The mind of today's investor
As investors, we expect a lot. We don't want to buy into just any small-cap stock, but the best small-cap stock. We can also be impatient when we see that Kirk Kerkorian bails on General Motors (NYSE:GM) or the executive decks get shuffled at both LeapFrog Enterprises (NYSE:LF) andYahoo! (NASDAQ:YHOO).

A corporate whirlwind isn't necessarily a bad thing. Some companies need a kick in the pants. It also gives me something to write about. I can't fault that. However, sometimes, it's a different kind of news item that makes me see red.

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Blockbuster sees red
In a move that is either brilliant or nonsensical -- and there really is no choice in between -- Blockbuster (NYSE:BBI) is exchanging red Netflix (NASDAQ:NFLX) mailer flaps for free video rentals at its bricks-and-mortar stores.

The promotion runs through Dec. 21, and it's easy to see how the two extremes can play themselves out. On the successful side, Netflix patrons who haven't had to step into a Blockbuster for years may find themselves rekindling an old flame. The stores have changed over the years, and maybe visitors will find that the round-trip trek to Blockbuster wasn't as hectic or inconvenient as they had once feared. On the side for potential failure, freeloading Netflix subscribers will drain Blockbuster stores of their limited title inventories and give Netflix a break along the way, by mailing fewer discs in December yet taking in just as much in subscription money.

Sure, some companies will accept competitor coupons, but this is taking self-flagellation to a new level. Still, I don't want to rip too hard into Blockbuster unless I get confirmation of my worst-case scenario. What is this scenario? OK, I'm picturing Skip. He's a lifelong Blockbuster customer. He bleeds blue and yellow. He's a fan of film noir and doesn't mind overpaying for the microwave popcorn by the checkout line. He's feeling pretty smug. He's ready to rent Clerks 2 for a chuckle. Then, it happens. The patron in front of him whips out a Netflix mailer and gets to walk away with a free movie. Skip feels cheated. The popcorn doesn't taste so good. Kevin Smith isn't as funny as he used to be. He joins Netflix.

But I can't praise Netflix in all of this, either, unless I get confirmation of my best-case scenario for Blockbuster. Skip isn't in this scene. Let's go with Matt. He bit on the bait. Blockbuster wiped the cobwebs off his dormant Blockbuster account. Matt gets his free flick, but now Blockbuster has an army of Matts to market to. It now has a list of Netflix subscribers who haven't sworn off Blockbuster if the right carrot is presented. It charges into that army hard and walks away with more than a few converts.

It's only a promotion. I know. But it's also one that will bear watching. When the possible outcome is one of two extremes, there is both risk and opportunity.

Until next week, I remain,

Rick Munarriz

Netflix and Yahoo! are Stock Advisor selections.

Longtime Fool contributor Rick Munarriz recommends windshield wiper fluid when trying to look back. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He does own shares in Netflix. The Fool has a disclosure policy.