Earlier today we wrote that Germany’s largest landlord, Vonovia, had taken the unprecedented step of restrictring heating at night, a terrifying preview of what lies in stock for the “most advanced” European nation this winter. Alas, it’s going to get worse, much worse.
According to the FT, Germany is now rationing hot water, dimming its street lights and shutting down swimming pools as the impact of its energy crunch begins to spread like the proverbial Ice-Nine wave, from industry to offices, leisure centers and residential homes.
The reason behind Germany’s slow motion paralysis is well-known: the huge increase in gas prices triggered by Russia’s move last month to sharply reduce supplies to Germany has plunged Europe’s biggest economy into its worst energy crisis since the oil price shock of 1973 (see ” What’s Unfolding In Europe In Recent Days Is A Fresh Big Negative Supply Shock “) With electricity prices hitting never before seen levels, gas importers and utilities are fighting for survival while consumer bills are going through the roof, with some warning of rising friction (not to mention the infamous wheelbarrows full of cash).
“The situation is more than dramatic,” said Axel Gedaschko, head of the federation of German housing enterprises GdW. “Germany’s social peace is in great danger.”
Unfortunately, as tensions over Russia’s war in Ukraine escalate, officials fear the situation could get worse. On Monday, as we reported last week, Russia is shutting down its main pipeline to Germany, Nord Stream 1, for 10 days of scheduled maintenance. Many in Berlin fear it will never reopen .
Commenting on the infamous July 22 day when Russian gas flows are expected to resume, DB’s Jim Reid writes that “while we all spend most of our market time thinking about the Fed and a recession, I suspect what happens to Russian […]
They’re Trying to Shut Us Down
Over the last several months, I’ve lost count of how many times the powers-that-be have tried to shut us down. They’ve sent hackers at us, forcing us to take extreme measures on web security. They sent attorneys after us, but thankfully we’re not easily intimidated by baseless accusations or threats. They’ve even gone so far as to make physical threats. Those can actually be a bit worrisome but Remington has me covered.
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