Crypto News: Germany’s race is only just starting

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During the Cold War, spies were exchanged on the Glienicke Bridge spanning the Havel River between West Berlin and Potsdam in the then-Soviet-controlled east.

The bridge has become an ideological frontier of sorts once again after the post-Communist Left party took the most votes in Berlin, and the far-right AfD won the surrounding state of Brandenburg, whose capital is Potsdam.

The Glienicke Bridge. Photographer: Michele Tantussi/Bloomberg

Germany's federal elections yesterday revealed a deepening polarization in society, most notably between the former east and the west 35 years after reunification.

That matters at a time when Europe's biggest economy is stumbling and business leaders are crying out for politicians to make the hard choices needed to reinvigorate competitiveness.

Friedrich Merz is poised to become chancellor at the head of a "grand coalition" of his center-right CDU/CSU bloc and the center-left Social Democrats, once they forge a common program for government.

The question is for how much longer the center can hold.

Friedrich Merz. Photographer: Krisztian Bocsi/Bloomberg

The nationalist, Russia-friendly AfD was a big winner, doubling its support to some 21%, as polls predicted. Still, Elon Musk's full-throated endorsement of Alice Weidel's party failed to secure victory, and the AfD remains untouchable, shut out of coalition government.

US President Donald Trump posted a full-caps message of support for the conservative shift in Germany, without mentioning Merz.

Aiming for a government by late April, Merz is in a hurry. He cited "massive" pressure from Russia on one side and from Trump's upending of the transatlantic alliance on the other, urging European "independence" from the US.

Merz sees solving Germany's problems as key to defanging the AfD, and the ball is in his court.

Weidel is playing a longer game, waiting for him to trip up in the face of a growing list of domestic and international challenges.

Whoever wins, nothing less than Europe's future is at stake. — Alan Crawford

Alice Weidel. Photographer: Krisztian Bocsi/Bloomberg

Global Must Reads

Volodymyr Zelenskiy said he'd happily trade his presidency for Ukraine's NATO membership, as the war reaches its three-year mark. He told reporters the US had dropped its demand for Kyiv to pay $500 billion as part of talks to give Washington a cut of Ukraine's mineral wealth. Two top Trump officials declined to describe Russia as the aggressor, while the European Union plans a summit March 6 to accelerate military aid to Ukraine.

Volodymyr Zelenskiy in Kyiv yesterday. Photographer: Andrew Kravchenko/Bloomberg

The Trump administration took aim at China with a series of moves involving investment, trade and other issues that raises the risk ties may soon worsen between the US and its top economic rival. Taken together, the steps amount to the most sweeping, forceful actions targeting Beijing of Trump's second term and could complicate a deal to reduce China's trade surplus with the US.

Israel won't allow forces of the new Syrian administration to enter territory south of Damascus, Prime Minister Benjamin Netanyahu said yesterday, lifting the veil on long-term plans for its northern neighbor after the fall of the Bashar Al-Assad regime. Separately, Israel's defense minister said a sweep for Palestinian militants in the northern West Bank could continue for a year.

The EU estimates that the first wave of Trump's steel and aluminum tariffs will hit as much as €28 billion ($29.3 billion) of its exports in what would be a massive escalation in the trade war. The amount of goods would be about four times larger than the last time the US president targeted the bloc's metals sector.

Growing discontent with left-wing governments is helping fuel a market rally in Latin America on early bets that the next wave of elections in 2026 will usher in more business-friendly administrations. Traders emboldened by the re-emergence of Trump in the US and Javier Milei's tenure in Argentina are focusing on the prospect of electoral change in Brazil and Colombia.

Pope Francis remained in critical condition for a second day even though he didn't experience further respiratory crises, the Vatican said in a statement.

Several US government agencies have advised their employees to ignore for now a demand from Musk's government efficiency office to justify their jobs or face dismissal.

Bangladesh's interim leader, Muhammad Yunus, invited Musk to visit the country and launch his Starlink satellite internet service there.

The Cook Islands said it has formalized cooperation pacts with China, including an action plan for a comprehensive strategic partnership and an agreement covering exploration for seabed minerals.

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Chart of the Day

Pessimism is rife among British consumers and households looking to cut their expenses, data show. Gone too are the so-called excess savings built up during the pandemic, a victim of the savage increase in prices since then. It all adds up to a bleak picture for Prime Minister Keir Starmer and his Labour government, which is sliding in opinion polls.

And Finally

Indonesian regional leaders were no sooner sworn in last week than they were told to bring a military uniform for a weeklong retreat ordered up by President Prabowo Subianto, the ex-general who rose to power pledging to upend politics. They'll face a schedule including 6 a.m. aerobics, roll calls, and talks on everything from budgeting to food security at a military academy about seven hours drive from Jakarta. The retreat is taking place as signs of dissent emerge against government cuts pushed by Prabowo as he favors his signature programs including free school meals and health checks.

A demonstrator uses tape to mark the words "pay, pay, pay" on a road during a protest in Jakarta on Friday. Photographer: Muhammad Fadli/Bloomberg

Thanks to the 47 people who answered the Friday quiz and congratulations to Gabriel Sivzattian, who was first to correctly identify Argentina as the country whose leader faced impeachment calls for promoting a memecoin called Libra.