olaf scholz says germany can spend its way out of a possible economic crisis.ay be in a recession. why not use that money now to prevent the crisis? leonie: well, that is a lot to do with their famous or infamous zero policy. what that is is a self-imposed goal of keeping the federal budget balanced. it has been basically the pillar of german fiscal policy under angela merkel and her finance ministers. the chancellor has repeatedly argued that it is important not to burden future generations with more debt, especially in light of germany's aging population. it is safe to say angela merkel and olaf scholz are committed to that black zero policy. but they are facing really harsh criticism, not only by politicians from the opposition who are demanding more investment and investment boost and infrastructure, and climate protection measures, but also because now as he said, germany is facing an economic slowdown. olaf scholz has repeatedly stressed and argued today that the government will only act if the slowdown is turning into an actual economic crisis. brent: th

alix: in germany, a finance minister, olaf scholz sticks to , the balanced budget, while providing insurancen case of a crisis. he said it is essential that we are in a position with the fundamentals we have two respond with many billions if indeed an economic crisis erupts in germany or europe. do you agree with him? >> the stimulus debate has not happened in germany yet. it is more international because everybody wants germany to get the economy especially in europe , going. it is more the feeling of the economy doing well, until there is no domestic demand decline on a considerable scale. the german government is not willing to give up a balanced budget. scholz has said we have billions , and billions of euros ready, but at the moment, there is really no crisis and we are not doing anything. >> a double dose of good news for fannie and freddie in esther's. -- investors. won a big-- shell victory. seemingly, billions of dollars of company office currently go to the government could end up winding to be happy hedge funds. >> the policy that these hedge funds are litigating over is that bill

matt: we need you to come here and tell that to angela merkel and olaf scholz.out u.s. rates. alan greenspan said it would be no big deal if u.s. rates went negative. do you agree with that? do you think that is a possibility? etsy: i don't think it is likely, unless you have a really parable -- terrible growth scenario. it is not likely. where am i agree more and being swift myself -- swiss myself, negative rates are pretty mainstream. it would probably not be the end of the world but it would signal -- so the rates itself would not be the end of the world. it would signal a very dire economic scenario. the starting point is already lower from rates compared to where we were in 2008. i don't think the next slowdown will look like the global financial crisis. we will have some kind of slow down or downturn but i don't think we will have anything like what we saw 10 plus years ago. it would really take a lot to get u.s. rates into negative territory. imagine where the rest of the world would be if you had that scenario. on a purely absolute level, negative rates

. ♪ ♪ olaf scholz speaking.is one thing investors and the markets want to know about, is about fiscal stimulus. saying he is presenting a solid budget. germany also has a strict rules on what he can or can't do. we will have to keep an eye on this. as we listen to him, the main takeaway is, are we going to have to have a recession of -5% in germany for them to start spending? erik: i don't think so, but your point is well taken. the german budget is actually expansionary already, one of the few ones in europe. they have the rules of the balanced budget and there is a huge commitment, as you heard him say now, to it. germany is almost technically -- certainly in a technical recession right now. certainly, a lot of germans understand that the need -- they need to invest more and do more at this stage. certainlyably and not enough of what i would like to see. francine: that is probably one of the big challenges for christine lagarde. the largest and investor in we work is pushing the company to put off its ipo. sof

matt: peter alt meyer saying he wants to talk about corporate tax reform with all of schulz, -- olaf scholzo much talk about helicopter money, a fiscal monetary collaboration. what do you think about for central banks? axel: new tools have been used because rates have been negative bound. there is a limit to how low negative interest rates can go because ultimately it will drive out cash from the economy. they are flooding the market with liquidity. that does not lead to investments because whilst liquidity is there, you need investable and bankable projects. the government can play a facilitative role by having expansive investment policies. germany has a backlog on infrastructure. many areas where you could to long-term, impactful investments that you could fund. germany needs to move into that space. tax reform is an obvious tool, and if you need to have those eyes on the consumer and corporate, you should have a combination of income tax reform and corporate tax reform. the last thing we heard out of germany is it will not happen anytime soon, but it should because the u.s. has changed