The beauty of inter-connected markets, the theory goes, is that investors can add or remove money from local economies and follow the bull markets, wherever they might be.
When Brazil is hot, investors can place their money there and samba their hearts out.
When China is booming, guess what… the money will be headed East and dining on General Tao.
But what happens the US takes a hit?
The entire world falls apart.
Where do you go when America gets toppled?
Here’s what I think, there is way too much money on the sidelines; capitalism’s invisible hand will prevail.
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WatchMojo NewsletterHouseValues Invests $2.75M In ActiveRain. I don’t know either companies (an indication of my ignorance and not the level of success or potential of either firm).
But, expect more of this:
- HouseValues is a successful company that is sitting on cash, they’ll invest it in a strategic opportunity.
- Niche social networking sites make a lot of sense, and instead of pushing the greed envelope and getting VC money, ActiveRain is raising money from a company that can validate its model and accelerate its business plan.
With the credit and housing markets in the US under attack, I can imagine that raising money from money-men was a challenge, so looking to strategic money makes sense for Active Rain. Alternatively, in a lukewarm housing market, it makes sense for HouseValues to bring a potential competitor on-line by investing in them.
This is as win-win of a deal as you can get. Executing is a different story… and sometimes these deals don’t work out… but guess what, VC-funded deals have a higher propensity to go bust.
As global advertising powerhouse WPP continues to shift operations to the digital side of things, Sir Martin Sorrell is targeting Montreal-based ad agency Nurun. I’ve worked with Nurun in the past and it has an impressive client list and made a name with notable marketers.
Nurun is actually owned partially by Quebecor Media, whose sisted company Quebecor World is about to be eating away by a major private equity investor or a competitor as plans for a $400M credit facility fell through at the last second.
The credit markets are changing before our eyes, that is for sure, but that is a short-term change as a result of loose credit excess last year.
What is undergoing a more significant shift is the media world: it’s going digital, and Quebecor’s troubling times over at its printing unit - while digital thrives - speak volumes.
In other words, WPP is willing to pay more for Nurun’s shares under any terms Quebecor Media wishes… but Quebecor World cannot give itself away (proverbially speaking).
Quebecor World was once the world’s largest commercial printer, printing magazines like Fortune and many others.
Disclaimer: Quebecor Media’s Canoe.ca is one of WatchMojo.com’s 100 or so distribution partners. I forgot to add this initially…
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