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. Even China has a dot-com bubble
Chinese Internet stocks took a one-two punch in the gut this week, with Sohu.com (NASDAQ:SOHU) and Baidu (NASDAQ:BIDU) delivering grim outlooks for the current quarter.

Baidu is expecting a rare sequential dip in revenue, as it migrates advertisers to a new ad platform. Sohu is forecasting a sequential slide on the bottom line, given the meandering state of brand advertising (yes, even in China).

The pounding is painful, since both companies did their part by posting better-than-expected third-quarter results. However, the market is always more concerned about what it sees through the windshield than what if finds in the rearview mirror.

2. K-SEA and the sunshine banned
Shares of K-SEA Transportation Partners (NYSE:KSP) got drilled on Wednesday, after the petroleum transporter hit investors with a deluge of bad news.

  • Fiscal first-quarter revenue and adjusted earnings fell well short of Wall Street expectations.
  • K-SEA admitted that it may be in breach of its financial covenants after the current quarter.
  • The company is slashing its dividend.

I can see why fuel-related companies were smarting earlier this year, when energy prices were tanking, but it's hard to justify disappointing news now that crude oil prices have bounced back.

3. If you build it, they will dot-com
Yahoo! (NASDAQ:YHOO) should probably stop buying its full-body-length mirrors from abandoned carnival funhouses. The sluggish dot-com is still bent on building a new campus that would span 13 buildings and 3 million square feet.

I'm all for cash-rich companies that want to move into cozier digs, but this is a bit much. The new headquarters would be able to house twice as many employees as the current Silicon Valley hub. Isn't it more than likely that Yahoo! will be smaller, not larger, in a few years? Outsourcing its paid search and axing its traffic-generating sites (farewell, GeoCities) aren't the actions of a company going through growing pains.

4. The E*TRADE Baby needs a new diaper
Even a healthy market rally hasn't been enough to bail out E*TRADE (NASDAQ:ETFC), as the discount broker posted its ninth consecutive quarterly loss. Accentuating the red ink, rival TD AMERITRADE (NASDAQ:AMTD) posted a healthy profit a few hours earlier.

I have sung E*TRADE's praises in the past. I have applauded the clever baby-backed marketing campaign, debt restructuring, and brokerage account growth. However, the end result of the company's recapitalization efforts is that it now has more than twice as many shares outstanding than it did a year ago. In other words, the stock may have shed nearly half of its value over the past year, but its market cap has risen.

Watching TD AMERITRADE post rosy bottom-line growth prospects for its brand new fiscal year has me wondering when E*TRADE will turn the corner and become the profitable company it can -- and should -- be at this point.

5. Music to Google's ears?
There's a lot of hype behind Google's (NASDAQ:GOOG) move to beef up its music-search abilities. Let's turn down the volume.

Google's new OneBox landing page allows music seekers to enter musical artist or song names. It then spits back links to audio previews with purchase options. Maybe I'm jaded, but I don't think this is what folks will search for when they're Googling for music.

Who wants what's often just a 90-second snippet of a song? If people wanted to buy the track in the first place, wouldn't they just fire up iTunes or head to their digital-music site of choice? I'm guessing most searchers are looking for pirated copies to download. Obviously, Google isn't going to play that game, but it's overestimating the demand for legal music purchases through its site. We don't need another middleman. Google should have checked in with MP3.com, a site that lost most of its relevance when it went from a streaming and downloading site of unsigned artists to a portal of digital-music providers.

My other knock on Google's new music engine is that it's incomplete. Its own blog announcement points to an Insights for Search study that shows "lyrics" as this country's top search query over the past five years. Yet the OneBox page doesn't highlight lyric-searching tools. Shouldn't those tools be front and center?

Let everyone else strike up the praise concerto for Google's OneBox. I'm singing a different tune.

Let's beat the Dumb Drum:

Baidu, Google, and Sohu.com are Motley Fool Rule Breakers recommendations. Try any of our Foolish newsletter services free for 30 days.

Longtime Fool contributor Rick Munarriz is a fan of dumb and smart business moves alike. 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.