“Stability through inflexibility is not the answer.”

Prof. Dr. Markus Brunnermeier, a renowned professor of economics at Princeton University, addressed the concept of economic and social resilience. He made it clear that resilience fundamentally differs from mere robustness, an aspect that is often overlooked in the current debate. Brunnermeier argued that businesses and economies should not make an illusory attempt to hedge against every conceivable risk, instead advocating a pragmatic approach that means understanding that crises are unavoidable and can even be vital catalysts for development and innovation.

In his role as a “doctor to the economy”, he analysed the most urgent economic policy challenges of our age, paying particular attention to the impact of import duties which, according to the Cologne Institute for Economic Research (IW Köln), could result in massive economic losses for Germany totalling EUR 133 billion over the next four years. His analysis of US economic policy under President Trump covered several critical factors, including the planned mass deportation of illegal migrants and its impact on the labour market, the ambitious tax reduction programme and the increasing struggle for power between the federal government and the US Federal Reserve. In light of all this, Brunnermeier predicts significant inflationary trends and sees challenging times ahead for Fed boss Jerome Powell in particular.

By contrast, Brunnermeier was remarkably optimistic about economic prospects for the German automotive sector, and was quick to dispel fears that the industry could degenerate into a conglomeration of “zombie companies”. He justified this view by highlighting the sector’s impressive capacity for regeneration previously demonstrated during the crisis period of the 1990s. The combination of technological excellence and presence of innovative leaders give him confidence in the future of the sector. 

Brunnermeier was pragmatically optimistic about what the recent coalition collapse means for German politics – an attitude that reflects his deep understanding of resilience. His central message that “stability through inflexibility is not the answer” emphasised the need to promote adaptability instead of focusing on merely repairing damage and recouping losses.