Thursday, September 13, 2007

The Dead Deal Dance

One of my friends and former colleagues used to talk about doing the "dead deal dance" when certain deals died, usually for good reasons. Reading this story about market conditions reminded me of the dead deal dance.

I have to admit I have never seen a lender pull out of a deal while documents were in transit to the escrow agent. Hopefully I never will. But what I read from this story, somewhat between the lines, is as follows: (1) people are getting their arms around what is going on and realizing this is a short term crunch, with ice already breaking if it ever existed; (2) lawyers are not sitting on their posteriors doing nothing -- there is either slower, normal deal flow or other types of deals such as workouts going on; and (3) lenders are going back to the traditional Golden Rule: those who ave the gold make the rules.