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Nasdaq Jilted Again?

21

April, 2011

 

Poor Nasdaq.  Nobody wants to marry them.  They tried so hard a few years ago to get married to the London Stock Exchange but their advances were rejected and they were left at the altar.  Now, as they see their real love (the NYSE) being courted by the strong and powerful Deutsche Bourse, they are desperately trying to break up that courtship and swoop in to steal the bride.  But just like the LSE, the NYSE wants no part of the ugly, scraggly Nasdaq.  To try to prove themselves worthy to their potential bride, Nasdaq has flaunted that they have the dowry for the marriage.  They even said they would pay the bride $350 million if she accepted their advances but was later told the marriage was off because the Justice Department deemed it “anti-competitive”.  Nasdaq must be pretty confident that the Justice Department will give them a pass. The NYSE continues though to reject Nasdaq’s advances.  Are they just playing hard to get or are they just really in love with the Deutsche Bourse?  Either way, golden parachutes have already been handed out and the NYSE executives will be a winner.

 This pathetic romance is really just a distraction when you think about the Franken-market that has been created by the SEC over the past decade with their regulations that have had so many unintended consequences.  Nasdaq and NYSE want you to think that they are actually valuable companies with great earnings prospects.  They want you to think that these mergers are by choice and not necessity.  Well, just take a look at their stock prices over the past few years and it tells a different story. These exchanges have literally destroyed each other in their quest to keep their shareholders happy and their executives well paid.  They have sold out the investor and the small corporation looking to raise capital to the highest bidding high frequency trader.  Now they are scrambling for an exit and want you to believe that they are actually in demand.  They want the illusion to become a reality.  If Nasdaq’s past record is any indication of the future, they will once again be left at the altar as they watch the NYSE and Deutsche Bourse dance together.

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