U.S. and Asian bourses just reminded us how delicately the AI-fueled rally rests on central-bank psychology. A 4-plus-percent slide in South Korea’s Kospi and 3 % drops in Tokyo and London (reuters.com) bled into Wall Street before Nvidia’s intraday flip turned the S&P 500 positive. Yet equity inflows collapsed 80 % week-on-week to $4 bn, the weakest since summer, as investors fled pricey tech and waited for delayed U.S. jobs data (reuters.com).

The trigger was words, not earnings: remarks by Fed officials Schmid, Collins and Kashkari chopped the implied probability of a December rate cut from “near-certain” to 50 % in 48 hours (ft.com). When guidance moves trillions faster than fundamentals, we are in a policy-narrative market, not a price-discovery one.

History rhymes: 1998’s Fed-brokered calm preceded 1999’s dot-com melt-up; today’s AI exuberance courts the same reflexive risk. If capital keeps chasing concentration while data darkness persists, a valuation air-pocket beckons. Dani Rodrik warned, “Markets are excellent servants but terrible masters.” May policymakers—and investors—remember which role they’ve assigned. (Quote: Dani Rodrik, 2023)

The Gist AI Editor

Germany Fortifies Digital Borders

Berlin is moving decisively to secure its critical infrastructure. Lawmakers in the Bundestag on Thursday approved legislation granting the Interior Ministry new powers to bar technology suppliers deemed risky. (Politico.eu) This policy pivot, largely seen as targeting Chinese firms like Huawei, prioritizes national security and technological sovereignty over unfettered market access. From our perspective, while securing vital networks is a legitimate function of a limited state, such measures must be narrowly tailored to avoid becoming a pretext for broader protectionism that ultimately harms consumers and stifles innovation.

US Designates German Leftist Group a Terrorist Organization

The Trump administration has formally designated “Antifa Ost,” a German far-left group, as a foreign terrorist organization. The State Department cited a series of violent attacks between 2018 and 2023 against individuals perceived as “fascists” as justification for the move. While violence and intimidation have no place in a free society, the expansion of state power to label domestic or allied-country political groups as “terrorists” warrants significant skepticism. Such powers, once created, are rarely relinquished and can be turned against peaceful dissenters.

Markets Navigate Fed Uncertainty

US stocks rebounded following a global tech rout, but investor sentiment remains fragile. (FT) The key driver of uncertainty is the Federal Reserve, with markets now pricing a December interest rate cut as a coin toss, a significant drop from the 95% probability priced in just weeks ago. In energy markets, a larger-than-expected increase in US natural gas inventories signals robust supply. (WSJ) The U.S. Energy Information Administration reported inventories rose by 45 billion cubic feet, suggesting potential downward pressure on future energy prices for households and industry.

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

Trump’s $1bn BBC threat isn’t about the law — it’s political theatre
— Financial Times

Michael Burry, the short seller who bet against AI
— Financial Times

Hungryroot Coupon Codes: 30% Off in November 2025
— Wired

US stocks gain ground after global tech rout
— Financial Times

Friday assorted links
— Marginalrevolution

U.S. Natural Gas Inventories Rise More Than Expected
— Wall Street Journal

German Aviation Tax Cut Lacks Consumer Guarantee

Berlin’s governing coalition has moved to lower Germany’s air transport tax, a measure intended to bolster the aviation sector which claims it is still recovering from pandemic-era losses. The reversal of a 2024 tax hike will lower the levy on long-haul tickets from €70.83 to €58.06, with the total annual relief for the industry estimated at €350 million (ZDF), (Reuters). While airlines promise an expanded roster of flights, they remain pointedly non-committal on whether these savings will translate into lower ticket prices for consumers. This raises valid questions about whether the policy is a genuine market stimulus or simply a corporate subsidy. Without clear commitments to pass savings on, the move appears to prioritise industry profits over direct benefits for travellers.

Italy’s Public Pension Maneuver

In Italy, a new budget measure is creating friction with public sector unions. The government’s proposal nominally accelerates severance pay (TFR) payouts by three months for retiring public workers. However, it simultaneously eliminates a tax break on payments up to €50,000. Italy’s largest trade union confederation, CGIL, has branded the intervention a “sham,” calculating it effectively strips €22.6 million from public employees (Ansa). This maneuver highlights the fiscal pressure on the Italian state, which appears to be resorting to complex rule changes to manage its long-term liabilities. Such actions undermine fiscal transparency and erode trust between the state and its employees by altering promised benefits through the back door.

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

Cgil, governo penalizza pubblici su liquidazione
— Ansa

Istanze entro 15 dicembre per il fondo strade piccoli Comuni
— Ansa

Trump administration to deny visas to immigrants with obesity, diabetes and cardiovascular disease
— El Pais

Airlines: Auswirkung auf Ticketpreise unklar
— ZDF

Spahn pocht auf Rentenkommission
— ZDF

Bambi-Verleihung – die schönsten Bilder des Abends
— ZDF