If there was one thing that wasn’t lacking in the past few years, it was money. This sentence may not apply to every citizen personally, but it describes western societies in general.

That was quite comfortable: A pandemic that could send the economy into a crisis of unprecedented proportions? No problem – politicians simply set up aid programs worth billions and rescue companies through the crisis. Does the state need investments for climate change? No problem – thanks to negative interest, new debts even make a profit in the end.

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The loose-fitting money also helped on a smaller scale. A start-up has a bold business idea? No problem – the money was so open with the venture capitalists that practically any founder could try their hand at a new company. Real estate prices are skyrocketing? No problem – thanks to the low interest rates, the bank finances sums that only millionaires would have received in the past.

With the interest rate turnaround announced by the European Central Bank, this is now over. Politicians will no longer be able to iron out every crisis, investments will become rarer and start-ups and real estate buyers will no longer find money so easily. Thus, the new monetary policy of the ECB is also a farewell to a carefree way of life. But the absurdity of the opening sentence already shows that this is sorely needed.

Because inflation makes it clear that the ECB has overdone it with its expansive monetary policy. In order to save the southern European countries first and later to cushion the corona crisis, the low interest rates were helpful; they were probably the only way to get the economy through the crises under these circumstances without a real crash.

But in the meantime so many economic upheavals are accumulating that the ECB has to think about its only task: currency stability. Setting growth impulses is not their responsibility. Politicians have to do that – under the monetary policy conditions that the central banks set.

While higher interest rates won’t bring down the prices of items that are simply scarce on the world market in the short run, they do help heal market distortions left after years of easy money. The high salaries beyond any competition in many tech companies in the USA would hardly be possible if cheap money had not flowed into these companies over the years.

And the shortage of personnel in German service occupations would probably also be smaller if the federal government had not literally spoiled the prices with overpaid jobs as part of the fight against the pandemic. It wasn’t a problem, the money was there.

Basically, the ECB is in line with the trend. In the course of the energy transition, it is repeatedly emphasized that we must learn to pay the “real” prices for our standard of living. The prices that include all consequences. In the future, this will also apply to money. After all, interest is ultimately just the price of money.