Animal Spirits Need Paperwork, Not Just Appetite
In 2025, Wall Street’s “animal spirits” didn’t just roar back. They were given paperwork, permissions, and a green light. Global mergers and acquisitions worth $10bn or more hit a record 63 deals, a surge powered by a specific cocktail: Trump-era deregulation, fading trade-war risks, cheap money, and a regulatory stance that treated consolidation as efficiency rather than concentration.
The architecture for the animal spirits was built through executive orders like EO 14192 and a suite of rollbacks that weakened antitrust standards, loosened financial oversight, and signaled to markets that the roadblocks to very large deals had been deliberately removed.
Choreography — EO 14192 and the New Threshold for “Too Big”
On January 31, 2025, Executive Order 14192—“Unleashing Prosperity Through Deregulation”—instructed federal agencies to review and repeal regulations “burdensome to growth.” Antitrust guidelines were softened. Cross-border reporting requirements were eased. Sectoral rulebooks—especially in finance, energy, and technology—were rewritten with a presumption in favor of scale.
Financial Services Deregulation Act loosened capital rules and scrutiny for bank consolidation. Technology Innovation & Competition order shifted merger review toward a narrow test of “clear consumer harm,” making it harder to block deals on structural or long-term competition grounds. Energy & Infrastructure deregulation package streamlined approvals and shortened review windows.
The message to boardrooms was simple: if you can finance it, you can probably close it.
Case Study Field — Finance & Industrials in the New Regime
Within this new choreography, finance and industrials became test beds for the deregulated scale model. Three emblematic deals tell the story:
- Sealed Air’s $10.3bn buyout by CD&R;
- the consolidation of Provident Bancorp into Nb Bancorp; and
- HarborOne Bancorp’s merger with Eastern Bankshares.
The language in investor decks was familiar: synergy, optimization, efficiency, modernization. On paper, all of these are good words. The question is who pockets the fuel savings.
Consumer Lens — Stability Without Affordability
From the consumer side, the finance and industrials megadeals deliver something real: service stability and operational reliability. When regional banks merge, customers often gain access to a larger ATM network, improved mobile apps, and more standardized services across geographies.
When an industrial distributor scales up, supply chain disruptions for packaged goods can decrease, reducing the risk of empty shelves and sudden availability shocks. These are not illusions; they are concrete. But they are not the same as affordability.
In banking, account maintenance fees, overdraft charges, and lending spreads tend to remain sticky. Even if the merged entity reduces its cost base by closing overlapping branches or consolidating IT systems, there is no automatic mechanism forcing those savings into lower fees for households.
In industrials, procurement scale may lower input costs for packaging and materials, but consumer prices for the goods inside those packages are influenced by brand strategy, retail dynamics, and competitive pressure. Without regulatory insistence on pass-through, the savings stabilize margins instead of household budgets.
Investor Lens — Margin Expansion as Design, Not Accident
For investors, the payoff is clearer and more quantifiable. In finance, regional bank mergers offer margin expansion through fee stickiness and spread capture. Costs fall as overlapping branches close, back-office functions consolidate, and duplicate technology platforms are retired. Revenues remain supported by the same or greater customer base. The result is a lower cost-to-income ratio and improved return on equity.
In industrials, private equity-driven buyouts like Sealed Air’s emphasize procurement economies of scale, streamlined logistics, and operational “optimization” that often includes restructuring and headcount reduction.
The goal is not ambiguous: expand EBITDA (earnings before interest, taxes, depreciation, and amortization), stabilize cash flows, position the asset for an eventual exit or refinancing.
Investors track net interest margin, fee revenue trends, and synergy realization metrics; they are not tracking whether overdraft fees fell or packaged food prices eased.
Consumer & Investor Costs — The Hidden Price of Scale
The unpriced cost of deregulated megadeals in finance and industrials is subtle but cumulative.
- On the consumer side, the cost is a slow erosion of competitive pressure: fewer regional banks means fewer independent pricing decisions, fewer distinct fee structures, fewer alternatives for borrowers with thin credit files or small business needs.
- On the industrial side, a narrowing set of major suppliers can harden wholesale prices and limit bargaining power for smaller manufacturers and retailers—costs that ultimately flow into the consumer basket.
- On the investor side, the cost comes as tail risk: integration failures, political backlash, and the possibility that a new regulatory regime decides to reverse course, imposing stricter merger guidelines or windfall taxes on perceived excess profits. The deals that look safest under one administration can be re-interpreted as problematic under another.
Conclusion
Stability for households and profitability for shareholders are being decoupled — deal by deal, order by order. But in a deregulated megadeal era, efficiency should be a shared dividend, not a private asset. The test of policy is whether scale serves citizens as well as markets.
