View / M&A is cleaning the decks for AI

As we close the books on 2025, here are two data points to consider: Gold hit a record high and corporate mergers came very close to one, with a few days left to go.

Gold is a classic doomsday asset. M&A tends to rise when executives feel good about the world. They shouldn’t travel together — and certainly not when interest rates are still relatively high, which makes dealmaking more expensive and non-yielding assets like precious metals less attractive.

My best attempt to square these milestones will — I’m sorry, I know it’s Christmas Eve Eve — be a bit of a bummer. M&A may be less of a purely bullish indicator than we think, particularly the mergers we’re seeing now, which are largely aimed at defending moats rather than building for the future.

It’s “endgame consolidating,” Goldman Sachs President John Waldron told me this spring, with the goal of each industry having “a few large players.” He blames (or credits, as Wall Street rakes in M&A fees) AI: “If you’re going to create a generative-AI rewiring of your business and take a lot of cost out, you’d rather do it on a broader canvas. So if there is a deal that you want to do, go do that and then put the AI on top.”

Two of the biggest railroads announced a merger. Dying cable networks are being spun off or sold. Oil companies consolidated. The world’s biggest advertising agency, Omnicom, bought its rival, IPG, as AI rocks the industry that basically invented it. Looking ahead, I think we’ll get a big attempted airline merger next year — a final plug for our 2026 bingo card, coming to you next week before we take a few days off.

AI may be a revolutionary and exciting technology, but its immediate effect has been to put companies in a defensive crouch. This round of consolidation looks more like a clearing of the decks before AI scrambles everything.