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. Run from the Borders
The e-reader price war is getting nuts.
What are you doing, Borders? I didn't even have to dig into your abysmal quarterly report to single you out this week! Can't you see that you're only bringing on your obsolescence by hurrying the digital books revolution on?
I've been to restaurants that sell the chef's cookbooks. I've seen record shops reluctantly sell MP3 players. However, this is more on the scale of an auto showroom selling human teleportation devices.
2. Mr. Softy doesn't play hardball
It should have been a golden opportunity for Microsoft
Microsoft blew it. This could have been a golden opportunity to grab some fading yet still heavily trafficked real estate. It should have probably tried to acquire AOL in its entirety, allowing it to pick the brain of CEO Tim Armstrong, who was a celebrated Google executive before taking on the daunting challenge to make AOL relevant again.
Did you not get the invitation to the search party, Mr. Softy?
3. Stern announcement
Is Sirius XM Radio's
Howard Stern turned heads yesterday, when -- according to Orbitcast -- he told show listeners that he was "pretty sure" about leaving Sirius when his five-year deal runs out in December.
Adding more salt to Sirius XM's wounds, Stern isn't apparently bent on retiring. He hinted at launching a mobile streaming application as a premium subscription product. This could be a dagger, if his sizable audience cancels satellite radio to follow him on their smartphones and PCs.
Sirius XM stands to save a good chunk of change if Stern leaves, but it won't be much of a treat if net subscriber counts begin to go the wrong way.
4. Stalled engines
The joyride is over for automakers. Ford
The market saw this coming. Ford had warned of tough comparisons during the second half of the year, especially now that it's pitted against last year's Cash for Clunkers rebate promotion.
So, no, I'm not picking on Ford in this slot. This knock actually goes to General Motors.
Hey, GM! Nice job on the timing of the IPO. The deal is expected to price in November, now that investors may very well be turned off from weak industry sales. If you thought Ford's performance was rough, GM's auto sales tanked 24.5%.
We have to be fair and point out that GM went on to discontinue many of its product lines over the past year. It still doesn't excuse GM from the lousy timing of its return to the equity market.
5. Wince Charming
There's less to love at Charming Shops
The company behind Lane Bryant, Fashion Bug, and Catherines dressed its bottom line in red, despite delivering positive comps for the period.
Missing Wall Street's profit target is never smart, but posting a loss when the pros are looking for earnings growth is just dumb.
Which of these five moves do you think is the dumbest? Share your thoughts in the comment box below.