Washington Babylon — October 14, 2009, 8:21 am

The Wall Street Way

Fom Steven Pearlstein in the Washington Post :

Analysts at Goldman Sachs suggested Tuesday that, despite a 50 percent run-up in stock prices that has left the Dow Jones industrial average just shy of 10,000 and the S&P 500 selling at 20 times earnings, stocks are still cheap. In fact, according to Goldman, stocks are so cheap that corporations are going to start using all that cash on their balance sheets not for product development or marketing or some other productivity-enhancing investment, but for acquiring other companies.

In case you just fell off a turnip truck, you might think “Monetizing the M&A Revival” is serious research aimed at helping Goldman clients figure out how to profit from these uncertain times. The helpful analysts from Goldman even provided the names of companies they think are so underpriced that they are ripe for a takeover — companies like Devon Energy, AK Steel and Red Hat.

But those with any memory at all will probably recognize this report for what it really is: a marketing brochure for Goldman’s investment bankers, who are just itching to begin cranking up the old M&A machine and generating those big fees again. With deal flow, of course, comes an equally lucrative flow of new stock and bond issues to pay for all those ill-advised and overpriced acquisitions, along with increased volume on Goldman’s trading desk from speculators hoping to cash in on the latest takeover rumors.

Share
Single Page

More from Ken Silverstein:

From the November 2013 issue

Dirty South

The foul legacy of Louisiana oil

Perspective October 23, 2013, 8:00 am

On Brining and Dining

How pro-oil Louisiana politicians have shaped American environmental policy

Postcard October 16, 2013, 8:00 am

The Most Cajun Place on Earth

A trip to one of the properties at issue in Louisiana’s oil-pollution lawsuits 

Get access to 164 years of
Harper’s for only $39.99

United States Canada

CATEGORIES

THE CURRENT ISSUE

March 2015

A Sage in Harlem

= Subscribers only.
Sign in here.
Subscribe here.

The Man Stopped

= Subscribers only.
Sign in here.
Subscribe here.

The Spy Who Fired Me

= Subscribers only.
Sign in here.
Subscribe here.

Giving Up the Ghost

= Subscribers only.
Sign in here.
Subscribe here.

Invisible and Insidious

= Subscribers only.
Sign in here.
Subscribe here.

view Table Content

FEATURED ON HARPERS.ORG

Article
No Slant to the Sun·

= Subscribers only.
Sign in here.
Subscribe here.

“She didn’t speak the language, beyond “¿cuánto?” and “demasiado,” but that didn’t stop her. She wanted things. She wanted life, new experiences, a change in the routine.”
Photograph © Stuart Franklin/Magnum Photos
[Browsings]
Burn After Reading·

= Subscribers only.
Sign in here.
Subscribe here.

William Powell published The Anarchist Cookbook in 1971. He spent the next four decades fighting to take it out of print.
“The book has hovered like an awkward question on the rim of my consciousness for years.”
© JP Laffont/Sygma/Corbis
Article
The Fourth Branch·

= Subscribers only.
Sign in here.
Subscribe here.

“Both the United States and the Soviet Union saw student politics as a proxy battleground for their rivalry.”
Photograph © Gerald R. Brimacombe/The LIFE Images Collection/Getty Images
Article
The Spy Who Fired Me·

= Subscribers only.
Sign in here.
Subscribe here.

“In industry after industry, this data collection is part of an expensive, high-tech effort to squeeze every last drop of productivity from corporate workforces.”
Illustration by John Ritter
Article
Invisible and Insidious·

= Subscribers only.
Sign in here.
Subscribe here.

“Wherever we are, radiation finds and damages us, at best imperceptibly.”
Photograph © 2011 Massimo Mastrorillo and Donald Weber/VII

Number of U.S. congressional districts in which trade with China has produced more jobs than it has cost:

1

Young bilingual children who learned one language first are likelier than monolingual children and bilingual children who learned languages simultaneously to say that a dog adopted by owls will hoot.

An Oklahoma legislative committee voted to defund Advanced Placement U.S. History courses, accusing the curriculum of portraying the United States as “a nation of oppressors and exploiters.”

Subscribe to the Weekly Review newsletter. Don’t worry, we won’t sell your email address!

HARPER’S FINEST

Driving Mr. Albert

By

He could be one of a million beach-bound, black-socked Florida retirees, not the man who, by some odd happenstance of life, possesses the brain of Albert Einstein — literally cut it out of the dead scientist's head.

Subscribe Today