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The CDU takes 32% of the vote in Saxony down from 39% in 2014, 5 points ahead of the AfD, and he SPD wins in Brandenburg with a 3 point lead over the AfD. The federal government in Berlin is run by a coalition of the CDU and the SPD. The east west divide in Germany clearly shows with the AfD doing well in the former Communist East Germany. People in the east feel that they are "second class citizens" and this plus the migration policy of chancellor Merkel that alienated many including its partner in Bavaria, has given an opening to the AfD that has exploited these divisions. The AfD now has an ultra right wing and both the mainstream parties the CDU of Merkel and the SPD of Willy Brandt campaigned against it. The AfD or Alternative for Germany Party is basically a creation of chancellor Merkel's open migration policy which has affected Europe and may have provided the small margin to the pro-Brexit parties in Britain in the first referendum. The CDU and the SPD now look set to seek new leadership to tackle the problems of infrastructure neglect, the impact of the migration policies in fragmenting politics, increasing inequality, and the policy towards Britain and other states in the EU. ...

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Federal Reserve proposals in Dec 2011 for large U.S. banks leave capital cushions at 5% of assets. This phases in the higher 7% of assets rule for capital reserves and a surcharge of upto 2.5% based on bank risk levels under new Basel III regulations for implementation in 2016.

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Some economists at Global Insight and at the UAW, Gault at Global Insight and Blackwell at the UAW do not share Fed governor Fisher's view that labor has the bargaining power to raise wages as prices of food and fuel increase. With unemployment up and more workers pushed into part time work from full time this bargaining power is seriously eroded.

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The Bernanke Fed's decision on Sept. 16, 2013 to continue the pace of bond purchases is seen with relief in emerging markets and taken positively by equity markets worldwide. The Fed's decision is based on evidence of sluggishness in the economy and in the pace of job growth, as well as the likelihood of more political uncertainty about the budget because of sharp differences between Democrats and Republicans.

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Bernanke made a defense of the Fed's $600 billion monetary policy move in a Washington Post op-ed piece. He stated that the Fed's move had already led to a rise in the stock market, and this is how it would start "a virtuous circle" that would lead to a recovery of the US economy. Questions raised about the risk that this virtuous circle could go in reverse if gridlock shows no progress in Washington's political establishment.

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Bernanke's views that about the half point interest rate cut in 2002 that brought rate to 1.25% when he had just joined as Fed governor some months before, show that he had concerns about the overheating for the residential construction sector but these concerns were outweighed by the general deflationary tendencies in the economy and the crisis after the corporate scandals at the time and the prevailing gloom about the economy.

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The Free Democrats led by Christian Lindner are polling about 4% a week before the elections in Germany. Lindner's FDP was part of the Scholz SPD Greens coalition after winning 11% of the vote in 2021. Elections would be held in 2025 March. Yet with FDP breaking away from the coalition as its popularity dropped elections will be held next week. From the beginning this coalition was not a good one as FDP supported the debt brake and no spending, when Greens and SPD promised investment in infrastructure that were neglected by Merkel's CDU. Germany economy as shown in the article alongside by Tankersely and Eddy reporting from Wittenberg in the eastern region, has not grown in 5 years. Crumbling infrastructure is seen everywhere in cities across the country and the rail system lacks much needed investment.  Scholz wants to reverse this with Made in Germany and remove the debt brake. The CDU wants to cut taxes and regulation. No one knows if the FDP will pass 5% of the vote needed to have representation in parliament. It happened before for FDP- before the 2021 election. ...

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Daniel Tarullo, the new Fed Governor is the architect of the Fed's new pay guidelines. Fed officials at all the Fed banks around the country met the leaders of the large banks and thier compensation committee leaders. Tarullo has set up the principle based framework to guide pay which covers compensation practices that discourage risktaking that endangers the firm while enriching the employee, including risk management people in setting pay, better corporate governance and other principles.

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U.S. Federal Reserve chairman Yellen launches a sweeping review of practices for supervision of large banks in Nov. 2014. The review is designed to check "whether there are adequate methods for decisionmakers to obtain all necessary information to make supervisory assessments and determinations," and whether channels exist for decision makers to take into account divergent views when important issues arise. This is in response to questions about how the culture at the New York Federal Reserve may have stifled differing opinions on how banks should be supervised and what is proper information sharing between regulators and banks.

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Mr. Lindner of the FDP withdraws from negotiations leading to a stalling in the talks for a Jamaica coalition in Germany. FDP won 11% of the vote, the CDU about 32%, and the Greens 9% in the recent election. The CDU needs the FDP to form a coalition government as the Social Democrats have turned down requests to join the CDU in a future government. The SPD party sees no advantages in joining a coalition because it lost more of its worker base support by working with the CDU. If no coalition is formed a new election could be called by September 2018.

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Polls before the election show the SPD Social Demcorats, Greens and the Die Linke combined have a small majority of votes in German elections. Die Linke is the left party from the days of the party that ruled the GDR German Democratic Republic or East Germany under communist rule. In Berlin, Bremen, and the east German state of Thuringia the Social Democrats SPD, Greens and De Linke have formed coalition governments. With the emergence of right wing AfD in East Germany, the De Linke has emerged as an alternative to the established parties and the AfD in eastern Germany. Federal governments are difficult to form with the De Linke because of historical opposition to NATO. This may change as two younger leaders are now leading the party and in other policies there is similarity between the democratic socialist views of De Linke, SPD and the environmental policies of the Greens. FDP policy has generally not favored policies that favor working class, infrastructure investment, childcare and other issues important to voters in this election. This leaves the De Linke as a more likely alternative for a Greens SPD coalition partner if it can change to be flexible about its views on NATO. Today policies of president Biden in the US are also friendly to workers and families. This makes such a coalition possible if the socialist parties of the De Linke change to get things done instead of staying on the fringes of government. ...

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Taylor on the Bernanke Federal Reserve's quandary over its exit strategy from a loose monetary policy. He points to the consensus among leading economists, Rajan, Meltzer, Feldstein, who share his view that the costs of a loose monetary policy outweigh its benefits, that the Fed's policies are not working, and the need for a more rules based monetary policy.

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The Christian Democrats coalition with the Free Democrats fails to win in the German state of Lower Saxony by one seat in a close election. The CDU won 36% of the vote, the FDP 9.9%, the SPD 32.6%, the Greens 13.6%. Merkel's CDU and the CSU is showing 40% support nationally, the SPD 23%. The next election is in Berlin.