Defying fear

The Dax has rushed from high to high this week. At first glance, there is no longer any sign of fear of inflation. But the financial markets are still caught in the tension between growth hope and fear of inflation.

Hope triumphs: The

AThis Friday is March 12th. The Dax will fall by 12 percent and thus experience the second worst day in its history … Shit! – Wrong year, that was 2020. So again: The Dax again reached an all-time high on Thursday – the ninth since the end of December, and maybe the tenth could come on Friday. This week the US Congress passed the economic stimulus package of almost two trillion dollars and the associated hope for growth impetus. But that was not particularly surprising, even if there had been massive political cross-cuts at the beginning of the year. In January and February, however, after the all-time highs, there was always a significant downward trend. That is different now: The price increase this week is much stronger so far and a consolidation is not in sight.

What has changed? Which fears are gone? Well, fear is especially strong when it’s dark. Then monsters lurk in closets and under beds and something moves in the dark. If someone then switches on the light, one is willing to laugh at the fear that was previously felt so strongly. The monster under the investor’s bed recently was inflation. Many worried that this would increase significantly in the course of the recovery from the Corona recession. It wasn’t exactly clear where the problem might actually be.