I am just quoting Barry Ritholtz who wrote the following yesterday, and it is both prescient and depressing:

Don’t just risk your company, risk the entire world of Finance. Modest incompetence is insufficient — if you merely destroy your own company, you won’t get rescued. You have to threaten to bring down the entire global financial system. The fear and disruption caused by a Bear collapse is why it was saved. (AIG has the right idea on this).

Sorry Lehman (LEH), you are actually good enough to be bankrupt. AIG's Financial Product Unit, is so incompetent that it was able to save the whole firm. God, is this confusing or what?   read more »

Barclays is nearing a deal to buy Lehman Brothers (LEH) the venerable investment bank for $2Bn. That's smart money being invested with perfect timing. The deal would entail that Barclays buy LEH US investment banking operations in the US, in addition to LEH's headquarters in Mid-town which constitutes 1 million square meters of office building, and two data centers in NJ. The rest of LEH, will go to the spa (Chapter 11) , as my friend A. El Hamamsy would say, and emerge in a couple of years fit and slim.

That $2Bn is, in my very humble opinion, a cheap price tag to buy such a franchise, in addition to unreplacable real estate in Midtown, client list to die for, and a good workforce. 

Let's see how is that going to unfold. 

Yahoo! today announced the start of the (yet another) latest strategy to disrupt Google: Build Your Own Search Service (BOSS). Ok, the idea is neat, Yahoo would allow you to use their underlying technology and are hoping for the long tail effect to increase dramaticaly the revenue ads. The long tail, The long tail, The long tail. This is the strategy that is shaping the internet!

Neat idea, I wonder about it is going to pick up. Google please buy Yahoo! before they get ruined from Microsoft. 

Global markets are officialy in bear markets thanks to a myriad of negative events. Soaring oil and food prices, credit crunch in the US and to a lesser extent Europe,...etc

This weeks bloodshed hit the venerable Freddie Mac and Fannie Mae the hardest. Their stocks are down almost 75% off their highs. Before, you think of profiteering from their decline or bet on a government (likely) bailout, consider the following.  read more »

Three news of private equity deals were annouced today that involved Arab states' Wealth Funds. That excess wealth is of course a result of $2 extra billion a day Arab states are making. Simple math suggest that the extra amount represents almost $750 Bn a year. If oil reaches $200 / barrel, that would turn the extra gains into closer to $ 1.250 Trillion! Anyhow, the following are the deals reported in WSJ's Deals: 

Dow Chemical: The chemical maker agreed to buy coatings and electronic-materials company Rohm and Haas in an all-cash deal valued at $15.3 billion, signaling a possible consolidation wave in the chemicals industry. Dow is offering a price of $78 a share, a 74% premium on the $44.83 that Rohm and Haas closed at on Wednesday. Berkshire Hathaway and the Kuwaiti Investment Authority are investing in the deal.   read more »

Firefox has finally beaten a world record of most downloads in 24 hours. This is significant because, Firefox is managed by the Mozilla foundation, an NFP organization versus the billions that Microsoft spends on IE and still achieved a 20% market share. Second, Firefox is an open source application and yet it is more secure, better built, better managed then IE. This should put down to rest that if the code is available (open) it automatically means that it is less secure. It is weird how MSFT's IE is more vulnerable to attacks while being closed.

Bravo Mozilla and bravo AOL TimeWarner for allowing the browser to be open source. Yes, it makes commercial sense :-)

Private Equity managers should be rejoicing this week at the favourable ruling the Canadian court handed them over. This past week, the court has paved the way of the largest LBO deal to date with the acquisition of Bell Canada by a group of investors led by the Ontario Teachers’ Pension Plan and its partners, including Providence Equity Partners and Madison Dearborn Partners.

What does it this mean? Well, hopefully an ease in the credit crunch that has plagued the PE industry last year! 

NYTimes article announced the following

The Blackstone Group said Thursday that it has agreed to buy Apria Healthcare Group, a home healthcare services provider, for $1.6 billion, in the private equity giant’s first major leveraged buyout this year.

Nothing different about that idea. It is neither relatively large nor contreversial. The timing of the deal is interesting as it signals a certain relief in the debt market that things might be picking up. LBO is back!