In case you missed it, they (again) finally seem to have sorted out a compromise cabinet, plus a few policy agreements which many are predicting are likely to lead to the coalition’s (and perhaps the country’s) imminet collapse – largely thanks to the guaranteed popularity-winners of a 3% VAT hike, raising the retirement age and cutting public spending all at the same time. Nice.

As such, Anatole Kaletsky of The Times (about whom I keep hearing good things, though will admit to rarely reading) is also predicting disaster (via) –

“Germany�s plan to cure its self-confessed economic failure by doing exactly the opposite to what modern economics would suggest is certainly a bold and novel idea. Jim O�Neill, the chief international economist of Goldman Sachs, remarked on television last week that German politicians are acting as if they had never seen an economics textbook, much less understood one…

“the Merkel tax hike will probably condemn Germany to depression for the rest of this decade and quite likely trigger an Asian-style financial crisis in much of Eastern Europe some time in the next year or two.”

Hurrah!