“Some problems may lie in store for us, but I don’t foresee a catastrophe,” said a woman I know, a business consultant in risk management. When I asked her to be specific, she referred to the Swedish banking crisis of the early 1990s. It was dealt with pretty successfully, she said, by measures similar to those now being put in place, though of course you can’t compare Sweden to the United States.
“This shouldn’t surprise you,” my octogenarian neighbor, formerly an exemplary comrade in East Germany and still a convinced socialist, smugly remarked. “It’s the great crisis inherent in the transition from monopoly capitalism to state monopoly capitalism; in other words, the final stage of your system. Under the Communists, kids learned about this process in grade school.”
Despite the dramatic headlines about the spreading financial crisis, and although it’s been clear for some time that the problem is no longer confined to the American real estate market, Germans are reacting to the situation with remarkable calm. I don’t know anyone who has thought seriously about taking his savings out of the bank and stashing them in the fridge. Unlike professional investors, savers are behaving quite rationally, perhaps because of the continual assertions from all sides that our economy, despite everything, is in fine shape and accordingly stocks will soon be climbing again, or maybe simply because no expert can offer advice that another expert won’t denounce as the worst possible approach.
Apart from perplexity, the most frequent reaction is sarcasm, which can be bitter or absurd, depending on one’s character and degree of exposure. Everyone who has eschewed risky so-called “financial products” feels something like schadenfreude, accompanied by a measured concern.
Television viewers accustomed to watching stockbrokers in action on their screens have long suspected that these are people with severe personality disorders, people who exercise their crude mixture of special talent and gambling compulsion in a morality-free zone and couldn’t care less about the consequences for the rest of the world. The idea that such people may soon find themselves, if not in prison, then at least in a soup kitchen provides satisfaction to many a German who in recent years has had to bear the contempt of clever financial advisers looking down upon him as a timorous fool for passing up the chance to let his money really work for him.
I felt a certain uneasiness last week when Chancellor Angela Merkel and her finance minister, Peer Steinbrück, stood before the cameras and announced that the state would guarantee all the nation’s savings accounts, an amount estimated to be at least 1.6 trillion euros. That they considered it necessary to talk the citizenry out of being worried suggested for the first time that there were, in reality, grounds for even greater worries.
I briefly considered whether, with winter coming on, there might still be some possibility of acquiring a piece of land, complete with potatoes and cows, near Berlin. I quickly realized, however, that I know even less about farming than I do about financial markets and concluded that I had better steer clear of both.
I asked my friend the business consultant what she thought about investing in gold, which — although it lacks any practical nutritive value — has been for millenniums a most desirable commodity; she rolled her eyes at my naïveté and explained that the gold market was highly speculative right now: as soon as confidence in businesses and securities returns, she said, people will dump gold by the ton and the price will be cut in half.
Nonetheless, I confess that I’ve been secretly thinking about converting at least a portion of my next royalties, assuming there are any, into gold coins and stuffing them into a pretty leather bag, like the one Pippi Longstocking keeps in her big wooden chest. That way, at least, when the looming (even though nobody can tell you exactly what it’s going to look like) catastrophe arrives, I’ll still have something to swap for candy for my daughter.
Christoph Peters, the author of the novel The Fabric of Night. This article was translated by John Cullen from the German.