"I feel fit and ready for the game with Italy," remarked a relaxed Bastian Schweinsteiger to the assembled press ahead of Germany's Euro 2012 semi-final with Italy in Warsaw. And it wasn't just Bayern Munich's Fussballgott that was in confident mood going into the game. The excitement among the rest of the squad was palpable, and so it should have been. The team had eased through the so-called 'Group of Death' with maximum points and had just dispatched Greece 4-2 in their quarter-final, a scoreline that had flattered the 2004 winners.

Italy's route to the semi-final had not been unimpressive, but they certainly hadn't matched the free-flowing football that Joachim Löw's swashbuckling side had produced. With Italy having had two fewer days to prepare for the game and Germany being in such impressive form, the whole of Germany, it seemed, was ready to see their team exorcise the demons of 2006 and book a rematch with Spain, their conquerors in the previous two major tournaments. But to the dismay and dejection of millions, mistakes, questionable team selection and a very plucky Italy side combined to bring Germany's Euro 2012 campaign to a sudden halt, and inflict at least another two years of hurt in the quest for a first major trophy win since 1996.

The German juggernaut had been gathering momentum since Spain's Carles Puyol's header eliminated them in the 2010 World Cup semi-final in South Africa. Qualification for the European Championships in Poland and Ukraine had been achieved effortlessly courtesy of ten straight victories and a 100% record. Despite being drawn in the toughest group - with Portugal, Holland and Denmark - Löw's men swatted away the competition for the tag of 'Spain's closest challenger' with three comprehensive performances. Satisfying wins over Portugal and Holland arrived with three goals from Mario Gomez, who looked to be in the mood, while the plucky Danes were seen off thanks to a winning goal from ex-1860 Munich starlet Lars Bender, another example of a talented young German excelling at the highest level.

The quarter-final victory over Greece provided yet further evidence that Germany were the team to beat. Granted, the opposition was probably the weakest of all the teams in the last eight, but it was a performance full of flair and invention that saw some players visibly improving at precisely the right stage of the tournament. Löw made a calculated gamble by changing his entire front three, dropping Gomez, Lukas Podolski and Thomas Müller and bringing in Miroslav Klose, André Schürrle and Marco Reus. And it was a gamble that paid dividends. The movement of his team, particularly in attack, was something more akin to what fans had been treated to in the qualifiers and even in the World Cup. Mesut Özil had his best game of the tournament - Klose having brought out the best in him - and Sami Khedira also excelled, capping a superb individual display with a fine goal. Reus and Klose also scored, with the former in particular looking every inch a German international, topping off a superb display with a crashing volley in off the bar.

With the team in such vibrant form, and with Italy taken to extra time and penalties by England two days after the victory over Greece, Germany had had the best possible preparation for the clash with perennial rivals Italy.

Sadly, the effectiveness of that preparation was damaged by one particular change to the team, a decision that may haunt national team coach Löw for the remainder of his tenure. Gomez and Podolski were both restored to the starting line-up, which was somewhat surprising considering the performances of Schürrle and Klose against Greece. But the biggest shock was undoubtedly on the right side of midfield. Instead of recalling Müller, Löw started Toni Kroos, a man who had played just 22 minutes of football in the entire tournament. Having seen how Italy's midfield - especially Andrea Pirlo - had dominated possession against England, the thinking behind Löw's plan was to introduce a player more adept at keeping possession and matching the Italian midfield, as opposed to Müller, who can be somewhat erratic and unpredictable in his positioning and use of the ball. Ultimately, it proved a poor miscalculation by the manager and one for which Germany would pay a heavy penalty. Kroos began on the right of midfield but frequently alternated with Özil, with both of them drifting all over the pitch. When Italy won control of the ball, the two of them seemed unsure which should press and which should hold. Jerome Boateng was left isolated at right-back and Italy took full advantage of Germany's uncertainty. Pirlo pulled the strings in midfield and the enigmatic two-goal striker Mario Balotelli had, in his view, the best game of his life.

Collectively and individually, Germany did not perform, which brings us back to Schweinsteiger, who was perhaps being the best example of that. Throughout the tournament he looked worlds apart from the lung-busting dynamo we saw in 2010, both in his form and his demeanour on the pitch. Barring two assists against the Dutch, he simply looked out of his depth in Germany's midfield and was completely outshone by his partner Khedira, whose performances were one of the few pluses for Löw. There are most definitely extenuating circumstances with Schweinsteiger that affected his form and preparation. One thinks of the numerous injury niggles he has sustained this season, not to mention his fragile mental state after missing the crucial penalty kick in the Champions League final against Chelsea on home soil in May. But for a man of his stature and experience, the performances he turned in were woeful and Euro 2012 was a personal disaster for him. It was solely down to his reputation that he retained his place in all five games. Indeed, Löw would have been better served dropping him for Kroos instead of Müller.

A note of caution had been sounded after the Greece game, where two sloppy goals had been conceded against very limited opposition. But that warning, however much Löw and his players may have acknowledged it, barely registered in the minds of German fans. Whereas four years ago there was a vain hope that the Germans would win the Euros, this time it was expected.

Löw did not entertain any suggestion that his players had become complacent, however. Instead, he attributed the defeat to poor mistakes made at crucial times, with a veiled acceptance of his side's mental shortcomings. "We had things under control at the start, but once we fell behind we started taking more risks and lost our organisation." He took the blame for the defeat on himself, neglecting to mention the decision to play Kroos from the start. It was not complacency from Germany's players that proved their undoing but a lack of toughness and experience at the business end of a tournament. Having not trailed in a competitive game since the semi-final two years ago, a young squad were at the mercy of an experienced Italian side, and, at 2-0 down, there was no way back.

Germany were - and still are - a very good football team. There is competition for every position and this is one of the strongest, most talented squads that Germany has ever had. There is an assembly line of talented, young players coming through, many of whom impressed at these championships. The reality was that Germany were not ready to win the Euros this year. With an average age of 24.52, theirs was the youngest squad at the tournament and they showed their inexperience. Once they fell two goals behind to Italy, there was no formative plan of action to get them back into the game. In the second half, the order of the day was a hopelessly high defensive line and all-out attack, which left gaping holes in defence. But the defeat, however painful, is the type of character-building experience that the squad needed. What is certain is the young players who were given a taste of competitive tournament football, and impressed - the likes of Reus, Schürrle, Bender and Mats Hummels - will learn from this experience. "We saw that perhaps the team hasn't quite fully matured on the pitch yet, but this is an extremely ambitious group of players and I don't anticipate the disappointment staying with them for too long," remarked a defiant Löw. Indeed, the sight of Hummels and Badstuber sitting on the bench discussing what went wrong in the moments after the final whistle is a sure sign that not only can this group of players acknowledge their misgivings, they will also work on rectifying them.

The more experienced players in the squad, such as Podolski, Schweinsteiger, Klose and Philipp Lahm, will most probably retain their places in the squad for the 2014 World Cup, with the possible exception of Klose, now 34. But the other three will be pushing 30 then, still young when compared to the likes of Spain's Xavi and the Italian maestro Pirlo. Jogi Löw, for whom this has been as big a learning curve as it has for anyone connected to Germany, is highly likely to still be in the dugout.

There have been other teams that have gone down in the history books as some of the best that the game of football has ever seen, but who didn't get their just rewards in terms of trophies; one thinks of the Dutch 'Total Football' side of the 1970s or the Zico-inspired Brazil of the 1980s. The current crop of stars, at least in terms of sides that Germany has produced down the years, certainly fits that bill. But they have the severe obstacle of competing with Spain, arguably the greatest team in history after their third major tournament success in a row. Euro 2012 showed that not just Germany but the rest of Europe lags a long way behind the Spanish at the summit of the European game. We can only wait and see if history repeats itself with this immensely gifted group of German players.