The recipe for horse and rabbit pie requires one of each. The recipe for the new all-Europe stock exchange requires one Deutsche Bourse and one London Stock Exchange. Can you spot the rabbit? The killer phrase here is “merger of equals”. There have been a few genuine mergers, but they are a recipe for acrimony pie. In true life, there are only takeovers, and the chief executive calls the shots. This one also creates a “European champion” which counts as a double red light.

The gains from putting clearing houses together are so simple that even an outsider can see them, which is why everyone has wanted to buy the LSE over the years. As CEO, the fiesty Clara Furse was forever fighting them off, at prices which look silly now. Today’s boss, Xavier Rolet, wants to spend more time with his bees, and after seven years it is hard to blame him. Donald Brydon is a 24-carat City grandee, but with today’s governance rules the chairman is not in charge of the business.

Then there is the curious timing. Perhaps the ambitious Carsten Kengeter thinks Brexit is irrelevant, but whatever happens in June must impact the investment landscape – a known unknown which could have been avoided with a little patience. The newish Deutsche CEO is clearly a hungry man, but on these terms he should not be allowed to eat the rabbit.

At home with Legal & General

Legal & General is not your average housebuilder, but then Nigel Wilson is not your average insurance company CEO. He actually wants disruption, and no more so than in housebuilding, a cosy industry which he savages as “constrained supply in a rising market and a shortage of innovation and competition”. Where other investors might lean on the builders, L&G is going into the business itself.

Rather than join the fight for scarce brickies and carpenters, the company is to make the homes off-site in a new factory. Please do not call it system building, responsible for those ghastly flats half a century ago. If L&G’s pretty pictures are a guide, these will be nice Scandinavian-style homes, and building time on site will be cut by 70 per cent.

Mr Wilson has more than housebuilders in his disruptive sights. Talk of getting a return from financing attractive projects makes him sound like an old-fashioned banker, but a life office has a key advantage. It is financed by contracted savings rather than short term deposits. It can invest for the long term without needing to keep cash on hand. It can take a 50-year view. It can, in the jargon, capture the illiquidity premium.

This is hardly new. What is, in Mr Wilson’s eyes, is today’s “world of zeroes” – zero growth, zero interest, zero inflation, which obliges insurance companies to do more than rely on buying debt and letting compound interest meet their pension and life policy obligations. Companies are awash with cash, but “never has there been so much money available to invest, yet so little of it being put to productive use.” L&G is stepping in with “economically and socially useful” capital.

This visionary speech, to Cazenove’s investment conference last week, might be enough to get us hard-bitten investors running to sell the stock, except that Mr Wilson has already nailed his financial colours to cash, earnings and dividends as the driving metric. As he concluded: “We have seen significant dividend progression, including 19 per cent in the first half of the year…” Not exactly your average profit forecast either, then.

Something rotten in paradise

Do they know what they are doing? Shares in a little AIM-quoted outfit called Eden Research jumped after the company was cleared to use a terpene-based fungicide (don’t ask) on vines in Spain. This stuff prevents botrytis, “a widespread fungal disease that causes grey mould on many fruits”. Please keep it out of Bordeaux, home of the world’s finest sweet white wines thanks to botrytis, or noble rot. As Sydney Smith did not quite say: “My idea of Eden is drinking Chateau d’Yquem and eating foie gras to the sound of trumpets.”

This is my FT column from Saturday

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