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Germany’s ‘Whatever It Takes’ Moment Powers European Markets

• Merz announces historic plan to fund defense, infrastructure
• Stocks rally, bonds slump as investors assess spending shift

Germany’s extraordinary spending plans are shaking up the region’s markets, powering European equities past US peers this year and reviving the euro from the brink of parity with the dollar.

Chancellor-in-waiting Friedrich Merz said Germany would do “whatever it takes” — a catchphrase made famous by former European Central Bank chief Mario Draghi — to defend the country and amend the constitution to exempt defense and security from limits on fiscal spending.

The move drove up Germany’s benchmark DAX stock index by as much as 3.8% and the prospect of more borrowing sent the country’s bond yields tumbling, both seeing the biggest moves since 2022. The pan-European Stoxx 600 climbed 1.8% to near a record set earlier this week, while traders bet on hefty gains for the euro.

“Big, bold, unexpected — a game changer for the outlook,” said Evelyn Herrmann, Europe economist at Bank of America Corp., adding that it represented a “paradigm shift.”

Making Europe Great

The historic plan, unlocking hundreds of billions of euros for transportation, energy and housing, is a dramatic shift that upends Germany’s controls on government borrowing. It invokes memories of Draghi’s 2012 speech to save the euro, which became a shorthand for policy determination.

Deutsche Bank AG strategist Maximilian Uleer — a long-standing bullish voice on European stocks — said the region was facing its own “Make Europe Great Again” moment — a play on US President Donald Trump’s campaign slogan for America.

Uleer reiterated his overweight stance on European stocks overall, calling the German proposal “above even our positive expectations.”

Stocks geared toward the German economy jumped, with the country’s mid-cap MDAX Index surging as much as 6.9% — the most since March 2020. That was led by construction firms such as Bilfinger SE and Hochtief AG, up 24% and 18% respectively. Defense companies like Rheinmetall AG added to a stellar rally this year, while heavyweights Deutsche Bank and Siemens AG were both up over 8%.

“There’s a very strong dynamic in Germany,” said Frederic Surry, deputy head of equities at BNP Paribas Asset Management, who has reduced his overweight on the US in favor of Europe. “We’re looking at a broadening, notably on midcaps.”

Winning Stocks

European stocks have been among the best performers in the world this year, as investors bet on stimulus and a potential cease-fire in Ukraine. Cheaper valuations have also proved attractive at a time when funds are exiting pricey US equities, overshadowing concerns around a global trade war for now.

The benchmark Stoxx 600 is on course to outperform the S&P 500 by the most in a decade on a quarterly basis, according to data compiled by Bloomberg. Nine of the top 10 best performing stocks this year in the MSCI World Index — the benchmark for the developed world — are now European, data compiled by Bloomberg show. They include defense companies Rheinmetall, Thales SA, Leonardo SpA and Saab AB.

Euro Recovery

The euro climbed nearly 1% to its strongest level since November at over $1.07. Just a month ago, the common currency was a whisker away from parity with the dollar, trading almost at $1.02. This shifting dynamic could potentially reverse a multi-year US dollar rally, according to Julian Weiss, head of global Group-of-10 vanilla FX options trading at Bank of America.

Banks including Goldman Sachs Group Inc. have been abandoning predictions that the euro will slide to be worth the same as one greenback. Instead, some hedge funds are now buying options wagering the euro will climb another 12% to $1.20 in six to nine months, according to traders familiar with the transactions. “This is Merz’s ‘Draghi moment’,” said Kathleen Brooks, research director at XTB. “The strong recovery in the euro suggests that Europe’s star is rising.”

Europe about to abandon its neoliberal fiscal “balance the budget” rule to invest heavily in military and infrastructure.

Is this the turning point for the European economy?

Meanwhile, Trump appears to have bought into the charlatans who told him that “dollar must weaken” in order to re-industrialize, which will prove fatal if it keeps going. I give it a few months before the US realizes the huge mistake it is in and will likely attempt to pivot by then.

Please let this be real:
https://xcancel.com/fresh_sadegh/status/1897010936499826692

Far news agency (an IRGC affiliate) reports about the formation of the “Islamic Resistance in Syria”, an umbrella group made up of resistance forces. Their aim is “to confront American-Israeli-Turkish plots to dismantle Syria with the help of the current militia ruling Damascus”

BREAKING: The Supreme Court just weakened the Clean Water Act's limitations on raw sewage discharge into our water in a 5-4 ruling.

Owning the libs by making everyone drink more doo doo water

Middle East: Israel agreed to extend the ceasefire during Ramadan. The Resistance Movement urged the United Nations to act against Israeli violations in the West Bank.

• Telesur English

Anyone know where I can find a list of Dems that have voted yo approve trumps nominees?

https://www.businessinsider.com/trump-joint-address-chips-act-horrible-bill-2025-3 Trump trying to get rid of CHIPS act. How you run on bringing manufacturing etc and tariffing other countries on their tech.... But go on a grudge tour with this act

Russian Wage Growth Hits 16-Year Peak Amid Race to Find Workers

Russia’s real wages in 2024 increased the most in 16 years as the country grapples with a lack of workers and even seeks to import them from so-called friendly countries, including Myanmar.

Annual growth in real wages reached 9.1% last year, the highest since 2008, according to Federal Statistics Service data published late Wednesday. This contrasts with the 2.7% globally estimated by the International Labour Organization.

The salary spike reflects a still-acute labor shortage as the army and industries servicing military needs draw scarce workers away from other sectors of the economy, forcing companies to compete with salaries and benefits. Unemployment stood at a historic low of 2.3% at the end of last year, though edged up to 2.4% in January, the statistics service data show.

The workforce shortfall has fueled inflation and limited economic growth potential, spurring Russia to seek new sources of labor to plug the gap in its market. Measures have included attracting teenagers and pensioners to using prisoners and inviting foreigners from countries that maintain good ties with Russia.

In the current economic conditions, “it’s necessary to look at completely new countries” to attract labor migrants to Russia, Economy Minister Maxim Reshetnikov said in the State Duma on Monday, as Moscow prepared to host a government delegation from Myanmar. Russia is discussing bringing in workers with the country’s leadership, Reshetnikov said, according to the state-run Tass news service.

Thousands of North Korean laborers were sent to work at construction sites across Russia last year amid workforce shortages due to the Kremlin’s war with Ukraine, South Korea’s Yonhap News reported, citing the nation’s spy agency.

Running out of people to work in the economy.

im late ik. Democrats are so useless all sitting there doing nothing, no booing, no slogans, no shouting, nothing. except for that one guy.

libs on resetera dot com, the world's most lib website, are now regularly saying things like, "China is the more reasonable global power", "at least China reigns in its oligarchs", "China is going to push BRICS to dedollarize and the rest of the world will move on when the US collapses"

material reality is simply too powerful, folks

(then they go on to say "Russia has spent decades destroying america from within" so who knows)

South Korea air force jets accidentally drop bombs on homes, injuring 15

POCHEON, South Korea, March 6 (Reuters) - Fifteen people were injured in South Korea on Thursday after bombs dropped by fighter jets landed in a civilian district, damaging houses and a church during military exercises in Pocheon, the Air Force and the fire department said. The Gyeonggi-do Bukbu Fire Services said in a statement that 15 people were wounded, out of which two were seriously hurt. Pocheon is about 40 kilometres (25 miles) northeast of Seoul, near the heavily militarised border with North Korea. South Korea's Air Force said eight 500-pound (225kg) Mk82 bombs from KF-16 jets fell outside the shooting range during joint live-fire exercises. "We are sorry for the damage caused by the abnormal drop accident, and we wish the injured a speedy recovery," the Air Force said in a statement. Residents in the area have protested about the disturbance and potential danger from nearby training grounds for years. Residents were evacuated around midday as authorities checked whether there were any unexploded bombs, Yonhap news agency said. Reuters' photographs from the scene showed shattered windows and a church building strewn with debris. The defence ministry said earlier on Thursday that South Korea and U.S. forces were holding their first joint live-fire exercises in Pocheon, linked to annual military drills due to start next week.

South Korea and the United States will kick off their annual Freedom Shield exercise on Monday, said Seoul's Joint Chiefs of Staff (JCS). The joint drills, which will run until March 20, aim to strengthen the readiness of the alliance for threats such as North Korea, the JCS said. This year's drills will reflect "lessons learned from recent armed conflicts" and North Korea's growing partnership with Russia, it added. "Our planners look across the globe and identify the trends that are changing and we look at how we can incorporate that into our exercises," Ryan Donald, a spokesperson for the United States Forces Korea (USFK), told a media briefing on Thursday. About 70 combined field training sessions are scheduled for this year's exercise, said Lee Sung-jun, a spokesperson for Seoul's JCS.

Trump electronically repo'd HIMARS

The work report of the government from Third Session of the 14th National People's Congress is out on March 5th, summarized below:

Looking back at 2024

• 5% GDP growth
• Food production reached 1.4 trillion pound for the first time
• New employment in the urban area: 12.56 million
• Alternative energy vehicle production breached 13 million annually

Target for 2025

• GDP growth at ~5%
• New employment in the urban area: >12 million jobs
• CPI to reach 2%
• Food production at ~1.4 trillion pound
• Energy consumption per unit GDP to fall ~3%

Important work for 2025

• Budget: deficit spending to reach ~4% (from 3%, or +1.6T yuan from previous year)
• Government investment: to arrange new local government bonds at 4.4T yuan (+500B yuan), combined government debt to reach 11.86T yuan (+2.9T yuan)
• Special debt: to issue special extra long term government bonds at 1.3T yuan (+300B yuan), and new special government bond at 500B yuan
• Consumption: to implement targeted policies to raise consumption, to arrange extra long term bond at 300B yuan to support consumption (subsidies to trade in older goods with new goods)
• Nascent industries: to further propel the development of nascent industries e.g. commercial airliners, low attitude airspace economy. To cultivate biotech production, quantum technology, embodied AI, 6G and other nascent industries. To accelerate the digital transformation of manufacturing sector. To develop AI networked EV, AI-powered phones and computers, AI-powered robots etc.
• Education: to increase the number of higher and middle education degrees, to gradually implement free pre-school education
• Market environment: to implement long term mechanisms to resolve problems with outstanding payments by corporations/companies, to increase law enforcement actions against corporate crimes
• Opening up: to push for the orderly opening up of internet and cultural spaces, to further the opening up of telecommunications, healthcare, education and various sectors
• Housing: to continue implement strong policies to slow the plunging real estate prices and stabilize the market. implement the redevelopment of provincial towns and aging residential housing units. to encourage purchase of stock houses (oversupplied units). to continue the good work on settlement/closing for housing purchases.
• Rural development: to revitalize the rural industries, to activate the central government coordinated inter-provincial food production compensatory policy, to increase support for food producing provinces, to expand on channels to improve farmers’ income.
• Urbanization: to push for guaranteed housing system for qualified citizens who are turning from farmers into urban workers. to continue the revitalization of urban and redevelopment of old neighborhoods in cities.
• Ecology: mechanisms to encourage healthy and green consumption, to encourage new green, low carbon production and lifestyles
• Employment: to enlarge the employment opportunities for high school graduates, to strengthen the welfare guarantee for gig workers and new hires. to improve benefits for tech talents.
• Healthcare: to optimize the drug procurement policy and strengthen the regulation and evaluation of drug quality (note: this was a huge scandal in China last year when many hospitals procured fake drugs to lower costs), to increase the per capita subsidies of citizens health insurance and basic public healthcare service by 30 yuan and 5 yuan, respectively
• Social welfare: to raise the minimum amount of urban citizen pension by 20 yuan, to formulate policies to encourage birth, to provide childcare subsidies

Overall, not that different from last year’s budget, with the exception on the new emphasis on AI. The budget deficit is still on the conservative side, breaking from the usual 3% to 4% this year. It may or may not be enough to boost the slumping consumption, but time will tell. Other than that, nothing indicates fundamental change from the usual policies.

China announces plans for major renewable projects to tackle climate change

BEIJING, March 5 (Reuters) - China said on Wednesday it would develop a package of major projects to tackle climate change as it moves to bring its carbon dioxide emissions to a peak before 2030 and become carbon neutral by 2060.

The world's largest producer of climate-warming greenhouse gas said it would develop new offshore wind farms and accelerate the construction of "new energy bases" across its vast desert areas, the National Development and Reform Commission, the country's economic planner, said in an official report published on Wednesday.

"China will actively and prudently work towards peaking carbon emissions and achieving carbon neutrality," the report read.

Among the proposed projects cited in the report by the state planning agency was a controversial hydropower facility on the Yarlung Tsangpo river in Tibet, which has raised concerns in India about its potential impact on downstream water flows.

It also said it would develop a direct power transmission route connecting Tibet with Hong Kong, Macao and Guangdong in the southeast.

However, coal will remain a key fuel, with the NDRC report saying the country will continue to increase coal production and supply this year even as it plans for trials of low-carbon technology at its coal-fired power plants and to promote initiatives aimed at substituting fossil fuels with renewables.

China has been struggling to strike a balance between fostering economic growth and meeting its environmental goals.

The NDRC said the 3.4% reduction in the amount of carbon emissions per unit of economic growth last year "fell short of expectations", blaming rapid growth in energy consumption as well as extreme weather.

China is not expected to meet its five-year goal to bring carbon intensity down by 18% by the end of this year, and it has not yet announced an annual target for 2025.

It will also struggle to meet a separate target to cut the amount of energy consumed per unit of growth by 13.5% by the end of this year, despite exceeding expectations with a 3.8% reduction last year, analysts said.

"Despite the world record expansion of renewables, an inconvenient truth is that China's economy hasn't become much more energy efficient in recent years," said Yao Zhe, global policy advisor with Greenpeace in Beijing.

Macron apparently given some unhinged bellicose speech

Truly funny how you can see continuity of trump saying europe should spend on military, biden causing a war, and euros now think it’s their own idea to spend more on military, just breathtaking