Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.
1. If only Sam Walton were here
You can't teach an old-school retailer some new-media tricks. Wal-Mart
Normally, one would applaud Wal-Mart's move to roll with the times, but Wal-Mart has a sad, sad, history of butchering new media. It couldn't figure out DVD rentals by mail through a dedicated website. It has been a non-factor in digital music. It has even botched blogging and social media.
This deal isn't going to help. Vudu isn't much of a player in digital video as it is, and the one thing that sets it apart from larger services isn't going to fly at Wal-Mart: its ability to serve up adult content.
"Uncle Walton doesn't like porn or even colorful language, and may deep-six Vudu's adult offerings right away," writes fellow Fool Anders Bylund -- and he's absolutely right.
2. Nintendo for bookworms
There's a new handheld in Nintendo's (OTC BB: NTDOY.PK) playbook. Yes, the screen is 93% larger than the current gaming device -- an absolute necessity if it wants to be taken seriously in a crowd of Kindles, iPads, and Nooks -- but let's not get too excited about the e-book potential of the DSi XL when it hits stores next month.
The DSi XL is priced aggressively at $190, cheaper than most digital readers. However, you also have to know your market. Despite its appeal to older users with wide-demographics Brain Age and Nintendogs titles, it's hard to imagine seeing someone older than an early teenager carrying one around and playing in public.
Good luck convincing a 12-year-old that it's cooler to read a Herman Melville epic than to defeat Bowser as Super Mario.
3. Palm someday
Shares of Palm
When your CEO publicly admits that "broad consumer adoption of Palm products is taking longer than we anticipated," it's time to worry. Palm, like every other smartphone maker, doesn't have time on its side. Apple
I took some heat when I made Palm the subject of my "Throw This Stock Away" column last May, when it was trading in the pre-teens. I seemed to be wrong, initially, when the stock traded as high as $18.09 in September. However, now that it's trading for a little more than a third of its recent high, aren't bulls and bears alike wondering why Palm didn't put itself up for sale before everyone else caught on that there isn't really a market for three major smartphone makers?
4. Call in the Navy
Apparel retailer Gap
Digging into its three concepts, only Old Navy managed to post positive same-store sales, but its 7% advance was a breeze after it brought up the rear a year ago with a 17% decline.
Gap also thrilled investors by committing to return even more money to shareholders through a dividend increase and the addition of $1 billion to its share-buyback efforts. These are noble gestures, but where was that $1 billion commitment a year ago when it could have bought twice as many shares at half the price?
5. Home page, tweet home page
Yahoo!
If Yahoo! wants to stand out in a crowd, it's going to have to be a leader instead of a late follower. Besides, if Yahoo! is outsourcing its search to Bing, was this really all that necessary?
Sure, there's more to the deal than this -- but it's not what Yahoo! needs to regain its dying relevance.
Which of these five moves do you think is the dumbest? Share your thoughts in the comments box below.
