He warns of the growing danger of a global recession in an article in Handelsblatt American economist Kenneth Rogoff, speaking of a “perfect storm” that strikes Europe, China and the United States at the same time. “If the war in Ukraine escalates and Germany, which has so far strongly resisted the cessation of the Russian gas market, finally succumbs, a recession in Europe will be inevitable,” Rogov wrote. inflation in the United States. “Even without the war in Ukraine, the effects of the economic downturn in China and the United States would threaten growth, but the war greatly increased the risks and left Europe’s vulnerabilities unprotected.”
“Fortunately, the risk of a synchronized global recession will be reduced by the end of 2022, but at the moment the chances of a recession in Europe, the United States and China are significant and growing. And the collapse of an area increases the likelihood of the collapse of the rest. Record inflation does not ease the situation. “I’m not sure,” Rogoff concludes, “that politicians and decision – makers can meet the challenge they may soon face.”
Inflation, the Germans’ greatest fear
At the same time, McKinsey poll results show that Germany’s number one concern is inflation, with one in three fearing a deterioration in quality of life and the Bundesbank forecasting historically high inflation over five years. In fact, for many Germans, “estimated inflation” is higher than what is actually recorded in statistics.
THE Frankfurter Allgemeine Zeitung “Sees” the possibility of a vicious circle: “One risk when estimated inflation is high is the creation of a spiral of wage and tariff increases. If the prevailing view is that high inflation is not temporary, but will last longer and the Central Bank can not bring it under control quickly, more and more unions will start demanding higher increases as part of collective bargaining. hedge for inflation. “If the unions impose themselves and there are wage increases, which in itself is a major issue, then this may lead to a further rise in inflation.”
DW – Katerina Alexandridi
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