service.spiegel.de/cache/international/0,1518,378956,00.html

Germany's conservative Christian Democrats have reached an agreement with the center-left Social Democrats to create a grand coalition government with Angela Merkel as the country's first-ever female chancellor, the news agency DPA is reporting. The deal, though not yet officially announced, is also being reported by German public broadcaster ZDF and other media. On Monday, DPA reported that during a telephone conference with the board of the CSU, Stoiber said Merkel would become chancellor and that official coalition negotiations would begin next week. Meanwhile, the board of the SPD has approved the outcome of the talks between the party leaders with an overwhelming majority. Reuters is reporting that the deal will enable the Christian Democrats to select the next chancellor as well as the president of Germany's parliament, the Bundestag. The Social Democrats, meanwhile, are expected to lead eight key ministries out of a total of 13. They include the foreign ministry, the finance ministry, the justice ministry, the labor ministry, the health ministry, the transportation ministry, the environmental ministry and the development ministry. The Christian Democrats, meanwhile, would lead the defense, economics, education and research, interior, agricultural and consumer protection, and family ministries.

Okay, what's this all mean for us?

How beholden to the Chancellor's decisions are these ministers? If the SD's have more, what's that do to German policy?

Good or Bad?

Germans like David Hasselhoff.

Quoted: It's a mess that will fall aprt ion short order as soon as Merrkel tries to make the German public take the bad economic medicine. Germany is locked in denial… The economy is broke and don't have the balls to vote in someone to fix it. ANdy

I'm so glad you guys in the UK didn't enroll in the Euro suicide pact.

I don't really wish harm on the EU economy, I just think it was a horrible decision to tie together the economies of several nations that have not had a long term stable history with their own currencies.  Britain does have a long term stable history for its currency, like the US, so it would be stupid to join in and give up total control.  If the EU gave up total financial control to the most stable country, it might have made sense.  But the current system is just a recipe for disaster.  Germany was two separate countries and economies less than 20 years ago, one of which was socialist/communist.  Italy, a country with an unstable currency history mostly due to wars,  already wants out of the Euro.  And political leaders are already blaming the Euro, and each other for economic problems.

I foresee war in Europe again within 2 decades, but this time it appears the UK has managed not to be pulled into it.  So, it'll be a local event, not involving the US, UK, or Russia.  Probably more of a cold war, with small flareups and tons of political posturing, but no major battles and loss of life.

Of course I have no economic or political degrees, and am giving my opinions completely from what I've seen on TV and read on the internet.  So, I'm just about as credible as the talking heads on TV.

Merkel is much better than Schroeder, but will be relatively weak politically.