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. I think Icahn
Carl Icahn's partial victory is a loss for Biogen Idec
There are a few problems here.
- There are a whopping 13 seats on the board, so Icahn's cronies are unlikely to have much of a say in the company.
- Things got nasty on Wednesday, with Biogen Idec trying to keep its shareholder vote going for as long as possible, and Icahn publicly accusing the company of "hijacking" the election.
- The lack of harmony is going to make the boardroom testy, now that Icahn has a presence inside.
2. Nothing but net, book
You can tell that Redmond, Wash., is three time zones away from Madison Avenue. The buzzword is a buzz kill. It's also a mouthful and a travesty to the overuse of syllables.
There is nothing wrong with the term netbook, even if consumers are using them for far more than just surfing the Web. Besides, even though Windows XP is the operating system of choice these days on netbooks, it remains to be seen what will happen to the niche once the Android-powered portable computers hit the market. In short, Microsoft doesn't really have the right to name what it didn't create and can't control.
3. How now Dow cow?
With the bankruptcy of General Motors, the Dow Jones Industrial Average went into makeover mode. It replaced two of its fading components, adding Cisco
I get Cisco. The networking giant is a bellwether. For a brief spell several years ago, Cisco actually commanded the market's highest market cap. Travelers, on the other hand, was a huge stretch. It's a real dark horse.
There is nothing wrong with a little insurance coverage in the gauge, but I can think of at least five companies that are far larger and more relevant than Travelers.
4. Wal-Mart scales Montana
I would normally applaud any effort by Wal-Mart to embrace the "cheap chic" market, but Cyrus? This deal would have been huge a year or two ago when she was clearly ascending, but Disney's
5. More blue than jet
Shares of JetBlue
Dilution is never fun, especially with the stock closing at $5.03 on Tuesday night. It's also hard to get the market to rally around a secondary offering at a price that is less than a fourth of what the stock was trading at six years ago.
Next time you're planning a stock offering, JetBlue, check the altitude.
Let's beat the dumb drum:
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, save for Disney. 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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