Dealmaking may have slowed during the summer as the credit crunch took private equity out of the game but thanks to a global glut of cash, that lull is unlikely to last.
On Monday a Beijing-based bank made its first buyout abroad agreeing to take a sizable stake in California's UCBH Holdings. For China, there's $200 billion more where that came from.
And it's not just the East but the Middle East that's awash in cash with Borse Dubai's bid for Nordic exchange OMX just one sign of deals to come.
Here at home, corporate juggernauts such as Microsoft are sitting on wads of cash. As the dollar's value dwindles and the clock ticks on George Bush's merger-friendly government, they're getting ready to make a deal before it's too late.
So what's the trade as the handshaking on Wall Street picks up again?
Robert Teitelman, Editor-In-Chief, The Deal LLCjoins the panel for this conversation. Following are excerpts from the conversation.
Are the drivers as real as the reporting suggests?
"No," says Teitelman.
“There are still a lot of issues out there. Financing issues, private equity is still on the sidelines.. and there’s still a lot of risk averseness among corporations,” says Teitelman.
So you’re not getting hopped up on China?
“Not yet,” he replies.
Pete Najarian says options activity suggests to him that multi-billion dollar deals are happening. What do you make of that, Robert?
“It’s all relative to what we just went through. We went through a year or two of incredible deal making and you get used to that,” replies Teitelman. “Now suddenly you get an occasional $6 or $7 billion dollar deal… we used to get 10 or 15 a week."
He adds, “that doesn’t mean it isn’t going to come back.. but right now 'strategics' are just sitting there because they’re just afraid to do a big deal and that situation has not changed.”
What about foreign investors?
“Most of China’s money is going back into China this year… there’s also a political problem with Chinese deals.”
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Trader disclosure: On Oct 8, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Najarian Owns (VCLK), Najarian Owns (GOOG) Calls: Seygem Asset Management Owns (AA), (AAPL), (EEM), (GLD), (MSFT), (TIE), (CX), (ITU): Stacey Gilbert Is Chief Options Strategist For Susquehanna Financial Group, LLLP; Gilbert Is Head Of Market Intelligence Research For Susquehanna Financial Group, LLLP; Gilbert Does Not Cover Individual Securities But Does Recommend Trading Strategies; Gilbert Owns (TIE); Susquehanna Financial Group Owns More Than 1% Of (AAPL), (AKS), (BSC), (FCX), (GOOG), (GRMN), (NYX), (PALM), (RIMM); Susquehanna Financial Group Is A Market Maker In (AAPL), (AMZN), (BOBJ), (CSCO), (CTCM), (CETV), (EEM), (EWZ), (EWH), (FXI), (GOOG), (GLD), (GRMN), (MSFT), (PALM), (RIMM), (TRMB), (TLAB), (YHOO)