The market is fickle. Chasing yesterday’s winners is not often rewarded, even if the underlying business conditions support much higher valuations. And besides, there are wealth-management stocks to buy! “U.S. investment bank Lehman Brothers (NYSE: LEH) has agreed to buy Australian brokerage Grange Securities to tap into a boom in corporate activity in the region, and as part of a wider plan to expand aggressively in Asia,” wire service stories report this morning.
As we pointed out last week, it’s a good time to be selling stocks, even if it may not be the best time to buy them, right here at the top, where the view is excellent and we’ve some so high.
“Lehman said it wanted to be one of the top five investment banks in Australia within five years, taking on rivals such as Goldman Sachs (NYSE: GS), by expanding Grange’s fixed-income, wealth management and investment banking business. ‘This acquisition is about setting up a beach-head and we will play in the next five years or so a dominant role in expanding that product offering,’ Lehman’s Asia Chief Executive Jesse Bhattal told reporters in Sydney.”
And here we thought the invasion to watch for would come from Asian money on the northwest beaches. It turns out its Americans just like us we should have been on high alert for, come to slice away some of the commissions and fees enjoyed exclusively up to now by very self-satisfied Australian firms. This will be interesting to watch.