Local Group galaxies emerge from the dark

The "Lambda Cold Dark Matter" (LCDM) model of cosmic structure formation is eminently falsifiable: once its parameters are fixed on large scales, it becomes testable in the nearby Universe. Observations within our Local Group of galaxies, including the satellite populations of the Milky Way and Andromeda, appear to contradict LCDM predictions: there are far fewer satellite galaxies than dark matter halos (the "missing satellites" problem), galaxies seem to avoid the largest substructures (the "too big to fail" problem), and the brightest satellites appear to orbit their host galaxies on a thin plane (the "planes of satellites" problem). We present results from the first hydrodynamic simulations of the Local Group that match the observed abundance of galaxies. We find that when baryonic and dark matter are followed simultaneously in the context of a realistic galaxy formation model, all three "problems" are resolved within the LCDM paradigm.