All business runs on credit and access to credit is the one of the most important aspects to a good functioning economy. The controllers of credit tend to be banks, and when they give loans to small businesses, the economy grows. When they slow down the use of credit, the economy slows down. It is important to know how the bankers see the economy, and one of the best methods is look at the results of the biggest banks in the country.

In an article from Reuters, Bank of America’s profit rose in the first quarter in the global markets as volatility in the global markets lifted trading activity and a rebound in mergers and acquisitions boosted investment banking fees.

Volatile markets tend to benefit investment banks, as trading desks generate higher revenues from increased client activity. BofA ‘s sales and trading revenue rose 13% to $6.4 billion in the first quarter.

Big transactions – specifically big technology M&A – dominated with 22 deals worth more than $10 billion each signed in the 3 months ending March 31, data complied by LSEG showed.

BofA Securities secured advisory roles included McCormick’s $42.7 billion acquisition of Unilever’s food business and Boston Scientific’s $14.9 billion purchase of medical device maker Penumbra. The bank advised on Devon Energy’s $26 billion takeover of Coterra Energy.

BofA’s total corporation investment banking fees rose 21% to $1.8 billion in the first quarter, they were expecting a 10% rise.

In a recent MSNBC video clip, Steve Liesman used BofA information which showed aggregate numbers that the bankers could see how the average American is doing with their banking for the US economy has moved into a K economy. Some are doing very well, others are suffering and BofA numbers reflect the trend.

Linking to dividend paying stocks, the trends you see in the news and reflected help some companies more than others. More M&A’s those fees help investment banking, because there are fees for the actual transaction and then there are fees for selling off assets or right sizing the company. When you examine the M&A do not see it from the consumer but the investor point of view, can you make money on the trends or if you own investments in the sector will they benefit from the trends? There are always trends in the economy, ideally they happen consistently which is why companies make money depending where the season and the cycle is. For example, more construction happens in the spring, summer and fall than the winter. Is it happening?

There are more questions than answers, till the next time – to raising questions.