Gegenstandpunkt 3-21

Not all inflation is the same

Inflation is part of the market economy. Everyone knows that. As well as what it means for everyone who has to earn a wage in order to provide for their living expenses by paying the consumer prices that are charged. Their buying power is steadily eroded by the general phenomenon of general inflation: These people are getting poorer and poorer – a universally accepted automatism of the market economy which is included in its price, so to speak.

In addition – and this may not be known to everyone, nor does it have to be, but is known to economic experts, and that’s what counts – inflation has a completely different, much greater significance. It’s a datum.

Because,

if, as one hears, inflationary dynamics are now picking up speed again, the question arises as to whether this development will prove to be a temporary phenomenon, although this is gainsaid by the fact that the prices for raw materials in particular are rising sharply and international supply chains are facing interruptions, or whether this is precisely the reason inflation will get out of control over the long term, even if this fear is globally counteracted by the still considerable production capacities of the entire global economy;

if meanwhile it is unclear how the monetary guardians will react when their respective inflation targets are exceeded – will a loose monetary policy and bond-buying programs remain in place or will interest rates rise, thus worsening financing options for companies, which would naturally dampen the mood on the stock exchange, not to mention the prospect of impending corporate bankruptcies?

if market trends are already emerging in which market participants move into rock-solid real assets such as real estate, infrastructure, art, and farmland in anticipation of an impending worsening of inflation or even just out of their own personal inflation fears or those of their peers;

if the connection between the vaccination rate, the level of the gross domestic product, and the risk of inflation is still left open in all this ...

... then all this is without any doubt to be taken into account, weighed up, and practically calculated by those who use money not for shopping but for investing, who are therefore notoriously searching for clues that motivate them to buy, hold, or sell all the beautiful securitized claims to value traded on the stock exchanges of this world by those who, through the practice of their speculation, create and destroy the real existing fictitious capitalist wealth on which, as is well known, so much, if not everything, depends.

It is therefore perfectly ok in terms of the free market economy that the really relevant, i.e. true, significance of inflation is one and the same as their inflation worries, as is the journalistic need of certain circles to present these worries to a wider audience for sympathy on the relevant pages of the serious press and before the daily news.

And in this context, it is also perfectly ok that those who have to pay more and more in a banal way at the checkout counter are in the end bestowed the honorable status of a consumption datum to be added up.