Tyskland. Remarkably, the market now has its hopes pinned on the hard left

 

German Elections: What's in the Shrinking Status Quo for Markets - Bloomberg


Friedrich Merz is exploring ways to loosen the country’s strict borrowing cap by reconvening the outgoing parliament where mainstream parties still hold a supermajority.
FT 24 February 2025
https://www.ft.com/content/33b4fcfd-803f-4b39-9778-6126196736c8


In politics and economics, as in opera, it’s not over until the fat lady sings

In the most famous German saga of them all, Brünnhilde saves her self-immolation until the final scene of Götterdämmerung  

In the longer term, it’s profoundly important that Germany’s Social Democratic Party has just suffered its worst-ever defeat, gaining 16.4% of the vote, 

while the Christian Democrats, with which it has alternated power throughout Germany’s postwar history, had its second-worst ever tally with 28.5% 

— just 44.9% between them. 

To release the “debt brake” and allow more borrowing than is currently permitted by the German constitution, the new coalition may well need the support of the hard-left Die Linke to reach the required 66%. 

Remarkably, the market now has its hopes pinned on the hard left. 

John Authers Bloomberg 24 February 2025

https://www.bloomberg.com/opinion/articles/2025-02-24/germany-elections-the-fat-lady-sings-and-the-center-holds-john-authers


Cometh the Hour - Wikipedia

Cometh the hour, cometh eventually Friedrich Merz

Germany’s European partners are desperate for it to act boldly to revive its economy and rearm. 

Unless it does so, it is not just the EU’s competitiveness and security that will be threatened but its very survival. 

With the AfD waiting to capitalise on public disillusionment with the established parties’ ability to deliver, another four years of dithering government would end in disaster.

Financial Times 23 February 2025

https://www.ft.com/content/17125a77-af46-41f9-8f8d-0555161efd05


Tillbaka till Rolfs länktips 24 Februari 2025

https://englundmacro.blogspot.com/2025/02/rolfs-lanktips-24-februari-2025.html



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