Big can failThere is no smoke without fire

When the road is difficult, is not on the vehicle the more sexy that it takes but on the most secure. While the chemistry of specialties (painting, dyeing, plastics...) sees its margins rolled by the rise in the price of oil, chemists at base, a priori the less profitable, derive their PIN of the game, their rates more aligned oil prices. BASF, the first of them, chose the ideal time to do her shopping in good balance by throwing his vest on Ciba. At 3.8 billion euros, or a premium of 32 over the last side price of the Swiss group, offer seems generous. It may yet little to heal the wounds of the shareholders, who have seen their titles fall by 75 since 1997, date at which the pharmacist Novartis had cut the lines with its chemical activities. But investors know that they have little choice both Ciba and dropped, never found the winning formula, mired in niche areas subjected to too much competition so that it can impose its prices. Their leaves to hope that a new mentor will be able to help him find his way. Even if the difficulties faced by the sector suggest that the integration will be painful.

The mother of mergers

The best magic tricks are those who know how to focus the attention of the audience on a decoy while the bulk of the trick takes place elsewhere. When Kenneth Lewis, the pattern of Bank of America, pulled out of his hat acquisition surprised Merrill Lynch instead of Lehman Brothers, fellow Wall Street had to make clear that they lack of vigilance during the mad of last weekend's Waltz. Kick master or blood blow It is too early to categorize this new round of sleight of the first American Bank, which had already been disappearing into his sleeve, in January, the real estate lender Countrywide distressed. However, with regard to the price as the risks, realities outweigh the illusion. BoA buys, valorization of four years and half cheaper than its highest in early 2007, one of Wall Street banks which has the highest proportion of its revenues from asset management, a still solid trade. But, with more than $ 110 billion of toxic assets to 172 billion of own funds, the new package will have to find money. After 70 billion of acquisitions since 2005, the "Mother Merrill" for a 40 billion promises to be the "mother of all mergers" for BoA.

Big can fail

There is no smoke without fire. Financiers sometimes tend to forget. Just six months ago, Lehman Brothers was the subject of fear and no saw in him a power Bear Stearns. But its leaders wanted reassuring about its financial health and Wall Street still valued the fourth US 25 investment bank billions of dollars. Citigroup considered it even dumped 8 billion! The Cassandras were reason and Lehman has even taken the "chance", as Bear Stearns, to find a buyer buying up its shares at broken prices. If American are the first lodges of the bankruptcy, some European banks too optimistic or reckless will leave feathers. By fall Société Générale, Dexia, Credit Agricole SA, AXA and BNP Paribas from 8 to 11 yesterday, investors have clearly expressed their legitimate concern. Because the "too big to fail" setting from the bankruptcy of the establishments protected by the enormity of their size has more courses. Despite its 600 billion of assets, Lehman has been abandoned to its sad fate. If the 250 million euros for exposure of BNP Paribas are bearable with its 3.5 billion of half-yearly profits, 500 millions of Dexia weigh heavier face a result declined to 821 million. And if the 7.2 of the capital held by AXA for account of third parties do not weigh on its balance sheet, they are likely to weigh on its image manager providing the financial protection of its customers.