US voters have their say

US voters have their say [View in browser]( [Bloomberg]( Follow Us [Get the newsletter]( Midterm elections in the US don’t always reverberate across the globe, but today’s vote certainly will. It could see President Joe Biden’s Democrats lose control of Congress, almost ensuring two years of policy gridlock and partisan gamesmanship — hardly the benign sharing of power that “curbs the worst excesses of both parties” advocated by Twitter’s new chief Elon Musk when he urged Americans to vote Republican. Key reading: - [Trump Says He Will Make ‘Big Announcement’ on Nov. 15 in Florida]( - [Voting Lawsuits Soar Across US Before Midterm Elections]( - [McCarthy Warns GOP May Cut Back Ukraine Aid If Party Wins House]( - [Elon Musk Tells Twitter Followers to Vote for a Republican Congres]( - [Democrats Buoyed in Senate Races as Voters Split Tickets]( Governments around the world will parse the results for clues on how US policy in the near term and the 2024 presidential race might play out. Depending on the hard numbers (i.e. if there is no clear majority for either party in the Senate), it will limit the room for proactive policy-making and likely lead to muddled responses to economic headwinds, even if Biden leans on issuing executive orders. US economic weakness (alongside dollar volatility) has instant global impact. A Republican-dominated Congress may object to further large-scale financial aid for Ukraine. It could mean an even harder line on China, with the use of trade and tech regulation as behavioral tools. That in turn risks an even more confrontational multi-polar landscape, especially if Republicans and Democrats vie to be the most strident on China in the run-up to the presidential vote. Donald Trump may look to jump-start another presidential campaign off the back of the midterms if the Republican candidates he’s supported fare well. And that in turn could prompt Biden to announce he will run for re-election. If Biden focuses on countering Trump, does that leave less room for matters abroad? Or if Biden is unable to enact much of a domestic agenda between now and 2024, does he wade increasingly into foreign affairs to try and show he is achieving something? Much of the world is waiting for the answers. — [Rosalind Mathieson]( Biden and former President Barack Obama arrive at a rally in Philadelphia on Saturday. Photographer: Michelle Gustafson/Bloomberg Click [here]( to follow Bloomberg Politics on Facebook and if you’re enjoying this newsletter, click [here]( to sign up for Balance of Power. Global Headlines Election showdown | A deeply [divided]( US electorate will decide control of the Congress and state capitals today, delivering a verdict on whether Democrats or Republicans are best to guide the nation through a bout of inflation, a looming recession and bitter splits on cultural and social issues. Yet as [Mike Dorning]( and [Akayla Gardner]( explain, two politicians with the most at stake aren’t on the ballot: Biden and Trump, who suggested yesterday he would announce his third presidential run next week. Trump at a rally in Vandalia, Ohio, yesterday. Photographer: Joshua A. Bickel/Bloomberg US Midterms latest - [Biden Says House ‘Tougher’ to Keep Than Senate on Election Eve]( - [Pelosi Says Attack on Husband Will Be Factor in Her Future Plans]( - [Inflation-Focused Voters Defy Biden’s Bid to Change the Subject]( Ripple effects | While bills will soar, Europe has bought enough oil and gas to survive the winter. Much higher costs will be borne by the world’s poorest countries, which have been [shut out]( of the natural gas market by Europe’s suddenly ravenous demand. The most likely consequences — factory shutdowns, more frequent and longer power shortages, the foment of social unrest — could stretch into the next decade. - The European Union’s executive [signaled]( it doesn’t see a price cap on imported natural gas as the best tool to rein in the unprecedented energy crisis. Pessimism about China’s banking sector has reached an unprecedented level, even [approaching]( the depths where US banks traded during the 2008 financial crisis. While Chinese banks are far from the same perils that American lenders faced, the swoon reflects both a broad market selloff and growing concerns about bad debt as lenders have been called on to backstop the flagging economy. Toxic gas | The EU and US declared methane a threat to Paris Agreement temperature goals at last year’s climate summit and insisted emissions of it must be slashed 30% by 2030. Since then, more than 120 countries have signed up to a formal methane-cutting pledge and many will announce [action plans]( at COP27 in Egypt this week. The moves represent a collective effort to go after a greenhouse gas that’s estimated to be 80 times more powerful than carbon dioxide at warming the atmosphere. - Click [here]( for updates on satellite images of methane releases around the world. - Follow our COP27 coverage [here](. Best of Bloomberg Opinion - [Twitter Layoffs Will Shrink Free Speech Globally: Mihir Sharma]( - [Republicans Can Rescue American Democracy: Jonathan Bernstein]( - [Austrian Economists Can Explain the Next Recession: Tyler Cowen]( NATO bargain | Sweden’s new leader is making [progress]( toward convincing Turkey he’s serious about meeting its demands in exchange for being let into NATO, sources say. Stockholm agreed to distance itself from Kurdish groups viewed as terrorists by Turkey, after earlier approving arms exports to the nation. The concessions come ahead of a planned meeting today between Prime Minister Ulf Kristersson and Turkish President Recep Tayyip Erdogan. - Follow our rolling coverage of Russia’s war in Ukraine [here](. Explainers you can use - [Is the 1.5C Warming Goal Dead? COP27 and Climate Overshoot]( - [The Two-Year Conflict That’s Torn Ethiopia Apart]( - [The State-by-State Battle Over Abortion in the US]( Past powers | A party that overshadowed Ethiopian politics for almost three decades is now a [spent force]( after agreeing a peace deal to end a two-year war against federal troops. Commanders from the Tigray People’s Liberation Front, which dominated the Horn of Africa nation until 2018, started meeting with federal army leaders yesterday to disarm its fighters. The pact was sealed as Ethiopian soldiers were converging on Tigray’s regional capital, Mekelle. Bloomberg TV and Radio air Balance of Power with [David Westin]( on weekdays from 12 to 1pm ET, with a second hour on Bloomberg Radio from 1 to 2pm ET. You can watch and listen on Bloomberg channels and online [here](. News to Note - Biden and Chinese President Xi Jinping [will attend]( the Group of 20 Summit in Bali next week, this year’s host Indonesia said. - China’s air force stepped up [incursions]( into sensitive areas near Taiwan to the highest level since US House Speaker Nancy Pelosi’s visit three months ago. - Brazilian President-elect Luiz Inacio Lula da Silva delayed the announcement of a multibillion-dollar [spending plan]( as his team continues to discuss ways to pay for his main campaign pledges. - Former Pakistani Prime Minister Imran Khan [rejected]( a police report on the shooting last week that left him wounded because it doesn’t name those in government and the military that he blames for the attack. - North Korea denied [US allegations]( it was selling arms to Russia for use in Ukraine, amid concern Pyongyang may be moving closer to Moscow as it faces criticism from Washington over its weapons tests. - The EU is preparing to impose [further sanctions]( against Iran over a deadly crackdown on protests triggered by the death of a young Iranian woman, sources say. Thanks to the 32 people who answered yesterday’s quiz and congratulations to Francis Keller, who was the first to name Pakistan’s Khan as the former prime minister who was shot and injured during a rally last week. And finally … As the Chinese Communist Party’s top boss in Shanghai, Li Qiang has been an outspoken advocate for private businesses. But he was also the driving force behind the Covid-related lockdown that earlier this year put the brakes on economic activity in mainland China’s biggest financial hub. Now he’s been [catapulted]( into the party’s No. 2 slot behind Xi and all eyes are on how he might shape national policy as the world’s second-largest economy navigates an array of challenges. Li Qiang at the Great Hall of the People in Beijing on Oct. 23. Photo: Bloomberg Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. 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