June 29th, 2009
Red Hat rumors sign of business as usual
The recent rumors of Oracle buying Red Hat are false, but are a good indication that business conditions are becoming normal again. (Picture from League City, Texas.)
The source of the rumor, according to our own Matt Asay, is Katherine Egbert, an analyst at Jefferies & Co. She’s trying to scare up some merger work, create some action in a slow market.
Both are healthy signs.
If brokers are fishing for merger work, it means there is capacity to do such work, and bankers have come in off the ledges they were on last fall. If action is seen as slow, that’s also good, because banking should be boring.
The substance of this particular rumor is stupid. Oracle has no need for Red Hat, since it has its own Linux business, and as Matt notes the open source buzz is in applications, not the operating system.
What we are seeing, generally, is an attempt to bring back the status quo, with highly-paid bankers and brokers controlling the economy and creating money out of paper.
That’s not happening, not because of regulation but because every recovery is different.
The next recovery will come from the work of companies like Red Hat or, more likely, from Red Hat’s customers, than from the financial services industry.
Dana Blankenhorn has been a business journalist for 30 years, a tech freelancer since 1983. You can follow Dana on Twitter. See his full profile and disclosure of his industry affiliations.
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