So, what’s the big deal about M & A’s anyway?
Mergers & Acquisitions have traditionally been linked to investor confidence in the market, directly leading to more money going into the stock market. M & A activity has been very low since the recession began as CEOs are unwilling to take big risks, instead holding on to cash assets.
So, let’s take a look at some previous cycles of M & A Activity and how they corresponded to the stock market:
The Economy Stinks
Let’s face it guys – the economy is not really recovering. Sure, Dow Jones was up for like 9 straight weeks (before yesterday’s selling Bonanza) and some economic indicators were pointing to recovery, but has there really been a change in consumer spending, unemployment and easing of credit? The answer is a loud no.
In this article, I will prove to you that no matter what you hear – we are still in a recession and have not started to recover. Usual economic graphs would have a bottom. In this case, our bottom is a plateau. The same is true around the world. There is way too much uncertainty, risk factors, and negative reports to leave any hope of recovering from the worldwide economic downturn.
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