Inflation picks up speed when you talk about it

The Germans are considered inflation phobics. Just as mass unemployment burned itself into people’s collective memories in the USA in the 1930s, the hyperinflation of the early 1920s became a collective trauma for Germans.

Even today, the Americans fear that mass unemployment will become entrenched, even on insignificant occasions, while the Germans suspect that every sharp rise in prices is the harbinger of hyperinflation, as the then US Treasury Secretary James Baker used to say more than 30 years ago.

In the past decade, this religious dispute was often fought out in the Council of the European Central Bank (ECB) between former ECB President Mario Draghi, who was influenced by US ideas, and Jens Weidmann, then President of the Bundesbank.