Commentary:
In recent German Election, the leader of Christian Democratic Union Angela Merkel has won a near-historic victory and became the chancellor for the third term. This victory could lead the Euro power house to a fast recovery from the “euro area’s longest-ever recession”. However, her victory has created a government coalition, between her party and the social democratic; also long-term allies- the free Democratic Party is out of the parliament. Although the election is over, in the short-term, this political instability could have a negative effect on policy making, and eventually slow down the market. Ultimately this would rattle inventors.
Last week Monday, just before the election, Germany’s blue-chip stock market index (DAX) has surpassed its previous all-time high record in May this year. The demand for German equities are high, its shares gain substantially in European markets as well as in Asia and North America. This can lead to an increase of German export goods. This is good news for Germany, especially their “money-maker” auto industry. According to Daimler AG, they are “having trouble filling orders as August sales at all-time high. Also Porsche AG, the Volkswagen AG’s sports car division will reach their sales target of 200,000 vehicles 3 years earlier than initially planned. This can boost their domestic jobs, creates large revenue and expenditures, as well as foreign trade within the euro-zone and the rest of the world. Since Germany is the “engine” of the recovery of the euro-recession, these factors will definitely