People in many of the world’s most advanced nations – including the euro area, Japan and the U.S. – are holding more of it than ever. In the U.S., for example, currency in circulation stood at an estimated $1.76 trillion as of late September. That’s about 8.2% of gross domestic product, up from just 5.6% before the 2008 financial crisis and close to the highest level in at least 36 years.
Benjamin Franklin’s share of total U.S. currency in circulation reached 80% in 2018, up from 73% a decade earlier.
The city of Berlin has agreed drastic measures to curb the surging cost of housing in the German capital, including a five-year freeze on rents and the right for tenants to have them lowered if they exceed a government-imposed figure.
The new curbs — presented by Social Democrat mayor Michael Müller and members of his leftwing government on Tuesday — will apply to an estimated 1.5m apartments.
Supporters say the measures are needed to preserve affordable housing for low-income households, and to halt the spiraling rents of the past decade. But critics warn that the Berlin plan will drive away investment and exacerbate the severe housing shortage in the fast-growing city.
Soaring rents in Berlin and other large German cities have become politically controversial in recent years, and a favorite campaign theme for left-wing parties.
According to a study by Immowelt, a property website, rents in Berlin have jumped 104% since 2009. The average rent per square meter in the city stands at €11.60 ($1.20 per square foot “PSF” per month), a notable jump from €5.70 ($0.59 PSF) in 2009 but still lower than the 2019 prices in cities such as Munich (€18.60) ($1.92 PSF) and Frankfurt (€14.20) ($1.47 PSF).
Under the new plan, landlords will be banned from raising rents for the next five years. The city will also give tenants the right to demand lower rents if they exceed official rent caps by 20%. According to the new rental table presented on Tuesday, the maximum rent landlords can demand for recently-built apartments is €9.80 per square meter ($1.01 PSF), with minor top-ups allowed only for properties with high-quality fittings or located in an especially desirable neighborhood.
Berlin has gained almost 400,000 new residents over the past decade, taking the city’s population to 3.75m. The recent growth reflects at least in part Berlin’s new-found economic dynamism: long derided as a business backwater, devoid of important corporate headquarters, the city has emerged as a location for the technology and start-up scene.