After 90 Years, German Inflation Angst Is Fading

摘要

When Walter Baltes was five, he thought money always came in bundles of bank notes like those his grandmother hauled to the bakery to buy bread. It was 1923, in the town of Witten in Germany's industrial heartland, and the Reichsbank was printing marks nonstop to pay reparations from World War I. "I am very careful with money, which probably has something to do with my experience," says Baltes, 95. His frugality notwithstanding, he says these days he sees "absolutely no risk of inflation." Ninety years after a generation's savings were wiped out, Germany's inflation angst, the driving force of its postwar economic policy, has eased. That may allow Chancellor Angela Merkel to focus less on price stability and more on leading the recovery in Europe. At the height of the euro crisis, Germany extended aid to Greece, but on tough terms, for fear of angering inflation-phobic voters. "It makes it easier for Merkel to agree to debt relief for Greece," says Sebastian Dullien, a senior policy fellow at the European Council on Foreign Relations.