M&A Speculation is now the biggest bubble ever – what happens when like real estate or dot com its bursts?
Peter Oberois
May 9, 2007

The stock market will not find much bottom when the M&A bubble will burst. In the last 46 trading days, the market was up 43 days. It is unprecedented since 1927. You know what happened the euphoria was finally over in 1929!

The M&A bubble has gone out of control. The frenzy of buying each other out is creating a bubble of mega proportion.

Asian stocks rose to a record, led by mining companies and steel makers, on expectations this year's record pace of takeovers will be sustained.

An analytic model that tracks M&A activities, market sentiment indicators and smart money accumulation as well as distribution patters has turned bearish again. It has turned far more bearish than that in January.

M&A bubbles are the root cause of bear markets in stocks if you look at the history. This time hedge funds are actually finding these deals. That is even more dangerous. The leveraged deals are the name of the game. It is worse than sub prime loan disaster and interest only mortgage loans.

It is time for a one-year arm mortgage again – Fed will lower rates to zero percent by end of 2010
Sam Adelton
The Fed like its counterpart Bank of Japan will lower rates and keep rates at zero percent from end of 2010 to 2030. The economy will face severe deflation, stagnation and in some cases severe recessions.
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Chinese Central Bank getting ready for a massive squeeze on the liquidity and huge rate rise – the effect on the world stock markets
Peter Oberois
. Steel, copper and other industrial materials will collapse in price. So will the world stock markets. The Great Depression is going to come from the east this time.
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Toyota earnings anatomy - Auto market in Japan shows that the Asian economic giant will lead the world in deflation and economic recession
Alan Hershey
Something interesting revealed from the Toyota earnings results. The automaker posted a handsome 8.9% rise in quarterly net profit with higher sales in the U.S. and Europe. But the sales in Japan was clearly stagnating and actually deflating.
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Housing market going through an interesting period of adjustment – bubbly regions experiencing price collapse while prices rising in areas that missed out on the boom
Mike Moran
Builders are facing two edged swords. First, the demand is collapsing as the bubble bursts. People are now totally weary about jumping into big mortgage based home buying. On the other hand the commodity (especially copper) prices are way up there.
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Fed can surprise all with a preemptive rate cut or a strong statement towards its worry for stagnating economy
Marla Guthrie
If a rate cut comes, stocks and bonds will rejoice. But the stock market jubilation will be temporary as the reality sets in that the economy is after all in trouble and corporate profit at the end of the year is in real question.
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M&A Speculation is now the biggest bubble ever – what happens when like real estate or dot com its bursts?
Peter Oberois
The stock market will not find much bottom when the M&A bubble will burst. In the last 46 trading days, the market was up 43 days. It is unprecedented since 1927. You know what happened the euphoria was finally over in 1929!
READ MORE>>

Oil headed for a $40 a barrel – gasoline headed for $1,50 a gallon because of lack of demand and excess supplies
Marla Guthrie
In the past whenever the gas station in April-May showed resiliency is lowering gas prices as crude prices dropped, the gasoline prices tumbled in June-September. Expect the same this year in a higher scale.
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