An incoming ‘M&A supercycle’ wouldn’t just be a win for dealmakers

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In today’s big story, Goldman Sachs’ earnings result might be a sign of the long-awaited return of M&A.

What’s on deck:

But first, let’s (finally) make a deal.

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The big story

M&A for all

Don’t look now, but M&A might finally be coming back.

Predicting dealmaking’s return in the wake of the post-pandemic frenzy has been a bit like Bigfoot sightings: Plenty of claims but very little evidence.

But, at the risk of sounding like all the others, this time might be different.

Goldman Sachs, Wall Street’s perennial M&A king, smashed analysts’ third-quarter expectations, notching $3 billion in profits.

That included a 20% bump in investment banking fees to $1.9 billion, which points toward a dealmaking rebound, writes Business Insider’s Reed Alexander.

Granted, just about anything was bound to be an improvement over 2023’s ice age of an M&A environment, but there’s reason for optimism.

Bank CEO David Solomon said on the earnings call there is “significant pent-up demand from our clients.” The Fed’s rate cut last month “renewed optimism” that a soft landing is coming, which would spark more deals, he added.

One analyst took things a step further, floating the idea of an “M&A supercycle” once the money that’s been sitting on the sidelines finally gets put to work.

Bankers aren’t the only ones set to benefit from an M&A boom.

Just like consumers, many businesses have largely been dealing with a stuck-in-place economy.

High rates and an uncertain economy left companies in a holding pattern. You’re not likely to buy a new business or ramp up hiring when it seems like things can fall apart at any moment. But now that the worst appears behind us and rates are slowly coming down, the floodgates can open.

And it’s not just about the return of the $1 billion-plus mega deals that draw headlines. A more promising M&A environment means boomers will be willing to sell off the small businesses they spent their entire lives building.

The great boomer fire sale, as we dubbed it, is serious business, representing businesses worth about $10 trillion.

News brief

Top headlines

3 things in markets

1. The world’s governments have racked up quite the bill. Led by the US and China, global public debt is set to surpass $100 trillion, reaching about 93% of worldwide GDP. The International Monetary Fund warned that debt could lead to a “broader financial crisis.”
2. The stock market’s darlings take a hit. Chipmaker ASML cut its 2025 sales guidance, sending its stock tumbling and pulling down other semiconductor companies. It comes as the US considers putting a cap on chip exports.
3. Bitcoin might break another record before the US election. Standard Chartered said the token could hit a new all-time high of $73,800 in the coming weeks. It cited the recent surge in MicroStrategy, a bitcoin-focused stock that usually trades in lockstep with the asset, which could hint at a pending bitcoin rally.

3 things in tech

1. Apple has a new — er, old — competitor. Seventeen years after the debut of the first iPhone, Apple is struggling to get people excited about its newest models. Instead, consumers are turning to the secondhand market to buy refurbished smartphones. Apple should be worried.
2. The tide may be turning for the US’ big semiconductor bet. TSMC has begun producing A16 chips for Apple at one of its Phoenix semiconductor chip fabs (or factories), two people familiar with the matter told BI. This development bodes well for the future of the US semiconductor industry, to which the Biden administration pledged $52 billion.
3. Donald Trump weighs in on Google’s antitrust challenges. In an interview with Bloomberg, the former president said Google “has a lot of power” and he would do “something” about it, but didn’t say he favored a break-up. A ruling in August said Google illegally acted as a monopoly in its search business.

3 things in business

1. Elon Musk gave his pro-Trump PAC $75 million in 3 months. A new filing offers the clearest picture yet of how much the world’s richest man is willing to spend to get the former president re-elected. The billionaire has reportedly floated the idea of personally knocking on swing-state voters’ doors for Trump.
2. All the single ladies are voting for Kamala Harris. In just a few years, single women have become a largely united voting bloc, overwhelmingly supporting Democrats. Unmarried women now make up 25% of the electorate — and that’s bad news for Donald Trump.
3. Netflix’s new games boss is shaking things up. Alain Tascan, who became president of games in July, has brought in Jeet Shroff for a newly created role as a VP over games tech and portfolio development. Shroff, formerly of Epic Games, is charged with promoting consistency across Netflix’s portfolio of games, both licensed and homegrown.

In other news

What’s happening today

• Today’s earnings: Morgan Stanley, Discover Financial Services, and other companies are reporting.

The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Hallam Bullock, senior editor, in London. Milan Sehmbi, fellow, in London.