The corona pandemic also had the world firmly under control in 2021. But vaccines developed at a rapid pace raise hopes for a normalization of life. The crisis is doing less harm to the economy than expected, thanks in part to extensive government aid. The stock markets were booming, and at the same time inflation rose faster than it has been in a long time. And the climate crisis came back into focus.
736 members of parliament sit in the 20th German Bundestag – more than in any previous one. The reason for this is the compensation mandates introduced before the 2013 election. If a party receives more direct mandates through first votes than it can fill with second votes, all direct candidates still move into the Bundestag. The other parties receive compensatory mandates accordingly, so that the proportion of members of parliament as a whole corresponds to that of the votes.
That is expensive: in 2020 the costs for the German Bundestag, with only 709 elected representatives at the time, totaled more than one billion euros. Actually, only 598 men and women should sit in parliament.
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SPD: Weak election result, but Olaf Scholz becomes chancellor
The SPD received 25.7 percent of the second vote in September 2021 – more than any other party, but less than a party that later appointed the Federal Chancellor. Nevertheless, Olaf Scholz was elected on December 9th with 395 of the 736 votes of the parliamentarians. He received 303 votes against, six members abstained and three votes were invalid.
The election was made possible because the SPD entered into a coalition with the Greens (election result: 14.8 percent) and the FDP (11.5 percent). The coalition has 416 members in the German Bundestag and the opposition has 320.
Debt: The pandemic is weighing on public finances
The debt of the German state will probably reach a record level of 2.5 trillion euros in 2021. An important reason for the increase: since the beginning of the pandemic in 2020, the state has pumped 125 billion euros into the economy; In addition, there are 40 billion euros in short-time work benefits. Compared to 2020, liabilities increase by 220 billion euros. In 2020, the national debt rose sharply due to the corona: by 268 billion euros. The pandemic has ended a period of debt settlement that began in 2013.
Carbon dioxide: no breathing space
The emission of long-lived greenhouse gases temporarily decreased slightly due to the pandemic in 2020, but their concentration in the atmosphere continues to rise. The weather and oceanography authority NOAA reported a global average of 419 CO2 molecules per million molecules of dry air (ppm) for May 2021. That corresponds to almost 150 percent of the pre-industrial level.
For 2020 the World Meteorological Organization (WMO) had determined a value of 413.2 molecules, the increase compared to 2019 (410.7 ppm) was greater than the average for the years 2011 to 2020.
Equity markets: sentiment continues to be good
The continued loose monetary policy of the central banks, the lack of a corona crash and the pandemic aid for the economy and the population have ensured that the mood on the stock markets has not deteriorated. If the central banks tighten their monetary policy significantly over the next few months as announced and raise key interest rates, that could change.
Price shock: Corona drives inflation
Delivery bottlenecks, high prices for energy and raw materials, help to cushion the corona crisis – all of this has led to a noticeable rise in inflation. In Germany, prices rose by 5.2 percent in November compared to the same month last year, the last time they were in 1992. A special feature in Germany: In the second half of 2020, a lower value added tax was applied as part of the Corona relief measures; Prices appear higher
In the United States, inflation reached 6.8 percent in November, the last time it was so high in March 1982. Many economists now reckon that inflation will remain high for longer because wages could also rise soon.
Stock market favorites: Bitcoin, long-running favorite Tesla
When it comes to Bitcoin, investors have to have strong nerves: Amid great fluctuations, the largest cryptocurrency reached its all-time high of $ 67,735 per Bitcoin this year. Then it went down again. Nevertheless, after twelve months there was an increase of 63 percent. Some analysts believe the value will jump over the 100,000 mark in 2022.
The share of the US electric car pioneer Tesla is also one of the favorites of investors, it climbed to just under $ 1,230 – not least thanks to the cult status of company boss Elon Musk. More recently, however, the paper has suffered from Musk selling off large blocks of shares. The sales were foreseeable: Musk had his followers vote on Twitter whether he should sell shares in order to be subject to income tax. Because as long as an investor does not sell shares, there are no taxes on the price gains – this also applies to billionaires.
The majority of Twitter users voted for the sale. By December 29, Musk had sold around 15.6 million shares, or a good nine percent of its shares, for around 16.4 billion dollars, according to the Bloomberg news agency. If he wants to sell ten percent as announced, he would have to come to around 17 million shares.
Raw materials: the energy transition is driving up prices
An unexpectedly good global economy and the acceleration of the energy transition in Europe have pushed raw material prices to record highs. Metals such as copper and nickel, which are important for battery cells, increased significantly. For energy resources such as oil and gas, empty storage facilities, the dispute over the Nord Stream 2 pipeline, the conflict over the Iranian nuclear program and uncertainties about the behavior of Opec plus all had an impact on prices.
DAX companies: Business is going well
Despite a shortage of chips, delivery bottlenecks and rising prices: The Dax companies will probably earn more than ever in 2021. Analysts expect a net result of the 40 companies of together almost 114 billion euros, more than twice as much as in 2020. The shareholders will also benefit from this, the corporations should pay out 45.5 billion euros according to Handelsblatt calculations – a quarter more than in the previous year.
Covid-19 vaccine: rapid development
The Sars-CoV-2 virus appeared for the first time two years ago in China. Just a year later, scientists had finished developing the first vaccines, and approval came in record time. In March, vaccinations started on a large scale worldwide. By Christmas, almost 4.5 billion people had received the first vaccination, around 3.8 billion had been fully vaccinated and 450 million had been boosted.
Biontech: The willingness to take risks pays off
Since 2008, scientists at the Mainz-based biotech company Biontech have been researching active immunotherapies for the treatment of cancer and other serious diseases. But the economic success came from a completely new application of mRNA technology: the development of a new type of vaccine against the Sars-CoV-2 virus. In the third quarter of 2020, the bottom line was a three-digit million loss, in the quarter after that the same profit, and in 2021 each quarter has ended with a billion profit.
Electricity price: energy becomes a cost factor
Cold winters, empty gas storage facilities, little energy from wind power and the sun, rising prices for fossil raw materials and a flourishing global economy have caused electricity prices to rise sharply. On the EEX energy exchange, the price for one megawatt hour of electricity rose by almost 400 percent over the course of the year. Politically, the increase is in some cases even desirable: higher electricity prices are likely to drive the development of new technologies for an energy turnaround.
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