Where do they come from, ‘Friday rumours?’ Like this Friday’s special edition:
MKT RMR – BANK OF AMER FOR UBS – NOT CONFIRMED
We can’t find an answer on Wikipedia, or ask.com, or any of our usual top, top sources – even if we employ the American spelling. But let’s have a stab:
- Reduced liquidity. The long weekend is something to be cherished – even in financial markets – and it is so much better when the lengthened bit is at the beginning rather than at the end. No one wants to come out to play on a Monday. With fewer players directly in the game, the reduction in market liquidity accentuates any rumour-driven movement in prices. And hence profits, for the unscrupulous.
- Relaxed environment. Whether or not the boss has skipped off early, everything about a Friday points to a lowering of standards – the dress is down, the lunches are longer, the appetite for taking a risk is greater.
- Rabbity hacks trying to find a story to fill Sunday newspapers. Britain, in particular, has a culture of Sunday business supplements, supposedly filled with exclusive, price-moving news. What better way to end a tiring week than to tell a gullible journalist that you have heard Bank of America are running their rule over the hapless UBS? Yes, it would create a beast of a bank ($260bn), but you almost believe it could happen. And in any case, you can now tell your friends what the Sundays will be running.
There. That should do it. Stand by for the biggest financial deal of the modern age.