Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's look at five dumb financial events this week that may make your head spin.

1. Abercrombie & flinch
What do Icarus and Abercrombie & Fitch (NYSE: ANF) CEO Mike Jeffries have in common? They're now both infamous for flying-related failures.

Abercrombie's wings of wax are the result of a helmsman who got too greedy with a clause in his contract that allows unlimited personal use of the corporate jet. In a headshaking development, Abercrombie's board will pay Jeffries $4 million in exchange for capping his corporate jet usage to $200,000 annually.

Wow. Isn't this guy supposed to be working? How much personal time do you have to log in the air to make a boardroom fork over $4 million? Plenty, including $1.1 million in 2008 alone. The company worked the math and shelled out accordingly, adding a provision that he will have to pay a pro-rated amount of that lump-sum payment if he leaves within the next four years. It's a retention bonus, then, in a roundabout way. Question to shareholders: Would you want to keep someone around who's that frivolous with your money?

Well, at least now we know why all those Abercrombie models appear half-naked in the retailer's marketing material: The clothing budget was going to keep Jeffries up in the air.

2. Schmidt happens
Google (Nasdaq: GOOG) CEO Eric Schmidt was speaking to dinosaurs in denial at the American Society of News Editors conference this week.

In an effort to butter up print-media editors -- and shake them off his news-aggregating trail -- he decided to praise editors by dumping on bloggers.

"There is an art to what you do," he said to the editors, as retold by Nieman Journalism Lab. "And if you're ever confused as to the value of newspaper editors, look at the blog world. That's all you need to see. So we understand how fundamental tradition and the things you care about are."

Schmidt's right. Unchecked bloggers butcher grammar and occasionally give journalism a bad name. However, Google also happens to own Blogger.com, the widely popular blogging site. There are also countless bloggers who syndicate Google's contextual marketing spots through the search giant's AdSense program. Surely there must have been some way for Schmidt to win over the editors without bashing a group that Google relies on and will be no doubt quick to spread the story around.

3. Blizzard gets snowed over
Activision Blizzard (Nasdaq: ATVI) raised its outlook for the current quarter and for all of 2010 yesterday. Mr. Market's response was to deal the leading video-game software house a 2% dip.

What happened? Well, you can't judge a press release by its run for cover. Activision Blizzard bumped up its bottom-line target from $0.70 to $0.72 a share, but that's where analysts were already perched.

The company also propped up its forecast for the quarter ended in March, but that news was dampened when it warned that certain operating expenses planned for the period are being bumped to the current quarter. In other words, the upbeat first-quarter outlook can also be seen as the hosing down of its second quarter.

4. Trade of honor
Shares of E*TRADE (Nasdaq: ETFC) spiked yesterday, after a rival discounter all but said that it will be on the hunt for some buyout activity.

"There are lots of potential acquisitions, and we've got a lot of firepower," TD AMERITRADE (Nasdaq: AMTD) CEO Fred Tomczyk said in a Reuters interview. "We do look at that."

E*TRADE has been connected to buyout rumors in the past, and a hookup with TD AMERITRADE makes perfect sense. However, this makes it into the "dumb move" camp regardless of which way this turns out. If Tomczyk is serious about a consolidation shopping spree that includes E*TRADE, telegraphing the move is only going to drive buyout prices higher. If Tomczyk is simply bluffing, E*TRADE buyers get the dunce cap for running up the stock on the chatter.

5. Video killed the MTV star
The legal battle between Viacom (NYSE: VIA-B) and Google's YouTube continues to heat up.

Viacom released several additional documents yesterday, including some presumably saucy quotes from Google senior employees when the search giant was weighing its buyout of the video-sharing site.

  • "YouTube's business model is completely sustained by pirated content."
  • "YouTube's content is all free, and much of it is highly sought after pirated clips."
  • "[W]e should beat YouTube by improving features and user experience, not being a 'rogue enabler' of content theft."

This is incriminatory how? If anything, it applauds Google's subsequent moves in cleaning up the site after the acquisition, through the creation of the YouTube Partners program and revenue-sharing deals with media giants. One of the first participants was none other than Viacom sibling CBS (NYSE: CBS).

I'm not saying Viacom doesn't have a case, but it's going to have to come up with more than what Google was saying about YouTube before buying in.

Which of these five moves do you think is the dumbest? Share your thoughts in the comments box below.

Google is a Motley Fool Rule Breakers recommendation. Motley Fool Options has recommended a synthetic long position on Activision Blizzard, which is a Motley Fool Stock Advisor choice. The Fool owns shares of Activision Blizzard. 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 alike, since investors can learn plenty from both. He owns no shares in any of the stocks in this story and 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.