For each bolded word in the poem, count forward a number of words equal to the number of letters in the word. The word you reach is italicized, and is the German translation of the bolded word. So the fourth word after "With" is "mit," the German word for "with."
The blank line is six words after bolded "nearly" and four words before italicized "fasten." The German for English "nearly," and the English for German "fasten," is "FAST" which is the answer.
Here is a list of translations, though you only needed to get the idea to fill in the blank, not solve every translation.
Author's Note 1: This was a fun puzzle to brainstorm for. I was living in Germany at the time, and noticed that many German words looked like English words. I sat down with my German roommates and by the time dinner was over we had a list 70 long much to our mutual surprise. Thanks to Bridget for helping me find a way to make it into a puzzle that didn't depend too much on being able to find every translation.
Author's Note 2: Dear solver Arthur: this puzzle was not meant to indicate that you should give up solving. Thanks for sharing your story with us at wrap up.
Solution added in 2010 by the archivists of Beginner's Luck, and updated with additional information from Ken Jacobs. Thanks to Lance Nathan for providing the solution.