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2014 Is On Track To Become The Second Biggest Year For M&A In History

M&A activity has hit $750 billion through June, a level we haven't seen in years, thanks to cash-flush corporations, steadily improving growth, and rising CEO confidence, according to Goldman Sachs's David Kostin.

This is up by around 50% from a year ago.

"If deal-making continues at the current trend, full-year 2014 domestic M&A announcements would reach $1.5 trillion, the second-highest level in history, trailing only the LBO-fueled peak of 2007," he wrote.

Kostin highlights two notable that differentiate this boom from previous ones: financial sponsors like private equity firms account for just 6% of deals vs. 11% over the past decade, and the average bid premium is down to 26% vs. 44% in 2009 amid higher share prices. Here's why that's unusual:

For context, at the peak of the LBO boom in 2006 and 2007, private equity accounted for 20%-25% of annual US M&A volume. Ironically, private equity funds currently have significant buying capacity and debt markets are extremely favorable. However, public target company valuations are stretched suggesting forward returns are likely to be muted. This dynamic explains why strategic combinations have dominated 2014 merger volume and LBOs have accounted for a below-average market share.

Here's the chart showing the flurry of deals from S&P500 firms. BI's Jim Edwards believes we are now approaching "frothy" levels.

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People Do Not Trust Their Social Networks

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People Do Not Trust Their Social Networks

Trust is paramount to the success of online services since we rarely see the people behind the scenes, but according to a new mobile banking report by Monitise charted for us by Statista, people have little trust in social networks to take care of their personal data.

The chart breaks down consumers’ levels of trust for various online services in four different countries, including the U.S., UK, China, and Brazil. Of the various online services, consumers tended to trust their banks and financial institutions the most — likely because these services use multiple security safeguards to protect consumers’ info — while major retailers, Internet companies like Google and mobile tech companies like Apple had varying levels of trust in those countries. However, across the board, users found social networks to be the least trustworthy online entities.

In a related note, Facebook recently admitted to a massive secret experiment designed to purposefully manipulate the emotions of its users.

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