The end of lax monetary policy – Handelsblatt Morning Briefing

Anyone who trains for a marathon knows the word for reducing training immediately before the competition: “tapering”. The term is now making the rounds in the financial market, because it also means the throttling of expansionary monetary policy. Jerome Powell, head of the US Federal Reserve, stands out as the ultimate “tapering” tribune. It left the key interest rate in the low-level version of zero to 0.25 percent, but already promised an increase in interest rates for the coming year – not as before for 2023. Bond purchases are expected to cease by mid-2022, and are expected to be throttled this year.

The Fed is now assuming 4.2 percent inflation and only 5.9 percent growth in 2021. But Wall Street does not want to know anything about the “end or turn!” Of the lax monetary policy: the price losses are currently marginal. One waits for the realization, not for the announcement of the “tapering”.

In the Handelsblatt guest commentary, ex-EU commissioner Günther Oettinger agrees with the end of the terrible, glorious time of discount interest rates (bad for savers, wonderful for debtor states). He is reminiscent of Mario Draghi, once President of the European Central Bank (ECB), who bought the euro countries time with his “bazooka” of abundant supply of money, which they then often did not use convincingly – for reforms of the labor markets, better education or modernization, for example the administration.

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With a total indebtedness of the euro countries of 103 percent of the economic output, the domestic central banks would come under strong pressure to act in view of Powell’s policy.

It is doubtful whether the new “Dax 40” is so much better than the old “Dax 30”. After all, eleven values ​​contribute less than one percent to the total. What remains unchanged is that the “Big Four” of the auditing groups also have the larger stock market event under control.

At least the order has changed a bit. KPMG is no longer alone at the top. In 2016, the company had already represented exactly 58 percent of the companies present in the Dax today, but now it has 35 percent – just like PwC, which only reported 21 percent five years ago. The EY inspectors, embarrassed in the Wirecard scandal, manage 25 percent after 18 percent. After all, you stayed in business at Deutsche Bank. The smallest in the federal government, Deloitte, increased from three to five percent and should continue to benefit. The reason for the changed market shares is the rotation that is now required by law every ten years.

One of the classics of aphoristic art from the political center is an observation by Otto Graf Lambsdorff: “The Bundestag is sometimes full and sometimes empty, but always full of teachers.” Entrepreneurs are a rare species here, just 90 out of 709 members of parliament are self-employed. Given the occasion, we portray three young entrepreneurs who are pushing into parliament.

There are only a few entrepreneurs in the German Bundestag.

  • Verena Hubertz, 33, SPD, has won 21 million customers with its “Kitchen Stories” app and Bosch as the majority shareholder. When Frank-Walter Steinmeier was a candidate for chancellor in 2009, she earned 6.13 euros an hour at Burger-King and thought that the minimum wage was the right thing to do. After the SPD election flop at the time, she joined the party “out of frustration that we couldn’t get anything right”.
  • Michael King, 28, FDP, has a physiotherapy practice with 70 employees. He wants to help people to realize themselves, he justifies the alliance with the liberals. “I come from the middle of society, I know what it means to work a lot.”
  • Joe Chialo, 51, musician and founder of the music label “Airforce 1 Music Group”, competes for the CDU in the constituency of Spandau. In the Bundestag, the member of the future team of Union candidate Armin Laschet wants to represent the interests of independent musicians and other cultural workers: “I want to depict topics that do not take place in the Bundestag, but mean a lot to society.”

Kurt Tucholsky pointed out that experiences are not inherited: “Everyone has to do it alone”.

The murder of a gas station employee in Idar-Oberstein just for asking a customer to wear a mask still shocks the nation. In this context, Federal Interior Minister Horst Seehofer (CSU) regrets that he did not get away with important initiatives against extremism in the Bundestag – because his own Union thwarted him. In the “Süddeutsche Zeitung” he emphasized that he had long warned against brutalizing society: “We are seeing an increase here, whether in the left-wing extremist, right-wing extremist, Islamist or anti-Semitic area. But nobody has taken up that.”

A “defensive democracy” law, the attempt to delete the word “race” in the Basic Law and a tightening of the gun law have all failed.

Mark Twain is instructive here: “I definitely have no racial, class or religious prejudices. It is enough for me to know that someone is human – it couldn’t be worse. “

Frida Kalo’s picture “Diego y yo” is estimated at $ 30 million in the Sotheby`s auction house.

(Photo: AP)

And then there is the Mexican painter Frida Kahlo, who, 67 years after her death, managed to set price records for the Latin American art market with one picture. Her 1949 painting “Diego y yo” (“Diego and I”) is estimated at $ 30 million and is sold by the auction house Sotheby’s later that year.

Kahlo’s work beats the previous record for a Latin American artist – the $ 9.8 million that a picture of her husband Diego Rivera appropriately provided. She immortalized the painter in the picture that is now for sale. Auctioning your portrait honors the expansion of modern painting to include women artists, says Brooke Lampley of Sotheby’s. Frida Kahlo’s self-perception is even nicer: “I paint flowers so that they don’t die.”

I warmly greet you
you
Hans-Jürgen Jakobs
Senior editor

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