How to Profit from the Bear Stearns Deal
March 17, 2008
So Bear Stearns is about to get sold for a “paltry” 236 million dollars. That’s down from a value of about $20 billion only a year ago.
Now before we go any farther… let it be known that I’m no financial expert. So please don’t take this as investment advice to go out and buy up JP Morgan shares.
This is a marketing and business letter after all.
So my financial “analysis” here (if you can even call it that) is just to illustrate a larger idea… it’s extremely oversimplified. You’ve been warned. 
BUT…
When I see something like the Bear Stearns deal go down, it’s not my financial ears that perk up, it’s my business ears that pay attention.
So in this case, JP Morgan is about to purchase a (struggling) billion dollar business for peanuts.
JP Morgan is the face on the deal, but the government is behind them every step of the way.
So they’re acquiring Bear Stearns for $2 per share with their risk backed by Uncle Sam. Their risk is virtually zippo.
Sure there are possible future pitfalls. But all in all, kind of an amazing turn of events.
Plus… provided the big wigs in charge can push the sale past angry shareholders (who are about to get the shaft and could get more return on their investment simply by putting a FOR SALE sign on the Bear Stearns building in Manhattan…), JP Morgan will enter the prime brokerage business overnight. And they’ll walk away with a prime brokerage business that’s about DOUBLE the size of Bank of America.
Not bad for a weekend’s worth of negotiations…
So what does all this mean?
It’s just one more example of how someone ALWAYS thrives in turbulent times.
Why shouldn’t it be you and your business?
Here are some ideas about how to turn all of this turbulence to your advantage:
1. Trouble in the market gives you an unending supply of TIMELY “hooks” to use in your marketing to capture the attention of your market. How can you use this “f*ree” material to get more attention for YOUR products and services?
2. Trouble in the market creates opportunities others will be too scared to see. While everyone else is pulling back, standing on the sidelines, waiting to see what the other guy’s going to do, the action takers swoop in and capture opportunities that might have been pipedreams in other circumstances (just take a look at JP Morgan… they’re about to get a multi-billion dollar business practically for f*ree.) How do you spot the opportunities? You just have to look at things differently. Don’t look at things and accept what everyone else is saying about them. Look at them and ask, “How can I use this to my advantage?”
3. Times of trouble give you and your business the opportunity to stand up and lead. People want to be led. They want advice about how to deal with the problems. And if you can help them, then why not march up to the front and start leading? Do you think that might be valuable to your customers, clients and prospects? Just think what that could do for your positioning in the marketplace?
4. Times of trouble make it easy for you to stand out… especially if you’re preaching something OTHER than the doom and gloom that most people are getting in the media. There’s always hope… there’s always a way out… there’s ALWAYS someone thriving in the midst of chaos. Start talking about THAT and your business is going to stick out like a sore thumb. In good times, you invest a lot of money in marketing and advertising to do just that.
Apparently, things might just get “worse” before they get better. But is that a reason you and your business shouldn’t prosper anyway?
I don’t think so. Good luck.
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