Yahoo, Microsoft Redefine "Anti-Trust"

Greetings from New York where I lack any Trust that there’s anything in the “Bing” deal between Yahoo (YHOO) and Microsoft (MSFT), which has never shaken off becoming a Dow component a decade ago.

In MSFT’s defense, they’re doing better than Citigroup (C) has done since being cast out of the DJIA at the beginning of ‘09. C is down 57% in just 8 months compared to Microsoft’s roughly equivalent drop over the last decade. If you’re drawing conclusions, MSFT is what it looks like when “things stop getting worse as fast as before."

Conclusions: Avoid anything added to or removed from the DJIA (except Cisco (CSCO)). The Dow is “the market” to your mom, but in no way meaningful otherwise. It consists of 30 stocks now picked by a bunch of Australians and crazy Murdoch’s. As far as we know, they write 52 large caps on playing cards and make interns pick names out of a kangaroo’s mucus-lined pouch. First two to grab names just picked the new Dow stocks AND gets to spend a night partying with the dilettante Murdoch kids.

Yahoo was offered over $47 billion by Microsoft last year. Today Mr. Softie paid, in effect, nothing for the guts of Yahoo. Just as Tiger dropped out of Stanford and missed the classes on how to make the cut at Turnburry and was forced to fly home in his private jet and watch Stanford graduate (Class of Ought ‘6... 19 ought 6), Yang learned that quitters never win in the end.

Carol Bartz, who replaced co-Chief-Yahoo Yang for the second time, used her folksy U of Wisconsin education to realize that “taking what you can get” beats "snubbing a large premium from a company willing to pay cash when you have no other turn around plan, save ‘hope’."

As it turned out, Microsoft didn’t even have to use cash to buy Bing. They simply get a cut of whatever Microsoft can make online. Not even Excel can tell me what 12% of “enormous humiliations” Microsoft has garnered from Internet efforts thus far would net Yahoo but, as a betting man, I’ll take the “Under” on whether or not Bing earns Yahoo $47 billion. Indeed, I have so much anti-trust in this deal taking a huge share of the ‘net from the evil Russians at Google (GOOG) that Yahoo should hire me to testify on their behalf.

Here are some other things I don’t trust and a few things I do, just to mix it up a bit:

• Bank of America (BAC) is clawing it’s way out of my dog-house; now firmly green since my early July purchase. The gain comes despite BAC dropping 6% in earnings and getting downgraded on the credit side by Fitch, one of the few rating’s agencies who still deserves any respect whatsoever. I do love being long low expectations.
  
  
• Speaking of which, I’m happy to be out of all the casinos except Las Vegas Sands (LVS) despite the company eating into my profits from the casino basket with today’s decline. Both Wynn Resorts (WYNN) and LVS report tomorrow and both are expected to lose one penny. Wynn’s consensus for next quarter is to lose 4-cents, LVS is stuck at minus a penny but expected to grow revenues. The keys for both are getting Macau on the Hong Kong exchange and staying liquid, especially for LVS. Why am I still long LVS? Because the new CEO has gutted expenses at a harrowing rate and if ever a company needed two quarters to be dolled up a bit it was LVS this Q and next.
  
  
• What do I want from LVS? Good numbers and a chance to sell an after hours pop. I’m not much of a “buy an hold” fella these days.
  
  
• Sprint (S) is getting hung up to the tune of 12% today after reporting wider than expected losses. I think Bono owes the gang from Sprint a little “I’m Sorry” type of song for the fake Pre-release last D-Day. Since the one-day sell-out Palm is up 10% and Sprint is down 20%. “We took your beach, stormed through your hedgerows. Our profits Bulged your losses did grow.” Something moody and acoustic.
  
  
• For what it’s worth, my book is lighter than my Kindle, both in names and size. The dollar blows (though not of late) but it offers a decent bunker with this rally rolling over at resistance.