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Posted at 9:41am on Feb. 15, 2008 A Ghost From the Past Rises in Germany
Inflation Heats Up
By blackhedd
Think back to 1923, when Germany was struggling to pay reparations to the Allied nations under the terms of the Treaty of Versailles. Germany's bankers decided to pay off the notes in funny money, and triggered one of history's classic hyperinflationary episodes.
The specter of high inflation is on many minds these days. Where else but Germany, however, can you interview a normal middle-class woman, and be told the following?
"Average households have to reach deeper and deeper in their pockets. It almost triggers existential fears."
What's the obvious thing to do in a country where labor unions are enshrined as nearly a full partner in business management and government? You start talking about "mega" wage increases and "social justice." And that possibility is exactly where the real existential fears should be coming from.
And this only tightens the box that the European Central Bank (ECB) and its chairman, Jean-Claude Trichet, are stuck in.
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