Wer an den Rekordschulden verdient

Summary

Maurice Höfgen critiques a ZDF WISO report on Germany’s rising public debt. His central argument is that debt totals alone do not show whether borrowing is harmful. The relevant questions include how debt compares with economic output, what it finances, which currency it is denominated in, and how interest costs are measured.

These are Höfgen’s interpretations and criticisms of the report, not an investment analysis.

Main arguments

• Nominal totals and per-capita framing: Höfgen objects to emphasizing Germany’s €2.8 trillion of debt, its many zeros, or a figure of more than €33,000 per person without putting those figures in economic context. He says government liabilities are also financial assets held by the private sector. That does not mean they are evenly distributed or that each resident has an equivalent amount in their account.
• Debt and economic activity: He argues that Germany’s earlier balanced budgets and reduced public debt coincided with weak net public investment and an infrastructure backlog. He also says the 2026 growth outlook described by the five leading German economic institutes is driven substantially by public consumption and investment, which he links to additional borrowing.
• Comparing countries: Höfgen considers debt-to-GDP more informative than nominal debt, but says it should be read alongside trade balances and domestic demand. In his account, Germany’s export surplus and the United States’ import surplus produce different economic dynamics that the debt ratio alone does not capture.
• Japan: He explains Japan’s high public debt in part as a response to private-sector deleveraging: when companies save to repay debt, government borrowing can support demand. He rejects the idea that domestic versus foreign bondholders is, by itself, the decisive test of debt sustainability. He emphasizes the currency of denomination, contrasting local-currency debt with foreign-currency debt.
• Who holds German debt: The report says foreign investors hold a large share, while German banks, insurers, funds, and other investors hold substantial amounts domestically. Höfgen argues that, within the euro area, the identity of the bondholder matters less to the German state than the fact that the liability is denominated in euros.
• Central-bank holdings and interest: The Bundesbank holds a large stock of German government bonds, acquired largely through ECB bond-buying programs intended to lower longer-term rates. Höfgen says interest paid on bonds held by the central bank can, in principle, return to the state through central-bank profits. He notes that the Bundesbank has recently faced losses because it holds low-yielding bonds while paying interest on bank deposits. He argues that central banks do not need to operate like ordinary profit-making businesses.
• What borrowing funds: Höfgen disputes treating government budgets as separate “pots” for investment and consumption. He argues that borrowing can support demand even when it funds current spending, while investment in infrastructure, education, or defence can also benefit future generations. His broader test is whether the spending supports prosperity and output relative to its costs.

Key figures and timelines cited

• German public debt: about €2.8 trillion.
• Debt per resident: more than €33,000, a figure Höfgen criticizes as misleading without context.
• Planned new borrowing: about €204 billion for the following year. The report says debt could rise by nearly €1 trillion by 2030.
• Special fund announced in 2025: €500 billion for infrastructure, defence, and modernization.
• Debt-to-GDP figures cited:
  • Germany: 63.5%
  • Italy: slightly above 135%
  • Japan: above 200%, and at one point above 250%
  • Other G7 countries: described as above 100%
• Bond ownership figures cited:
  • Foreign investors hold 49% of German debt.
  • 37% of foreign-held debt, worth about €480 billion, is held in the euro area.
  • German investors are said to hold almost €700 billion.
• Central-bank holdings:
  • The report says the Bundesbank held about 22% of German public debt, or more than €600 billion, at the start of 2025.
  • Höfgen also cites a peak above €740 billion and refers elsewhere to a figure close to 30%.
• German government bond yields: about 2.5%–3.4%.
• Interest costs:
  • The report cites €4 billion in 2021, about €30 billion currently, and a possible €80 billion by 2030.
  • Höfgen says a government estimate of roughly €40 billion for the current year falls to just under €17 billion under what he considers a more accurate accounting method.
  • He also says a change from 2025 would record costs more appropriately and reduce reported costs by €7.3 billion.
• Höfgen argues that the 2021 comparison is distorted by how bond-auction gains and losses were recorded. His example is a zero-coupon bond sold for €80 and redeemed for €100: he says the gain over the bond’s term should be spread over that term rather than concentrated in one year.

Framework and cautions

Höfgen’s suggested way to assess public debt is to consider:

• Debt relative to economic output, rather than focusing only on nominal totals.
• The country’s trade balance and the effect of external demand.
• Whether the debt is denominated in the country’s own currency or a foreign currency.
• Who holds the debt, while treating currency denomination as more important than the bondholder’s nationality.
• What the borrowing finances and whether it supports future output or prosperity.
• Whether interest-cost comparisons use consistent accounting for bond premiums, discounts, and auction gains or losses.

He cautions against treating government finances as equivalent to household finances, using per-capita debt figures as though residents personally owe that sum, and presenting interest costs per second as meaningful. He also argues that some of the ZDF report’s comparisons exaggerate increases in interest spending because they use a misleading 2021 baseline.

Instruments and entities mentioned

German federal bonds, government bonds, central-bank deposits, the Bundesbank, the European Central Bank (ECB), the Bank of Japan, and German, Italian, Japanese, and U.S. sovereign debt are mentioned. No stock tickers or investment securities are discussed.

Disclosures

No explicit “not financial advice” disclaimer appears. The video is commentary on public debt and macroeconomic policy, not a personal investment recommendation.

Presenters and sources

The presenter and commentator is Maurice Höfgen, from Geld für die Welt. The report discussed is ZDF WISO, with economics reporter Valerie Haller. Other sources mentioned include the five leading German economic institutes’ joint forecast, the Federation of Taxpayers’ bond-ownership research, and Höfgen’s Geld für die Welt newsletter articles.