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Washington’s Great Interest Rate Oracle – Handelsblatt Morning Briefing

You can also overdo it with expectation management. There is probably no one left in the USA who, given seven percent inflation, does not expect interest rates to rise. But the Federal Reserve (Fed) has again not lifted the basement level from 0.00 to 0.25 percent, it only prophesies: It will “soon be appropriate” to raise the key interest rate. The bond-buying program launched during the pandemic will continue to be scaled back by $30 billion a month, dropping to zero in early March.

In view of such signals, financial industry astrologers are sure that the key interest rate will rise at the next meeting on March 16. In the press conference, Fed Chairman Jerome Powell did not even rule out the possibility of interest rate hikes at each of the seven central bank meetings scheduled for 2022. Then the stock prices plummeted. So many policy whiplashes could end up causing investors to flee.

The new nervousness also affects a stock market boom phenomenon of the previous year: those empty company shells with which one – hocus pocus fidibus – also accommodated alarmingly anemic candidates on the price list. In our cover story we describe like this January only 24 of these investment vehicles called “Spacs” (Special Purpose Acquisition Companies) went public. In January 2021 it was 92.

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The issuance volume shrank from $24.5 billion to $5 billion. Finally, the weak price performance of German Spac creations such as Signa Sports or Hometogo also points to a shakeout.

Sympathizers of the CDU – they are said to still exist – can now read in a broad analysis paper how the party is doing. This is where what everyone sees externally is formulated internally. The Union is “no longer credible and authentic” in a number of policy areas, it says, the programmatic core of the brand has been “polished”, and there is “a lot of catching up to do” on relevant topics.

Sure, there is a chance of resurgence, but also the risk of an “implosion along the lines of other Christian Democratic parties in Europe,” quotes the “Frankfurter Allgemeine”. Greetings from Italy. There is talk of an “alienation between the party leadership and large parts of the membership”, even the high “C” is discussed. The CDU, which is currently unable to campaign, looks as if it was frozen in 1998.

Germany will deliver 5000 military helmets to Ukraine. A joke, thinks Kiev’s mayor Vitali Klitschko.

The announced delivery of 5,000 soldiers’ helmets from Germany to Ukraine can be considered a “joke”, as Kiev Mayor Vitali Klitschko said. However, one can also ask whether weapons are really the biggest problem for a nation of armaments that, with its Ukroboronprom group, can compete with militarized Russia or other Eastern European countries in submarkets.

Meanwhile, NATO and the US have responded in writing to Russia’s demands that they kindly stay out of Moscow’s backyard. They refused any guarantees but offered better relationships with more communication and transparency. “We are ready,” the NATO letter reads, “to listen to Russia’s concerns and to have a real discussion about how to protect the fundamental principles of European security.” […] preserve and strengthen”. So far, Russian worries had been sent into the realm of myth-making.

Mark Zuckerberg did what an individual can only do in James Bond films: He threw governments and central banks into turmoil. The reason was his Facebook group’s own cryptocurrency project, which is now called Meta Platforms in the style of the promised virtual future. But Zuckerberg’s desired currency Diem, previously Libra, apparently dies an unnatural death, even if it should be tied to a fixed real currency basket as a stablecoin. However, according to a Bloomberg report, the Diem Association will disband, sell its assets and funnel capital back to investors including Andreessen Horowitz, Uber, Lyft and Spotify. Apparently, the Zuckerberg money failed due to growing political resistance to digital monopolists. Conclusion: Libra means scales, but nothing is balanced here anymore.

Carlo Bertazzo in front of a Volocopter drone in Rome: The Atlantia boss wants to be involved again in the next financing round and increase the share.

The “Smart City” is the big trend at German congresses. You have to think for a moment why a key company in this business was sold from Germany to Italy for 950 million euros: Yunex Traffic. The Benetton sweater dynasty acquired the ex-Siemens company. Her offshoot Atlantia is already painting the most beautiful growth curves.

Numerous cities such as London or Milan demand congestion charges, and many more will follow, says CEO Carlo Bertazzo in the Handelsblatt. This requires a system of sensors, cameras, number plate recognition and good software – “Yunex does all of that”. Atlantia also relies on drones and air taxis and has joined the German start-up Volocopter for this purpose. According to Bertazzo, the proportion will soon be increased. He has a lot of money in the coffers because his own freeway concessions are being renationalized. An Atlantia company had botched the maintenance of the Ponte Morandi motorway bridge near Genoa. It collapsed, 43 people died.

And then there are edible insects as a new market hit, at least in Japan. The country sees itself as an innovator here. In fact, Japanese venture capital firms are currently investing a lot of money in start-ups that are trying out cricket ice cream, pickled bee larvae or tea made from silkworms. Fried cockroaches are also served, describes our correspondent Martin Kölling. As early as 2013, the UN’s Food and Agriculture Organization hailed insects as an alternative source of “food and fodder,” and high-emission livestock farming is fueling the trend.

When CDU returnee Friedrich Merz recently invited journalists to his new old Bundestag office, his press spokesman also offered grilled grasshoppers. But that wasn’t a food trend, but a joking reference to the master’s past in the financial industry.

I wish you an eventful day, it doesn’t always have to be caviar.

It greets you cordially

Her

Hans Jürgen Jakobs

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