HBOS shares surge - Grim news for Lloyds shareholders

One report of the share price surge is in the IHT, here. Clearly following Brown's backing for the merger, powerful vested interests are at play as all logic and the facts still point clearly against the deal. The Nationwide this morning reports house prices still on the slide, read here. The Halifax report due in the next couple of days was more gloomy even than the Nationwide last month. Meantime the real economy slows e.g. M&S sales down 6.1% here. The consensus house price fall is now forecast at 25 per cent from peak to trough. Anybody with less than a quarter of their own money in the house at peak levels therefore faces negative equity, a recession, a global currency crisis, a looming potential collapse of the Euro with all that implies for trade and goodness knows what else. Why would a Lloyds shareholder wish to buy into Britain's largest mortgage issuer, the Halifax, especially when it has just completed wiping out the Bank of Scotland shareholders and there are no plans or policies from anybody either within the Government or the Opposition to do anything to ease or control the house price fall - an overshoot beyond the sensible 25 to 40 per cent correction therefore now appears possible? Makes no sense to me! Especially with Brown still making policy on the hoof in Number 10!