I'm still learning about this whole industry and there's something that I'm not quite understanding with this article on bloomberg, http://www.bloomberg.com/apps/news?pid=20601087&si...
In the second to last paragraph it says this,
" First-quarter U.S. mergers and acquisitions fell 61 percent from a year earlier to $210.7 billion as a jump in credit costs deterred buyers, according to data compiled by Bloomberg. "
It says that M&A activity fell because of the jump in credit costs? I thought that because of the whole credit crunch, interest rates are as low as they've been in a while (discount rate is at 2%) and that the Fed and Bernanke has allowed Ibanks to borrow up to $200 billion against the risk-free T-bonds they get in exchange for AAA mortgage bonds?
If in the 1Q they faced interest rates of 2% and 28 days to repay $200 billion essentially, how has there been a "jump in credit costs"?
Can someone explain to me what I'm leaving out or not factoring in?