In the current phase of extreme imbalances, it seems logical that politicians should do what they always do: more or less the same, but never really enough.

When I was young I was in a pretty bad car accident. I got out of a completely battered Citroën 2CV unharmed, but overwhelmed by what was happening, I was in shock. And I passed out. I will never forget that feeling of losing my balance and collapsing. It’s not called balance for nothing. By that we mean that something is in balance, and in economics in particular balance is incredibly important, far too important in my opinion. It’s all about balance. Households or companies are looking for a balance that best suits their needs, in line with budget constraints. At the macroeconomic level, we speak of equilibrium price or equilibrium quantity, of a balanced interest rate, and in our studies we have taken the trouble to calculate the equilibrium of an economy. There are many other equilibria in economics, from Walras to Nash and all the others.

On the other hand, it is a fact that there is never an equilibrium in practice, much less in economics. This rule, which once found some justification in economics textbooks, is now a thing of the past. There is simply no state of society or economy that can be described as stable. Once we understand this, we can see the reason for these imbalances. The financial markets are THE home par excellence of this instability. They are never balanced, not even a little bit. There, information is constantly being processed, reassessed every day, and the next day everything is completely different from the day before. As for the omniscient market, it ignores where the journey is leading day after day. The feeling that our existence is becoming more and more transient can also be explained by the dominance of the financial system, which has experienced much stronger growth than the real economy over the past thirty years and which is constantly spreading turbulence, escalating in the media. This excitement is also affecting our daily lives, hundreds of times through the digital madness. For many people today it is more important to be present everywhere, to be informed about everything, not to miss a trend and to always have your finger on the pulse than to find a balance that they could lose with this constant inclination. Everyone seeks their balance because everything else is too uncertain, undoubtedly too unstable.

I never met the perfect state of balance that I was taught in college. How would it look? Growth by what percentage? And how high could inflation or interest rates rise? The complexity of the real evolution of economics undermines all models, whose shameless oversimplification of reality is a joke that only interests a few students at best. At times I felt that certain imbalances or shifts were foreseeable, but now that my working life is drawing to a close, I have to admit that the economy is even more unpredictable than one might imagine. We currently appear to be going through a period of extreme imbalances. Post-(?)pandemic, delivery problems, war in Ukraine, rising inflation and probable recession keep us in suspense and no textbook explains these scenarios. So it seems logical that politicians do what they always do: more or less the same, but never quite enough. She had announced that inflation could spiral out of control, but the monetary authorities hesitated too much and now face a catastrophic situation. This imbalance was felt upstream and did not occur overnight. Blaming oil and gas alone is easy, but it’s not holding up, especially now that prices are rising across the board. Like in the textbooks, where the balance is lost.


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