Three reasons to be confident
Tuesday, 10 January 2023
Hello from Germany,
We all have a cognitive bias toward bad news. It's in our nature. It keeps us alert and alive.
That's why newscasts are mainly about bad events. Wars, natural disasters, accidents. The train wreck makes the news. The overwhelming majority of accident-free trips are not newsworthy.
In a world where suffering, destruction and negativity can land on our mobile phones at any minute, the human trait of negative attention becomes our undoing.
We should counter the glut of negative news with more positive ones.
Let’s start today. Here are three good economic news about Germany.
First, never before have more people been employed in Germany. In 2022 it was 45.6 million people, up 589,000 from the previous year.
Second, Germany is probably leaving the inflation peak behind. Inflation was at 8.6 per cent year-on-year in December, down from 10 per cent in November. For 2023 German inflation is expected to come in at around 6 per cent.
Third, even with the war in Ukraine and occasional energy shortages in combination with high prices German economy might grow slightly in 2023.
So the prospects have improved significantly in recent weeks.
This is mainly because Germany broke away from Russian gas and oil faster and with less serious consequences than expected.
The reasons are a clever and fast-acting government in connection with a market economy that is systemically quick to adapt.
So there is good reason to hope for a happy and successful 2023!
The Strolling Economist
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