There was a time when it seemed like putting money in Intel(Nasdaq: INTC) was like putting money in the bank -- well, one with a phenomenal interest rate. But that was when the company's business prospects and stock price rose for the better part of a decade without fail. Now Bill Mann thinks the future isn't so bright at the computer chip giant, and we're selling it from our Rule Maker Portfolio. Have a look at the report, then let us know what you think on our Rule Maker discussion board.

The Motley Fool 50 picked up 1.5% today in an upbeat market.

In today's Motley Fool Take:

AOL's Got Deal

After months of speculation, Rule Breaker Portfolio holding AOL Time Warner(NYSE: AOL) has struck a deal with AT&T(NYSE: T) and Comcast(Nasdaq: CMCSA) that will divvy up Time Warner Entertainment, owner of Warner Bros., HBO, Comedy Central, Court TV, and extensive cable television assets.

As part of the pact, AOL Time Warner will transfer all of its cable television operations, including its share of Time Warner Entertainment's (TWE) cable operations, to a new subsidiary, Time Warner Cable. AT&T(NYSE: T) will trade its $5.7 billion preferred interest and 27.64% equity share of TWE for $2.1 billion in cash, $1.5 billion in AOL Time Warner stock, and a 21% share of the new Time Warner Cable.

AOL Time Warner plans for a Time Warner Cable IPO as soon after the deal closing as market conditions permit, expected in the first half of 2003. The first $2.1 billion raised from that IPO would pay down Time Warner Cable debt that will have funded the $2.1 billion cash to AT&T. It's unclear how much AOL debt will be transferred to Time Warner Cable, though it should be transparent to shareholders. AOL must consolidate financials from its majority-owned new company.

Key for AOL shareholders is this: Within two years after AT&T Broadband and Comcast complete their proposed merger, they will offer AOL Time Warner high-speed broadband Internet service to over 10 million homes, and another 9 million after that, "subject to the parties' mutual satisfaction with the arrangements." Sources have said AOL will pay AT&T Comcast $35 to $40 a subscriber for access and a share of any advertising revenue, reputedly higher than what Earthlink(Nasdaq: ELNK) pays AOL's cable operation. The unknown is whether the market will bear what AOL must charge to make a profit.

Another wrinkle? Microsoft(Nasdaq: MSFT), which made billion-dollar investments in Comcast in 1997 and AT&T in 1999, reportedly secured a condition in the AT&T-Comcast merger agreement to offer MSN Internet service on terms at least as favorable as granted to others. Somehow, wherever AOL Time Warner goes, it just keeps bumping up against the folks from Redmond.

Jubilant investors drove AOL Time Warner shares up 7.26%, AT&T's 8.86%, and Comcast's a whopping 15.26%. Are they right? Take our poll on the AOL discussion board.

Wrestling's Smackdown

It's not easy being World Wrestling Entertainment(NYSE: WWE) these days. With popularity waning, the company's fiscal first-quarter results got smacked around, tossed against the turnbuckle, berated with a, "Who's your daddy," and left down for the count.

Earnings fell by nearly 80% to $0.04 a share for the July period, with the bulk of that coming from a $2.2 million settlement with the Parents Television Council. The group publicly faulted the wrestling specialist for the violent deaths of children. We could argue about whether the art of fake grappling really hurts our children, but why get into it when we all agree the damage being done is real to the adult shareholders.

Founder Vince McMahon can't script his way out of this malaise. Sure, revenue dipped just slightly to $88.1 million. However, there's more to it than meets the eye. The quality of that revenue is slipping, as margins get the rug pulled from beneath.

Sure, attendance at live events ticked up from 415,000 to 500,400. However, it came after the company staged more than twice as many events as the year before. The average attendance at a wrestling event has slipped from 9,651 to 5,751.

Like a band on the decline, forced to hit smaller venues, World Wrestling Entertainment just isn't as important as it used to be. Pay-per-view buys fell from 1.6 million to 1.1 million for the quarter. We're not sure what The Rock is cooking, but, right now, it stinks.

Discussion Board of the Day

Are the golden days of wrestling over? Does The Rock really think he's a movie star? Is grappling really a bad influence for the little ones? All this and more -- in the Wrestling Talk discussion board. Only on Fool.com.

Grade Your 403(b)

No one deserves to be exploited, least of all the overworked and underpaid. Of course, we're talking about teachers and others who work for non-profit organizations. For many of these folks, their employer-sponsored retirement plan is known as the 403(b).

A 403(b), named after a section in the tax code, is often called a tax-sheltered annuity (TSA), because until 1974, annuities were the only options available. Though 403(b) participants can now choose mutual funds, the majority of 403(b) assets are still with annuities. This is not good. Annuities are expensive, mediocre investment products often pushed too heavily by brokers and insurance agents looking for hefty commissions. As discussed in a recent BusinessWeek article, the fees in a 403(b) plan can be twice as high as those associated with a 401(k).

Luckily, things have gotten much better for 403(b) participants, in the way of new laws and more education. As for the latter, one of the best places to go for the latest developments is 403bwise, a site operated by two teachers, John Moore and Dan Otter. As the new school year begins, now's a great time for teachers to grade their retirement plans. Otter (an occasional Fool contributor) suggests keeping the following points in mind:

  1. A 403(b) is a great way to save for retirement: Contributions reduce taxable income, and the money grows tax-deferred.

  2. You have choices: You can do it yourself through a company like TIAA-CREF or Vanguard (among others), or go through an agent.

  3. Fees matter: Some agents provide often valuable service, but at a cost. Also, make sure you understand all the fees and surrender charges before investing any money.

  4. The 403(b) is a long-term investment vehicle: Have a plan, and stick to it through thick and thin. Long term is not one year.

For a rundown of the latest changes in the 403(b), check out 403(b) Changes for 2002. And for a concise but thorough explanation of 403(b)s, check out The 403(b) Wise Guide.

Quote of Note

"One moment of patience may ward off a great disaster; one moment of impatience may ruin a whole life." -- Winston Churchill, 1874-1965

Gadflies and Tyco

In Slate.com recently, Nell Minow, a respected corporate gadfly, lamented the shortage of gadflies these days. She praised the late Gilbert brothers, who, over the past many decades, brought about invaluable reforms we take for granted today.

For example, she writes:

They persuaded the then-brand-new SEC to allow shareholders to circulate their criticism of management at company expense by submitting shareholder proposals that would be included on the company's proxy. The Gilberts fought for shareholder approval of auditors, confidential voting to protect shareholders from coercion, cumulative voting to give minority shareholders the ability to elect one director to the board, and annual meetings held in cities that were conveniently located. The Gilberts were among the first to object to outrageous CEO pay packages.

Minow also notes, "They made a lot of money, too. Their investment policy was simple: Never sell." She explains that few small investors become gadflies, since making waves would consume a lot of energy for those with relatively tiny stakes in a company. Instead, institutional investors should take action. "They do have the time, the resources, the analytic power, and the sheer amount of money at risk to monitor accounting tricks and executive compensation abuses," Minow writes.

They usually don't take action, though, often due to conflicts of interest. But today there's news of an exception. The Wall Street Journal (subscription required, free trial available to Fools) reports that some big Tyco(NYSE: TYC) shareholders are calling for the ouster of board directors who served under ex-CEO Dennis Kozlowski. Participating in this action are folks such as Bill Miller, Legg Mason(NYSE: LM) mutual fund manager extraordinaire. Legg Mason owns more than 60 million Tyco shares, and Miller writes, "Every one of those old board members should tender their resignations immediately.... I am perfectly prepared... to withhold those [Legg Mason] votes for directors or vote for a different slate, if that's what it takes."

To learn more about the gadfly biz, since you have the power to become one yourself, check out Nell Minow's website, The Corporate Library. Also, read about the admirable-but-weird gadfly Evelyn Y. Davis, and check out the 1956 movie Solid Gold Cadillac, starring the wonderful Judy Holliday. It should be especially enjoyable for Fools.

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Quick Takes

Michael Kopper, a former aide of Enron CFO Andrew Fastow, is pleading guilty to money laundering and conspiracy to commit wire fraud. He's also forking over $12 million in ill-gotten gains and cooperating with authorities. This is a big development, since reeling in smaller fish can help investigators land bigger fish.

Nestlé has reported solid numbers for its first half of the year. According to a Reuters story, "First-half sales rose 7.2% to 44.22 billion francs, boosted by Nestlé's $10 billion acquisition of U.S. pet food producer Ralston Purina." The coffee, pet food, and candy giant didn't comment on rumors that it might make a bid for rival Hershey(NYSE: HSY).

In earning news, Radio Shack(NYSE: RSH) has warned that sluggish sales in August will deflate its third-quarter earnings. This echoes an earlier warning of weakness in consumer electronics from Best Buy(NYSE: BBY).

Dell Computer (Nasdaq: DELL) , in its continuing (and largely successful) effort to grab an even bigger piece of the computer pie, is moving beyond selling computers directly to consumers. It has announced it will sell generic PCs to dealers, who will then sell them to small businesses.

As the major airlines struggle to survive, changes are afoot. A New York Timesarticle (free registration required), reports some changes are expected for low-fare Continental Airlines(NYSE: CAL) flyers: "...the airline will charge $20 extra for each paper ticket, a change that American and United Airlines have already made. Passengers will not receive a full can of soda unless they ask. They will also have to ask for plastic knives at breakfast if they want one. Those last two changes will save the airline $1 million and $80,000 a year..."

Internet caching company CacheFlow trades today under a new name and ticker -- Blue Coat Systems(Nasdaq: BCSI). Perhaps the company was embarrassed about the unfortunate homonym its previous name represented. CacheFlow never produced positive cash flow from operations, let alone any free cash flow. We say: You can run, but you can't hide in your Blue Coat.

And Finally...

Today on Fool.com: Whitney Tilson says we're only human.... Rule Maker makes an Intel-ligent decision.... Think those fees are pricey? It's mutual, in Fool's School.

Contributors:
Bob Bobala, Robert Brokamp, Jeff Hwang, Tom Jacobs, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Jackie Ross, Reggie Santiago, Dayana Yochim