But Morgan is not a Mickey Mouse bank. This is an irresistible trophy franchise for, say, Chase Manhattan Bank. I think so. If my macro view of lower interest rates is correct, downside risk is no more than 10 while the upside potential is 90 points. Every macro investment theme I watch has flashed a buy strong signal on insurance stocks.
Economies of scale are huge in global insurance, definitely in the life sector.
Besides, Congress has made it easier for banks to acquire insurers and vice versa, as the Sandy Weill - John Reed marriage last April proved. Its new CEO John Boscia has not ruled out a merger as a way to unlock shareholder value. If the price is right, Boscia will sell and there will be no shortage of bidders for Lincoln among the world's life insurance elite. It is only a matter of time. Meanwhile, the CEO is restructuring the business and Lincoln uses the Internet to target its marketing, communicate with its clients and boost profit per online accounts.