. Inflation tends to be at the expense of the poor. Data from 25 EU countries from 2001 to 2015 were evaluated. In Germany, the price of the shopping carts of the bottom ten percent increased by around 4.5 percent more than the shopping carts of the top ten percent.
The lira crisis is driving up the inflationary spiral in Turkey. At 18 percent, consumer prices reached the highest rate of inflation since 2003 in August. Analysts have not yet reached the end of the flagpole.
The lira has been under heavy pressure for months.123helpme.me In August, the currency crashed particularly rapidly to new record lows against the euro and the US dollar. One euro was now worth over 8 lira, at the beginning of the year it was 4.5 lira. There has not yet been a sustained recovery.
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The decline in the value of the Turkish national currency is causing the prices of imported goods to soar. This, in turn, is driving inflation – well beyond analyst fears. The statistics office in Ankara announced that consumer prices rose by 17.9 percent year-on-year in August. In July, the rate was 15.85 percent.
Central bank independence at risk
The trigger for the crash in August was, among other things, a dispute with the US over the imprisonment of a US pastor in Turkey. In addition, investors see the independence of the Turkish central bank in danger. In the long term, Turkey is facing high foreign trade deficits, high foreign debts and rising interest rates in the USA.
Inflation: Inflation – What It Means For Consumers
Inflation could climb to 30 percent
Tatha Ghose, an expert at Commerzbank, warns of a further significant acceleration in inflation. The worsening of the lira crisis in August is not even reflected in the recent rise in inflation, says Ghose. It is merely “a legacy of the past depreciation of the lira”. By the end of the year, the expert expects an increase of between 25 and 30 percent.
Another indication of a further acceleration in inflation is that so-called producer prices rose by over 32 percent in August. They reflect the price level at the manufacturer level, i.e. not yet in retail, and are used as a preliminary indicator for the development of inflation
Sources used: dpa-AFX
The Danish government is pressing ahead with the project at full speed, but ferry operators and environmentalists in particular are working hard against it. A new study should now show that the planned tunnel under the Fehmarnbelt would not be economically viable.
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A study, however, which was commissioned by the shipping company Scandlines. And with the ferries between the German island of Fehmarn and the Danish island of Lolland, it operates the most important traffic artery between Germany and the Scandinavian countries Denmark and Sweden.
A fat business that a new tunnel would of course put at great risk. After long delays, important preliminary decisions about the future of one of the largest European transport projects are being made this year.
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Visualization: This is what the tunnel entrance should look like on the Danish side one day. (Source: ICONO A / S for Femern A / S dpa / dpa)
The planning for a tunnel under the Fehmarnbelt, a strait about 18 kilometers wide between Germany and Denmark, is reaching its decisive phase. The plan approval decision is to be issued next year. But there are still many open questions and high risks.
The clear political will of Denmark to implement the project is certain. A state treaty between Denmark and Germany on the project has been in force for more than seven years. Since then, the project has been approached half-heartedly on the German side, quite differently on the northern European neighbors.
Four-lane motorway and railroad tracks
A tunnel is planned under the Fehmarnbelt with a four-lane motorway and a double-track rail link, which will link the economic areas of Denmark and Sweden more closely to the northern German region and ultimately to all of Europe. “This would make Hamburg the southernmost metropolis in Denmark,” enthuses the President of the Hamburg Chamber of Commerce, Fritz Horst Melsheimer, who is also a fan of the project.
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“Most terrible event in corporate history”
The tunnel builders hope for advantages for tourism and new jobs on both sides of the Belt through the settlement of companies. Young people should have it easier “to live on one side of the Baltic Sea and at the same time work or study on the other side”, says the website of the project company Femern A / S, which is 100 percent owned by the Danish state.
Denmark wants to bear the estimated costs of 7.4 billion euros alone, and reserves of one billion are planned. Femern A / S is to finance the sum through bonds with good interest rates on the capital market, and the Danish state guarantees the repayment.
Tolls for the tunnel
Ultimately, users should pay for the tunnel via tolls. Consideration is given to amounts of 65 euros for cars and 267 euros for trucks for one pass. (For comparison: the ferry trip by car currently costs between 30 and 100 euros.) There are also EU subsidies. According to the operators, the tunnel could be paid for in 36 years.
“It doesn’t work out,” says Lars Handrich, head of DIW Econ, the consulting subsidiary of the DIW business research institute. The institute prepared a new report for the German-Danish shipping company Scandlines, which is fighting against tunnel construction.
According to the calculations, the tunnel will be an economic disaster. The number of expected passengers and the calculated changes in freight traffic are far too high, and all the assumptions in the operator’s calculations are far too optimistic. Handrich recalls the bankruptcy of the Eurotunnel, which led investors to lose billions.
Ferry operator does not want to admit defeat
Femern contradicts: “The financial situation of the Fehmarnbelt Tunnel project is solid, which is documented in the financial analysis for the project,” writes Finance Director Allan Christensen in an email. The analysis was carried out by independent auditors in 2016 on behalf of the Danish Ministry of Transport and the parliamentary parties that support the tunnel construction. “Everything has been checked and published.”
The operators assume that the tunnel will displace competing ferry lines from the market and thus enforce monopoly prices. But Scandlines does not want to admit defeat. “We will definitely continue,” affirmed Scandlines boss Søren Poulsgaard Jensen.
His company operates the Vogelfluglinie with modern ferries between Puttgarden on Fehmarn and Rødby as well as another connection further east between Rostock and Gedser. The traffic volume of these ferry lines – most recently around 7.6 million passengers and 620,000 freight units – are largely added to the tunnel in the official calculations.
The tunnel builders cite the savings in time, fuel costs and climate-damaging CO2 as advantages for travelers. Thanks to the new connection, the train journey from the Hanseatic city to Copenhagen will in future only take two and a half hours. Today you are on the road for four and a half hours. There is no waiting for the ferry.
Scandlines boss Jensen expects that he would lose more than half of his business through the tunnel. With the remainder and a thinned-out schedule, it would still be profitable.
In addition to profitability, there are still other questions unanswered. The project has a huge dimension; 5000 workers would be employed for years. But many detailed questions about environmental protection and ship safety on the busy Fehmarnbelt have not yet been resolved. In the ongoing proceedings on the German side, around 12,600 objections have to be dealt with – including from Scandlines. In the Danish approval process there was 43 in the same phase.
Starting shot no later than 2019
Actually, the construction of the tunnel should start in 2019 at the latest in order to receive the full promised EU funding. But the appointment is shaky. As soon as the planning approval decision has been passed, environmental groups will complain about it. The process up to the Federal Administrative Court can take years. At present, construction seems to start in 2020 and completion by 2028; but it can also be 2030. The original plan was 2018. Many objections and improvements have delayed the project for years.
Scandlines boss Jensen fears that in the end the Danish state will be responsible for the expected losses of the tunnel company. “That would make it difficult for us to counter that.” That would be bad news for Danish taxpayers. But the tunnel is not free on the German side either. More than two billion euros are budgeted for connecting the hinterland via new road and rail routes.
The grocery retailer Kaufland informed its customers in an info mail today that the delivery service will be discontinued on December 23, 2017. It’s a surprise for customers.
Kaufland customers who have been able to enjoy the delivery service in Berlin since October 2016 as a pilot project received an email on December 8th. There you can read the following:
“Unfortunately we have to inform you today that we will discontinue our delivery service in Berlin on December 23, 2017. We will deliver orders that have already been received and are still in progress up to and including December 23 with the quality and reliability you have come to expect (…) With a view In terms of profitability, however, we see that a delivery service in the food sector cannot cover costs in the long term. For this reason, we will end our pilot phase on December 23rd and discontinue our delivery service offer on that day. “
Downsizing affects 300 people
With this announcement, around 300 jobs in the areas of logistics and delivery in Berlin will also be cut at the end of the year.
“We very much regret that we cannot offer the employees in Berlin long-term prospects and we thank them for their outstanding commitment over the past few months,” says Patrick Kaudewitz, CEO of Kaufland. The company is currently working out socially acceptable solutions.
Penarikanal instead of expansion
In the summer of 2017, Kaufland announced the expansion of its delivery service to Hamburg.