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Monday Morning Quarterback

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It's been a busy weekend for investment bankers around the world as billions of bananas have traded in bunches.

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"It's not a question of enough, pal. It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another."
--Gordon Gekko, Wall Street


Good morning and welcome back to Let's Make a Deal! It's been a busy weekend for investment bankers around the world as billions of bananas have traded in bunches.

Just another Manic Monday? Yeah, you could say that, with Goldman and TPG coughing up $25 billion for Alltel, Italian banks UniCredit SpA and Banco Popolare di Milando plunking down $37 billion in Lira lassoes, Hologic merging with CYTYC in a $10 billion marriage and Beijing wiring $3 billion over to their new buddies at Blackstone.

Man, if purple is the new pink, 'billion' must be the new 'million,' staggering in size and comprehensive in scope. These deals are large and they're cumulative, adding to the record-setting pace of corporate consolidation.

Minyan Michael Santoli offered a stellar summation in this week's Barron's, offering that while we're certainly extended in the near-term, we've not yet reached the 'silly' phase of this M&A cycle. As he so eloquently scribed, "Looking for huge upside here involves riding the pendulum from the rational to the silly, without a clear idea of where the border lies."

That's a valid observation, albeit a tough nut to crack. For in a globalized economy, borders are amorphous.

In other Monday Morning Musings…

  • S&P 1527 is the obvious beacon in the night as the S&P attempts to play ketchup in the headline grabbin' daily Dow Wow Wow's. It's almost too obvious not to happen, although the banks, as it stands, have yet to confirm the squirm. That, along with market breadth (which has lagged in recent sessions) remain the flies in the upside try.

  • Does anyone else think that it's interesting that the pre-market futures are flat given the eye-popping weekend activity? As with any post-expiration Monday, understand that the true market tone likely won't arrive until we start eyeing the lunch menus.

  • Shrek the Third took in $122 million in its first weekend, breaking the franchise's own record for best debut ever for an animated film. That record should last for a while, or at least until Hoofy and Boo make their big screen debut.

  • Asia has overtaken continental Europe as the top investment option for investors living outside their country of origin. A year ago, continental Europe was the most popular region, followed by the United States, Asia and the UK (Internaxx). Shocker, given the 85% pop in Shanghai, right?

  • Speaking of which, Billionaire Lee Shau-kee, chairman of Henderson Land Development Co., said Chinese shares trading on mainland markets are at an "unreasonable'' premium to those in Hong Kong, threatening to create "a bubble.'' This is the third warning in as many days, following Merrill's China chairman and the richest man in the region.

  • There's a slew of new supply coming to market this week as bankers look to pay for their new summer Carreras. Expect liquidity to be thin as the week progresses and folks eye the official summer kick-off party.

  • If you haven't checked out our latest installment of Separated at Birth, start your week with a smile. They're awesome!

  • Television's JeffMacke®, MacroMaven Stephanie Pomboy and Minyan Michael Santoli just pinged to lemme know how jacked they are for Wednesday night's Miracle in Manhattan. This won't be a Critter's Choice Style Soiree (not many things are) but it is for a worthy cause and it's an opportunity to share hugs and handshakes with our community as we enter the summer.


    Join us for a "Miracle in Midtown"

    Wednesday May 23rd... benefiting charities including the Ruby Peck Foundation for Children's Education




Have a great week, Minyans, and we'll see you over on the Buzz!

R.P.

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No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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