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. It's why they call them diehards
Why should GameStop catch a cold if Wal-Mart sneezes? Well, GameStop isn't really in a position to begin matching price cuts. It needs to protect its used game business, which happens to draw substantially higher margins than its new wares.
GameStop is already coming off disappointing same-store sales in its latest quarter, and there was always the hope a strong holiday showing would bump the specialty retailer back in the right direction. A price war is the last thing it needs.
2. Drove the levy to the Chevy, but the Chevy was dry
General Motors must make uncomfortable cars to drive in. I heard the latest guy couldn't last on the hot seat for more than seven months.
Yes, GM canned CEO Fritz Henderson after barely half a year at the top. Many are applauding the move, because Henderson was a 25-year veteran at the company. They love to point to Ford's
However, it's not so easy to catch a Mulally in a bottle. In fact, Henderson's short leash should spook any potential CEO candidate. It's bad enough that running GM will likely be a thankless job, under the cruel heat lamp of taxpayer scorn and staunch federal oversight. So, really, do you think that even Mulally could turn GM around?
One can rightfully argue that GM's culture needed some cleansing, but isn't that what's been happening for most of the past year already?
3. Making green mountains out of molehills
I've been coming down on Green Mountain Coffee Roasters
Green Mountain's latest offer is for $35 a share in cash. The original suitor's price for the company was $26 a share in cash and stock a month ago.
There may appear to be nothing wrong with Green Mountain wanting a little more skin in its K-Cup ecosystem game, but its voracious pursuit has to be upsetting to other companies that help keep its Keurig single-cup brewers humming along with portion-pack refills. Green Mountain is creating a conflict here that will eventually become a conflict of interest.
4. Out of touch
Unfortunately, Dell has a long way to go if it ever wants to be a tastemaker again. It ignored last year's netbook craze. It jumped in too late into the smartphone market. Now it has a system that's either an overpriced laptop or an awkward tablet.
5. Too many Nooks in the kitchen
Remember when Barnes & Noble
Nooks were supposed to begin shipping out for the earlier pre-orders on Monday, hitting stores shortly thereafter. Well, it's been a bumpy rollout. The first batch was supposed to ship this week, but now the retailer has no idea when it will begin stocking them in actual stores. Demo units will only be going to high-traffic stores next week.
Remember when Amazon.com's
If you're going to launch an e-reader, beware of the talk-show jinx!
Let's beat the dumb drum:
Green Mountain Coffee Roasters is a Motley Fool Rule Breakers pick. Amazon.com and GameStop are Stock Advisor recommendations. Dell and Wal-Mart are Inside Value picks. Try any of our Foolish newsletter services free for 30 days. That certainly wouldn't be a dumb move.
Longtime Fool contributor Rick Munarriz is a fan of dumb and smart business moves. Investors can learn plenty from both. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.
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