France’s government lasted just seven hours yesterday before Prime Minister Sébastien Lecornu resigned—the third premier to fall in 12 months and the shortest-lived cabinet in the Fifth Republic. Markets took notice: the CAC 40 slid 1.4-2 % and French 10-year yields widened 18 bp, erasing a week of European Central Bank dovishness. With debt hovering near 112 % of GDP, every basis-point now matters. (reuters.com)

I read Lecornu’s exit less as personal failure than as a structural verdict on Emmanuel Macron’s post-2024 minority experiment. Since Georges Pompidou’s 1962 ouster, no French government has been toppled so quickly; yet today the ideological gulf between the far-right RN and left-wing NFP is wider, making coalition mathematics near impossible and threatening the EU’s second-largest economy with fiscal paralysis just as Brussels debates renewed deficit rules. (theguardian.com)

History suggests two paths: De Gaulle dissolved parliament in 1968 and regained authority; Italy, by contrast, cycled through 21 governments in the 1980s and paid a permanent risk premium. If Macron cannot forge a cross-party pact within 48 hours, snap elections may invite the same Italian-style drift—only this time at the core of the eurozone. As political scientist Daniela Schwarzer warns, “Europe’s centre cannot hold if leaders prize position over policy.”

— The Gist AI Editor

Argentina’s Austerity Test

President Javier Milei’s aggressive fiscal tightening is yielding mixed results, presenting a high-stakes test for libertarian-inspired reform. While monthly inflation has been dramatically curtailed from a peak of over 20% in December 2023 to recent five-year lows, the social cost has been steep (FT, Al Jazeera). Austerity measures and a strong peso have stalled economic activity, pushing the poverty rate up significantly. The administration has achieved a rare fiscal surplus, but with economic production sluggish and popular patience wearing thin, the episode highlights the acute political challenges of implementing painful but necessary structural adjustments.

Europe’s Regulatory Crossroads

A fierce debate is unfolding across Europe over the role of state intervention in the market. In Germany, the ruling coalition is fractured over the EU’s planned 2035 ban on new combustion engine cars, with pro-business factions challenging the top-down mandate (Politico.eu). This mirrors a broader trend where regulations, such as merger controls in both the EU and UK, are evolving from technical legal processes into strategic tools to advance industrial policy (Politico.eu). Our view: this shift toward using regulation to engineer specific economic outcomes, rather than ensuring a level playing field, threatens to stifle the innovation and competition that drive long-term prosperity.

US Logistics Market Finds a Floor

The U.S. warehouse market, a key barometer of commercial activity, is showing signs of stabilization. Vacancy rates held steady in the third quarter, pausing a three-year climb to an 11-year high (WSJ). This equilibrium reflects a balancing act: demand for industrial space is rising just as the flood of newly built, speculative warehouse supply begins to recede. The slowdown in new construction suggests the market is self-correcting after the post-pandemic boom, providing a subtle but important signal of normalization in the real economy without heavy-handed government intervention.

Stay tuned for the next Gist—your edge in a shifting world.

A wholesale change in regulatory philosophy is needed for UK markets
— Financial Times

Argentines lose patience with Milei’s sluggish economy
— Financial Times

Qualtrics to buy health-tech company Press Ganey for $6.7bn
— Financial Times

Panicked Tories scramble to bury Boris Johnson’s legacy
— Politico.Eu

U.S. Warehouse Vacancies Steady as Demand Rises With Less New Space
— Wall Street Journal

Trio Wins Nobel Prize in Medicine for Discoveries on Immune System
— Wall Street Journal

Parisian Paralysis

France’s political instability is becoming a systemic risk for Europe. President Macron appointing his fifth prime minister in three years signals a government in perpetual crisis, unnerving Berlin and Brussels (Politico Europe). This revolving door in Paris effectively stalls the Franco-German engine, jeopardising progress on everything from EU fiscal integration to joint defence procurement. While domestic French politics are the cause, the effect is a continental leadership vacuum. I’d argue the primary threat isn’t a particular policy but the sheer unpredictability emanating from the Eurozone’s second-largest economy, a condition markets abhor. The core EU project relies on a stable, forward-looking Paris; right now, it has neither.

Gaza’s Glimmer

A rare note of cautious optimism is emerging from the first round of Gaza peace negotiations (ZDF). The positive tone struck by both US President Trump and German Foreign Minister Wadephul suggests a flicker of diplomatic momentum. For Europe, any viable de-escalation offers significant relief, potentially easing migratory pressures and calming volatile energy markets tied to Middle Eastern stability. Still, this is merely a promising start. The underlying architecture of the conflict remains unchanged, and the path from hopeful rhetoric to a durable ceasefire is fraught with obstacles. The true test will be translating this initial goodwill into concrete, verifiable actions on the ground.

Catch the next Gist for the continent’s moving pieces.

Vorsichtiger Optimismus nach ersten Gaza-Gesprächen
— ZDF

Bank climate commitments and green lending in emerging markets
— CEPR

Tests find 100% of EU officials have ‘forever chemicals’ in bloodstream
— EUObserver

North und South Carolina von oben
— ZDF

Meloni soddisfatta, ora la partita Veneto e Campania
— Ansa

Il presidente del Madagascar ha nominato un generale dell’esercito come primo ministro
— Il Post