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Why Yahoo is Nothing to Cheer About


Company's deal is far from impressive.


Editor's Note: The following was posted in real time on our premium Buzz & Banter. It's being shared here for the benefit of the Minyanville community.

Hello from New York where, due to technical snafus, I just spent 27 minutes guest-hosting a radio show that was supposed to run an hour. As I'd actually prepped for it, I went ahead and kept the content in and went back to my old pal, "speak like a ADHD guy who's had way too much caffeine." It's the part I was born to play!

Here's what I'm thinking, watching, buying, and selling as August gets started:

  • I accidentally peeked at Bank of America (BAC) when it opened over $15 per share with a quarter to spare. Sold 20% of it and Mr. Valentine has set the stop just north of $15.

  • Getting back to self-loathing (I like to alternate wins with losses), the move in Ford (F) is another example of the insanity of trading a randomized market. "Cash for Clunkers"? We just bought 1 billion bucks worth of cars that, for the most part, literally have a value of zero. And we're going to get long $2 billion more to celebrate the success of the number of cars sold going higher. Not since we bought General Motors (GMGMQ) have I been so impressed with the government's acumen.

  • Speaking of which, Tim Geithner was on the tube this weekend letting folks know that the middle class would be taxed along with the "Greed mongers of Wall Street." What did the "Know Nothing Party" stand for? I just may vote that way in 2012.

  • Back to buying and selling, I got long Yahoo (YHOO) for a trade this morning when it flat-lined. Yup -- I was entirely unimpressed by the deal. No -- I'm not recommending the name for anyone. I'm simply noting that 15% is plenty of punishment for a stock signing a deal that gives it a life line, if little else. Know in advance that I've got my hand on the trigger on this one, both ways. When I say I sold, I'll be after the fact; so don't count on me to get you out of this thing.

  • One last trade, I bought more of the Oil ETF (USO). Suffice it to say the existing position was so small you could carry it in a bucket, if you cashed it into Texas Tea. We're running a deficit. We're increasing our spending rate. Without adding any economic improvement, oil would have decent support.

  • Ford sales just released, up 2.3%. Your tax dollars at work, people!

  • I have to know someone for roughly a decade before I remember his or her name reliably. I still spell like a 12-year-old. I forget birthdays, anniversaries, and most everything it's rude to forget. Yet, yesterday, as I have every August 2 for nearly 3 decades, I remembered the anniversary of Thomas Hearns nearly decapitating Pipino Cuevas. Cuevas wasn't a great fighter but he could take a sledge hammer to the head fairly reliably. He simply didn't have the foggiest idea how to attack Hearns. After the fight, Pipino had nothing but foggy ideas for a long time. I didn't watch the fight until now. Didn't need to -- I can play the video of it in my head. Enjoy!
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No positions in stocks mentioned.

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