Helena Melnikov, chief executive of the German Chamber of Commerce and Industry (DIHK), went on ARD television with a two-word demand aimed at Washington: "No more zigzagging." With Republicans losing control of both chambers in the US midterms, Germany's business establishment sees a potential window for more predictable trade relations with its largest export market. The hope is that a divided US government will constrain the wild oscillations in tariff policy that have made planning nearly impossible for German exporters. That hope may be misplaced. Achim Wambach, president of ZEW, Germany's leading economic research institute, delivered the colder read: losing his congressional majority could push Trump to lean harder into trade and foreign policy — precisely the areas where presidential authority is broadest and least constrained by Congress. The US executive branch can impose, adjust, and reverse tariffs with minimal legislative input. A president who just lost domestic leverage doesn't become quieter on trade. He becomes louder. Wambach added a second inconvenient truth. Even under Democratic control, Congress is unlikely to return to free-trade orthodoxy. There is broad bipartisan consensus on protecting US industry and maintaining a confrontational trade posture toward China. German exporters hoping the midterms would restore the pre-Trump trade architecture are reading the wrong map. The structural shift in American trade politics predates Trump and will outlast him. Meanwhile, Germany's auto industry — the economy's bellwether — showed a surprising burst of confidence. The Ifo institute's business climate index for the sector jumped from minus 33.2 to minus 4.1 points, the highest reading since mid-2024. Companies' assessment of their current situation turned positive for the first time in over two years. A Franco-German agreement on a joint automotive strategy appears to have helped. But Ifo expert Anita Wolfl was blunt: "There can be no talk of an all-clear." Sharp monthly fluctuations in confidence signal persistent uncertainty, and the core challenge — catching up with leaders in EV and software technology — remains unresolved. The survey was conducted in October, before the midterm results, meaning the confidence boost reflects domestic and European dynamics, not any US political shift. BMW underscored the fragility of the moment by reporting a nearly 15% drop in quarterly net profit, driven by weakening China sales that offset European and US gains. Germany's automakers are caught between three unstable markets simultaneously. In Berlin, a different kind of extraction debate is unfolding. The incoming coalition of the Left Party, Greens, and SPD has proposed bringing large private housing portfolios into public ownership, targeting companies with more than 10,000 apartments. The plan envisions compensation of no more than €16 billion for 160,000 homes — roughly €100,000 per unit. Vonovia CEO Luka Mucic called it "simply the wrong approach," arguing it creates no new housing and undermines investment confidence. The Financial Times estimated Vonovia's Berlin properties alone are worth €20.4 billion, against proposed compensation of €12 billion. But housing researcher Maximilian Fuhrmann at the German Tenants' Association calculated an average portfolio-wide value of just over €100,000 per unit using Vonovia's market capitalization and debt — roughly matching the proposed compensation. Three stories, one throughline: Germany's economic model — export-driven, auto-dependent, housing-financialized — is being squeezed from every direction. The US trade environment is structurally less friendly regardless of who controls Congress. The auto sector's confidence bounce is real but built on sand. And the Berlin housing fight reveals how deep the tension between capital returns and housing affordability has become. German business wants stability. The world is offering volatility.
