What's driving exchanges' urge to merge?
When I started in journalism in the early 1980s, few institutions were regarded as being as important as national stock exchanges.
They were protected monopolies regarded as vital to the functioning of national economies. The chairman of what was then in an imperial way simply called the Stock Exchange (because London's market did not need to bother with any kind of explicit identifier of its nationality) was perceived to be almost as important as the governor of the Bank of England or the chancellor.
In 1982, before I became a hack, I had a short stint as what was then called a Blue Button (a trainee) on the floor of the Exchange, before it all dematerialised into cyberspace. Even then, there were still plenty of top hats, bowlers, eccentric etiquette and a rigid hierarchy on stark display.
The Exchange - which later acquired humility and became the London Stock Exchange - was pretty incompetent and inefficient in a way that is typical of businesses insulated from competition. Owned by its broking and jobbing customers (they were its members), it was also perniciously riddled with conflicts of interest.
Today the London Stock Exchange is just another business listed on its own market and owned by ordinary shareholders (well some of them, like the Dubai Borse and the Qatar Investment Authority, aren't so ordinary in the LSE's case - but you take my point).
What it does - providing a liquid market for investors, and the souk in which companies can raise vital capital by selling new shares to those investors - remains essential to Britain's prosperity. It matters that investment institutions can trade in and out of shares efficiently and cheaply. It matters that global companies think the UK is a decent place to be based, because it is the home of a wide and deep capital market.
But the LSE is not the only operation providing these essential financial services in the UK any longer, because of globalisation, deregulation and technological change.
National barriers insulating the older exchanges have been eroded. And there is also intense competition confronting these older exchanges from new electronic markets, with bizarre names like Chi-X Europe and Bats Europe.
So to survive, the LSE has been frantically trying to improve its own efficiency and drive down its costs. A new trading and information system, Millennium Exchange, goes live for the UK cash market (as opposed to futures and derivatives markets) in just a few weeks.
There is something else that businesses typically do, when confronted with intense competitive pressures in markets that are being progressively enlarged and liberalised: they merge.
In the last 24 hours we have had the extraordinary spectacle of the London Stock Exchange announcing a merger with TMX Group, operator of Canada's largest stock market, and of Deutsche Boerse disclosing it is in advanced merger talks with NYSE Euronext (a business that already combines New York' bourse with assorted European markets).
When I spoke to Chris Gibson-Smith, of the London Stock Exchange, early yesterday, he was hailing the creation of a transatlantic business that would boast more listed companies than any other by a wide margin. And it would have a particular dominance in providing a market for the shares of mining companies.
Within hours that particular advantage no longer looked quite so unimpeachable - as NYSE Euronext and Deutsche Boerse showed their hand. In terms of market value, LSE/TMX may end up looking like something of a tiddler, worth less than a third of NYSE Euronext Deutsche's combined £15bn odd.
Now if you're a customer of these exchanges - either a company listing shares and raising capital or an investor who wants to trade - you might be concerned that this consolidation, these mergers, may not be in your interest. You may fear that new global monopolies are being created, that will have the ability to charge you more than a fair price.
In the shorter term, there may be something to that anxiety, especially as these are network utilities where scale delivers massive advantages.
But barriers to entry do seem so extraordinarily low, and the exchanges' customers - such as the giant investment banks and the trading addicts at hedge funds - do seem extraordinarily price sensitive (one reason why bankers' bonuses and hedge fund managers' rewards remain so high?).
Which means that any attempt by the new merged beasts to extract too much profit would probably be met with the fairly rapid creation of new trading networks.