Europe is revolving around itself. And that is only understandable given the major risks: the war in Ukraine, dependence on Russian energy supplies and record inflation.
“Something is changing very fundamentally here,” our China correspondent Dana Heide reported to me when I called her in Beijing. Within a few weeks, the mood had changed completely, many just looked in bewilderment at the economic key figures.
At least as stunned many looked to Shanghai. The metropolis, which was once liberal by Chinese standards, has been in lockdown for weeks. People disappear into hospitals for weeks, children are separated from their parents and hundreds of freighters are stuck off the coast and unable to land.
Western expats, my colleague reports, just want to get out. The problem: If they even get a seat on one of the few planes, receive a special travel permit and are allowed to leave their apartment for the trip, there is still no driver to take them to the airport because they are not allowed to leave their houses either .
At the same time, the situation in Beijing is getting worse, reports Heide. Another block of flats in their neighborhood has just been completely closed. Some friends and colleagues have not been allowed to leave their homes for days.
While many of their western contacts have now left the country, Heide was still traveling through China until a few weeks ago. Now she too is staying in Beijing. From there she will continue to monitor the situation together with her colleague Sabine Gusbeth, because several important figures on the state of the Chinese economy will be released in the next few days. Then we will get a first indication of how deep the crisis in China’s economic model really is.
One thing is clear: China is currently experiencing a fundamental change. So far, the focus has been on the economy, the growing prosperity of a large part of the population. Now it is increasingly about national security. This is bad news for Europe and European companies.
What else kept us busy this week:
1. Research by my colleague Moritz Koch had shown it a week ago: the EU would speak out in favor of an oil embargo against Russia, he wrote – and that’s what happened. The step is “just as legitimate as it is necessary,” says Handelsblatt opinion leader Jens Münchrath. However, the EU missed the crucial prerequisites for a lasting sanctions effect: “The boycott is so poorly made that one should rather speak of a sham embargo,” writes Münchrath. According to Münchrath, this could ultimately lead to the “warlord in the Kremlin emerging as the short-term winner of the boycotts.”
2. Russian media or government representatives are increasingly threatening to use nuclear weapons. Handelsblatt Russia expert Mathias Brüggmann spoke to numerous experts about one question in particular: How far will Vladimir Putin go? And in another text he analyzed with colleagues what options he still had. The answer: “Putin has only bad options left”.
3. The European rescue fund ESM is about to undergo a total restructuring, our Berlin office found out a few days ago. You remember: This is the institution that was supposed to help troubled countries through the euro crisis. Now the economists of the ESM are planning nothing less than a reorganization of the financial architecture of the euro currency area. The ESM wants to set up a new rescue package worth 250 billion euros. “We’re going to save ourselves to death,” my colleague Martin Greive aptly comments on the plan.
4. For a long time, the ECB reacted to inflation with salami tactics. First the bankers appeased for months. And when people had long since felt the rising prices, the central bankers reacted with tiny communicative steps. Now comes the realization: “Now it’s not enough to talk, we have to act,” said ECB Director Isabel Schnabel in an interview with the Handelsblatt: “From today’s perspective, I think a turnaround in interest rates in July is possible.” coming late.
5. There are signs of a clear turnaround on the housing market, the latest figures show: For the first time in years, prices will stagnate – or even fall. By the way: The city with the greatest increase in value is not Munich, but Potsdam. But see for yourself:
6. As Helmut Gottschalk, his position as chief controller of Commerzbank took office, many derided him as a man from the provinces. It’s over. But the 70-year-old polarizes all the more: Some see him as the right person to ensure more down-to-earthness in Frankfurt’s Commerzbank Tower. The others see him as a man of yesteryear who interferes too much and pushes the “people’s bankization of Commerzbank” with small-minded guidelines. In an extensively researched portrait, Andreas Kröner not only describes what is really behind these allegations. With a lot of insider information, he also paints a picture of the internal state of the bank, in which many major global banks still want to play.
7. How the Ukraine war redistributed wealth and power around the world, explains a team of Handelsblatt authors headed by Christian Rickens this week in our big weekend title – and that brings us full circle to the beginning: because the change in China’s role is also evident here: the country is just as important as a trading partner for Germany like the US. 45 percent of all German motor vehicle exports go east.
8. Private equity funds have been generating attractive returns for years, even in times of crisis. Although private investors cannot invest directly in these funds, it is still possible to do so via a detour. And that can definitely be worth it.
9. One of the nicest parts of my job is es that I can always exchange ideas with entrepreneurs. People who think the unthinkable and make the impossible possible. One topic has come up particularly often over the past few months: the dream of eternal life – and the will to make this dream come true. Our New York office has compiled what the international tech elite is currently working on: A start-up founder from Arizona, for example, freezes corpses so that they can be woken up again later. The treatment costs $200,000. If that’s too extreme for you, you can have the blood of younger people injected – or regenerate stem cells using gene scissors. All in the hope of eternal youth, of course.
I wish you a relaxing weekend
It greets you cordially
Yours Sebastian Matthes
Editor-in-Chief of the Handelsblatt
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