What's going on?

Investment banks have been raking in record fees this year, as they do whatever they can to find each and every company its perfect match.

What does this mean?

Investment banks make their money in all sorts of ways, but one of the biggest is by advising on mergers and acquisitions (M&A). And what a year for dealmaking it�s been, with a record-breaking $4.3 trillion worth of deals struck in the first nine months of the year � twice what it was this time last year. That�s not especially surprising: rock-bottom interest rates have made borrowing cheap and sky-high stock prices have made raising funds easy, all while firms scramble to find new ways to one-up the competition. It�s certainly paid off for investment banks: they�ve made 46% more in M&A fees than they did last year.

Why should I care?

For markets: Private equity isn�t so private after all.

Investment banks make big money from initial public offerings too, which might be why they�re currently sniffing around the private equity (PE) industry. PE firms � which buy businesses and spruce them up before selling them for profit � have been responsible for 30% of deals this year, and retail investors are keen to get a slice of the potential profits. Investment banks, then, have been trying to persuade those PE firms to debut on the stock market � with their help, of course.

The bigger picture: Five9 hangs up on Zoom.

Zoom�s been striking deals of its own: it�s been trying to expand its product offering now that no one�s relying on digital coffees any more. The pandemic favorite announced in July that it�d be buying cloud-based software provider Five9, and that it�d pay for it using shares rather than cash. But investors have sent its stock down 28% since the deal was first struck, and Five9 � whose payday suddenly looked a whole lot less lucrative � called the whole thing off late last week.