Mergers and Acquisitions Boom Blossoms in May

Merge…acquire…buy…sell…deals, deals, and more deals. This month of May will see more new buyout deals bloom than any month in history. It is like the Chelsea Flower show! Buyouts so far this month total some US$82 billion. This is the ‘hottest month’ of deal making ever.

“Is deal frenzy nearing end?” asks the Wall Street Journal.

We don’t know. But we also read that the US money supply is still expanding at a 14% annual rate – six times faster than GDP. All that moolah has to go somewhere. For the moment, it’s going into deals. And the deal makers – such as über-dealer Goldman Sachs (NYSE:GS) – are making big, big money. Goldman’s shares have gone up three times in the last five years.

And here comes a report that investors are more confident than anytime in the last five years. But at the same time, a lot of seasoned investors are beginning to speculate on the downside. The street hasn’t seen so much short selling since 1931. Normally, people sell short at the beginning of a bull market. Prices rise and they expect them to come right back down again. But now we have a huge increase in short selling after the stock market has been running wild.

What to make of it? Again, we don’t know…maybe it really is a new era….

Bill Bonner
Markets and Money

When will the M&A boom end? Leave a comment below.

Bill Bonner

Bill Bonner

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind Markets and Money.
Bill Bonner

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