When I used to read the business section of the newspaper, mainly out of philological interest, I'd make fun of the expert jargon. The vocabulary of finance has borrowed heavily from weather forecasts. One speaks of "market perspectives," of "economic highs," of a "brightening" or a "dampening of the atmosphere," of a "climate of consumption."

A second major source seems to be the terminology of sex therapy. "Analysts" speak of "interrupted" or "growing consumer interest", which ideally peaks in a "consumption rush", they refer to the entrepreneur's "appetite for" or "disinterest in" investment – not to forget terms like "climax" and "sleeping off." To judge from its choice of words, the business world seems to be full of eternally pubescent patients who are swept this way and that, according to their whim.

On reading further, however, my sarcasm diminished. Economists of the world seem to agree that "the mood" is a decisive economic factor.

This temperamental child called "Mood" does respond to objective factors such as current developments on the labour market, growth rates or half a sentence of the President of the American Central Bank. "Mood" can, to a certain extent, be measured. Nonetheless, there's a high degree of uncertainty in such calculations, because "Mood" responds to non-economic happenings – a terrorist attack, a sudden change of government, a flood. As ridiculous as it seems, bad weather on the last two weekends before Christmas can wash out the annual balance sheet of retail sales.

And nations respond differently again to the same event. The reaction depends on the mentality, habits, historical experience and self-confidence of the people. In the unlikely event that Americans and Germans were to register exactly the same economic data in a given quarter, they would definitely not react in the same way. With zero growth, as is the case in Germany, Americans would presumably continue to blissfully consume and, with their notorious willingness to go into debt, unwittingly boost the foundering economy.

In this situatation we Germans tend - there's no need to speculate here – to save. As matters currently stand, we boast the highest savings rates (10.5% of net income) in all of Europe. And this, although Germany remains one of the wealthiest countries in the world with the third highest social standard. By the year 2010, roughly 1,000 billion euros will have been bequeathed; by the end of 2004, private accounts, very unevenly distributed, had accumulated 10,000 billion euros in gross assets. There's something desperate about a government that has to threaten the tough customer known as the consumer with a raised – and now postponed until 2007 - value added tax, in the hopes that he will be driven into a consumption craze, at least for a year! One smart alec claimed that the government would have had to threaten a value added tax of at least 30% to loosen up the German constrictor muscle.

Psychologists have interpreted this impulse to hold on as "panic saving." The explanation they offer is that, since the post-war years of hunger, Germany has experienced an almost constant period of growth, leading to the illusion that ascendency should be something constant, infinite and continuous. It did in fact seem as though the law that prescribes that boom leads to bust had been suspended. Incomes seemed to be increasing according to the guidelines for the pay-scale of German bureaucrats.

But does that really explain the very peculiar delay and rigidity with which Germans responded to the economic standstill and its underlying structural crisis – a situation that had been anticipated well in advance? Obviously a mental factor is involved, a basic attitude of sorts. No profession has influenced the German view on life as greatly as the class of bureaucrats and civil servants, with its guaranteed "appointment for life," irrespective of individual achievement and general economic development. No other industrial country features a comparable degree of participation in this professional sector. In all the hasty reforms that followed the shock of the PISA results, this bastion of German immobility and sullenness remained untouched, which is not surprising when one considers that the "party" of the civil service makes up the majority in the German parliament, regardless of who wins the election.

The art of minimising risk makes sense to a certain degree; all peoples practice it. But we have refined it to the point that foreign observers occasionally have the impression that we've succeeded in abolishing not only life's risks but life itself. Certain is, that if a positive mood is a pre-condition for economic rebound, Germany doesn't stand much of a chance. I'm often reminded of the saying with which a friend of mine prepared me for the USA: anyone who makes it through the door to the USA gets 10 points in advance, which they can bring down to zero pretty quickly. In Germany, you start with minus ten points which, if you're lucky, you can work up to zero. There has been, according to the latest surveys, a "brightening of the mood" but who invests any faith in these after the absolute failure of all polls and prognoses in the last elections?

There's no question about it, we have serious grounds for concern. Anyone who is not yet depressed, need only turn on the news. Every morning at 5:30, astonishingly lively, well-paid and upbeat newscasters provide their listeners with a daily ration of bad tidings: Deutsche Telekom has to cut 32,000 jobs, DaimlerChrysler has to lay off 16,000, Volkswagen would like to get rid of thousands of employees, Deutsche Bank wants to send 6,400 packing, Allianz is in the running with 8,000 jobs to strike, in Nürnberg, 1,750 workers are fighting for the survival of the headquarters of AEG. And all this, although most of these companies are raking in the biggest profits in years. If jobs are actually being created in Germany, we're not hearing about it. Good news is the sole preserve of the weather forecast which, in Germany, is no guarantee of pleasant surprises.

The atmosphere of crisis which is confirmed daily in the news, is exacerbated by the suspicion that there's been a fundamental change in the social market economy. The saying that what's good for the company is good for the job market has been inverted. The higher a company's profits, the more likely it is to strike or export jobs. The new formula is: ten percent less expenses for the personnel = forty percent more profit.

But the lost jobs don't disappear, they go elsewhere, to cheaper countries that we've invited into the competition. The well-worn words of comfort that fall so easily off the tongues of politicians of all parties, that Germans have to focus on their strengths and work better and more innovatively than the cheaper competition, sound like fairytales. Who's to say that the Indians and Chinese, once they've finished destroying their traditional local industries – like textile manufacturing - won't flood our markets with smart products from pharmaceutical, computer and nano- technologies for a tenth of the labour costs. Those who are so inclined will see the results of anarchic justice: the plundering of the former colonies is now being followed by a "plundering" of jobs in rich countries by the poor. But this is not a uniquely German fate. The question remains, why smaller neighbouring countries like Holland, Denmark, England and Sweden, which have exactly the same grounds for concern, have managed to improve both their situation and their morale.

The German tendency to save so obsessively on food can certainly not be explained with shrivelling purses. Big discount chains have succeeded in practically eliminating small and mid-sized stores - at least those unable to save themselves with some form of specialisation – from the cityscape. I don't have the impression that chains like Lidl, Plus, Aldi etc. have conquered France and Italy to nearly the same extent. After the most recent rotten meat scandal, nutrition experts tried carefully to make clear to German consumers that chicken for 1.50 Euros in the supermarket is not a reason to grab but rather to move on, quickly. The discount chains were not invented for the poor; you're more likely to find them behind the till, or packing and sorting. It's perplexing that the well-off middle and upper classes are lining up at the cashes of discount stores. One can indeed speak of cultural poverty. It's the better earners who are setting up to a quarter of their earnings aside and then, in the event of tragedy, opting for a bargain burial (including cremation in Ukraine).

In no other country in the world are so many people choosing to live as singles as in Germany. More and more women (14.6%) and men (23.6%) are content with the idea of having no children. "A rejection of children," commented Interior Minister Otto Schily in response to the statistics from Wiesbaden, "is a rejection of life." Other commentators refer to a hidden death wish. A plucky defender of the sinking birthrate found herself in a talk show. The woman rather liked the idea that there would soon be only 60 or 50 million Germans. The creators of the "Geiz ist geil" (stinginess is sexy) campaign seem to have formulated a principle with which Germans are already very comfortable.

I am summarising data, observations and speculations about a mental condition that is best described as "German melancholy." Something is gnawing away at the German soul, something that won't be pinpointed by the instruments of analysts and polling institutes.

When was a melancholic ever uplifed by a "chin up" and a reference to the fact that his situation is, in objective terms, enviable. In antiquity, melancholy – a well-known emotional condition – was defined as an "excess of black gall" which had "gushed into the blood." No subsequent explanation, from Kierkegaard to Freud, was able to meet the power and poetry of this description. Freud's definition of melancholy is good for a parenthesis at best; among other symptoms he refers to "the debasement of self-worth, expressed in insults and accusations against the self."

It has often been remarked that Germans suffer from a highly irritable sense of self-worth, maybe even an infectious self-hatred. Also, that there are good reasons for this dysfunction – and not just since Auschwitz. But nonetheless, there's the question of the chicken and the egg: is the lack of self-love a result of Hitlerism or is Hitlerism a result of this lack?

In the last years, German melancholy has been on the increase. Since the end of the war, the singular German crime – after an almost twenty year period of repression – has pushed its way to the fore. Knowledge of this crime has expanded greatly; on the various anniversaries, viewers are confronted with ever more pictures and documentations in television. The art of teaching children and the children of the war about this German crime without generating something like a feeling of guilt, seems to have not yet been discovered – despite the guilt-induced obligation to distinguish between guilt and responsibility. The attempts of the German government to establish the "totally normal German people" in the international community remain unconvincing because any attempt to present a "nation" as normal tends to demonstrate the opposite.

Halfway "normal" peoples want under no circumstances to appear "totally normal", but rather unmistakable, extraordinary, unique, excellent – think only of the French myth of the "grande nation" or the American self-aggrandizement as "the greatest nation in the history of mankind." The self-worth of the Germans is and remains damaged; an awareness of this damage is probably much more acute today than it was 30 or 40 years ago.

The recognition of this damage is no occasion for pride, but rather the basis of a new and cautious self-confidence. In any event, melancholics and doubters are preferable to cholerics and megalomaniacs. The simple statement of a young person who finds it "ok" to be German expresses more optimism than all calls for "more national pride" and a German "Leitkultur" (defining culture).

By the way, there is one people in Europe that is more pessimistic than the Germans. But the Italians draw very different conclusions from their notorious distrust of the future: Carpe diem! One celebrates the moment and lives with abandon in the present. And an Italian would rather be drawn and quartered than buy a pre-packaged beef filet at Plus.

A list of international scrooges:

Savings rates 2004 (percentage of savings from income)
France 11,8 %
Italy 11,5 %
Germany 10,5 %
Norway 10,2 %
Ireland 9,9 %
Switzerland 8,9 %
Austria 8,3 %
Netherlands 7,3 %
Japan 6,9 %
Finland 2,7 %
USA 1,8 %
Australia -3,0 %
Source: OECD Economic Outlook 78 Database

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This article originally appeared in German in Die Zeit on January 12, 2006.

Peter Schneider, born 1940 in Lübeck, is a Berlin-based writer. His latest novel "Skylla" was published in 2005 by Rowohlt.

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