Construction costs are currently skyrocketing

Almost exactly my story... Sent about 15 inquiries in August, received 5 replies, 2 on-site inspections in September / October, 1 company is now waiting for the energy consultant calculations to make an offer (but at least they make a good impression and have a great reputation). Now I just have to see that the company still considers itself competitive... P.S.: Estimated volume 250-300k, so there's something to be earned from it...

You hear this from everywhere. For us, the volume is of course much smaller, as it is only the ground floor. But apparently the companies are booked up until who knows when and don't need orders in the foreseeable future. I’m keeping my fingers crossed for you. For us, at least, it can remain as it is in an emergency, since we already live inside. I'm glad that we are not absolutely dependent on craftsmen. If necessary, we'll do it little by little ourselves, just like we’ve done almost everything so far. Of course then without any subsidy, because we can't find an energy consultant either :mad:.

If you actually have to rely on the capital market for retirement, demand flows there instead of into the real economy. Then, of all things, the real capital stock is gnawed away by demand shortfalls, which later is supposed to pay out that very funded pension. It doesn't logically add up. But you probably won't notice until you've driven the cart into the wall, like with so many things.

In my opinion, it is just a time-delayed demand, because the accumulated pension capital is supposed to be used up for one's own retirement. The contributions of the generation that is the first to save for themselves do not disappear but are supposed to be fully taken over by the state, ergo no loss of demand.

It’s no use knowing what should be done if it can’t be enforced.

As mentioned, it will (or something similar) have to be done and then implemented when the retired majority is on the one hand small enough that the barely noticeable pension can be fully taken over by the state and the minority paying contributions is happy about lower contributions and more autonomy.

In my opinion, it is only a time-delayed demand, because the accumulated pension capital is then supposed to be used up for one's own pension. The contributions of the generation that saves for themselves first do not disappear, but are supposed to be fully covered by the state, ergo no loss of demand.

And then every retiree gradually reduces their capital to zero targeted at death excluding funeral costs? How? And: Why?

Pensions must always be taken from current income, where else?

There is, however, a difference. The pay-as-you-go pension system based on wages and salaries, as we have it now, can only draw its benefits from wages and salaries in Germany. This poses multiple problems: Firstly, demographics are worsening; instead of 2 or 3 workers per retiree, the ratio will soon be reversed. Secondly, it relates only to labor, but there are other factors of production. Currently, automation, i.e., capital, is especially important. Thirdly, the levy is imposed on all labor, regardless of whether the respective company is on the brink of bankruptcy or is generating record profits.

A funded system also allows other factors to be tapped very easily. Capital gains are primarily generated in profitable sectors. Capital gains can also be generated outside Germany. In the economy of industrialized countries, capital is the dominant factor. However, we still conduct social policy as if labor dominated decades ago, partly due to favorable demographics. Of course, this could now be managed through tax subsidies, but the problem is that in practice taxes are easiest to collect from the middle class and hardest from international corporations. However, capital gains can very easily be collected from these via the stock market.

It is not an either-or, but a both-and. Some countries realized this ages ago and stabilized old-age provision on multiple pillars in the form of a statutory pay-as-you-go pension and funded capital in the form of private provisions and occupational pensions. Here in Germany, there is no courage to demand serious private provision from people and to give them the necessary freedom to do so. Here, private provision has rather been seen as short-time work for insurance agents, and in the end, you get 50€ Riester pensions.

And every retiree then purposefully depletes their capital to zero by death excluding funeral costs? How? And: Why?

No, they can already blow it up beforehand (and then live off the basic pension) or inherit it. That is possible now too, a retiree can spend or save and inherit their pension. In fact, this even preserves more demand, since a prematurely deceased person who receives less than their contribution payments as a payout would, in my model, continue to inherit the remaining capital stock instead of it just resulting in fewer payouts. So my model would even be demand-stimulating.

(I call it "my" model without any claim to authorship, it is just easier in the context of this thread).

There is a difference though. The pension based on the pay-as-you-go system on wages and salaries, as we have it now, can only draw its benefits from wages and salaries in Germany. This is a problem in several ways: First, the demographics are worsening, instead of 2 or 3 workers per retiree, the ratio will soon be reversed. And second, it only relates to labor, but there are other factors of production. Currently important is especially automation, i.e., capital. Third, the levy is applied to all labor, regardless of whether the company in question is on the verge of bankruptcy or making record profits.

A funded capital system also very easily allows tapping into the other factors. Capital returns are mainly generated in profitable sectors. Capital returns can also be generated outside Germany. In the economy of industrialized countries, the capital factor dominates. But we are still doing social policy like decades ago when labor dominated, partly due to favorable demographics. Of course, this could now be regulated via tax subsidies, but the problem is that in practice taxes are easiest to collect from the middle class and hardest from international corporations. Capital returns can very easily be collected from these via the stock market.

It is not an either-or but a both-and. Some countries recognized this ages ago and have made old-age provision stable on several pillars in the form of a statutory pay-as-you-go pension and funded capital in the form of private provision and company pensions. Here in Germany, they lack the courage to ask people for serious private provision and to give them the necessary freedom for it. Here private provision was rather seen as a job creation measure for insurance agents and in the end, you get 50€ Riester pension.

You describe the problem completely correctly.

You also name the solution: tapping into capital returns.

So sharing the profits of companies in pensions. This is possible via the stock market but only with companies that also place products there (bonds/shares). Alternative?

The problem I generally pointed out remains: demand for a company’s shares cannot be the same as demand for a company’s products. Only the latter generates the revenues from which pensions must be paid.

It is national accounting: What is saved in total by acquiring the funded pension entitlements must come into the system elsewhere as debt, otherwise it does not work. Who is supposed to take on this debt?

You simply cannot avoid a few “laws of nature” of economics.

(This is not to say that you do not have valid points. There are just often hidden side effects I want to point out).