The market in general and the Nasdaq in particular took it on the chin again today. The once-mighty Naz dropped another 3% and has now fallen below the 1,200 level -- a six-year low and a far cry from its high of 5,046.

With the stock bubble long since burst, attention has turned to the housing market. If there is a bubble in that sector, there's some indication it may be more severe in Australia than the U.S. According to Reuters, a financial institution in Sydney has approved a 30-year house loan -- for a 92-year-old woman.

Congratulations, Margaret Cole. Please send us an invitation to your mortgage-burning party when you finally pay off the loan at the ripe old age of 122!

In today's Motley Fool Take:

Qwest Reverses Revenue

Swapping: It's not just for energy companies and swingers anymore. Now that Qwest Communications(NYSE: Q) has admitted to it, there's a cloud over the entire telecom sector.

One of the country's leading long-distance and local phone providers, Qwest apparently sold capacity on its optical networks to other carriers, such as Global Crossing; recorded revenue for these transactions; and then purchased similar amounts of capacity back from the carriers. The artificially inflated revenue figures gave the appearance that the businesses were growing faster than they actually were. This is exactly what happened with companies like Reliant Resources(NYSE: RRI) and CMS Energy(NYSE: CMS), with their "round-trip" energy trades.

In an effort to make things right, Qwest says it will now wipe $950 million in revenue off the books from 2000 and 2001. The trouble is probably not over, however. The SEC and the Department of Justice are investigating the swapping arrangements, and the company admits it may have to restate more revenue in the near future.

Interestingly, Qwest is attempting to lay some blame at the feet of Arthur Andersen. The press release announcing the restatement twice refers to "policies approved by its previous auditor Arthur Andersen." Investors shouldn't be mollified by such scapegoating attempts, however; those involved in the swaps knew very well what a sham they were.

Unfortunately, this is but one more example of overaggressive management propping up a company's short-term prospects while business is crumbling. As a result, investors who trusted the executives to look out for their best interests have seen the value of their holdings collapse 95% from their all-time high.

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Quote of Note

"The advice of friends must be received with a judicious reserve; we must not give ourselves up to it and follow it blindly, whether right or wrong." -- Pierre Charron (1541 - 1603), French writer and moralist

Weakness at Wal-Mart

It's not enough to have earnings warnings now. Same-store sales warnings are becoming increasingly fashionable, as retailers are finding it ever harder to lure customers into spending.

Supporting our skeptical view on rosy August retail sales, the world's biggest retailer, Wal-Mart(NYSE: WMT), announced this morning that it expects its September same-store sales (comps) to come in at the "low end" of its projected 4% to 6% growth.

The company said the same thing about its August comps, and August growth ended up at only 3.8%. The retailer spooked folks looking for a turnaround in consumer spending back then, and it spooked them again today.

Wal-Mart is one of the few retailers with strong September 2001 comps growth to contend with. Comps grew 6.3% in September of last year, as customers stocked up on flashlights, batteries, gas cans, and bottled water. That behavior skews things, from a comparative view.

However, it's still a bleak retail outlook. As of last Monday, Wal-Mart said sales were still trending in the 4% to 6% range, and it looked like consumers were returning (at least marginally) to stores. Now, with the month in fuller view and weakness apparent, Wal-Mart's hoped-for September improvement is nowhere to be found, and the implication for other retailers isn't good.

Investors have been waiting for consumer spending to broadly strengthen, and for much of the last year, Wal-Mart and other discounters have been the only consistent gainers. It now appears that the American shopper is scaling back even more. It'll be ugly for all retailers should this trend continue. Back-to-school spending proved to be a joke in August, and September's not looking any better. As of now, there's no real reason to believe that the holiday shopping season will be strong enough to turn around the current slump.

But, hey, it's just one-month's comps from a single retail company, right? Well, yes, but when that company is Wal-Mart, it pays to pay attention. If shoppers aren't buying from Wal-Mart, you can bet they really aren't buying from Nordstrom(NYSE: JWN) and Federated(NYSE: FD) department stores such as Macy's. Retail investors at large should be concerned.

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Game On for Yahoo!

Frustrated investors who feel Yahoo!(Nasdaq: YHOO) should quit playing games and get back to business may have to rethink that position with today's unveiling of Games on Demand.

By giving its growing broadband user-base the ability to rent popular PC games, complete with online delivery, the Internet titan hopes to add another potent revenue stream to its roster of premium services.

Video games are big business, and Yahoo! isn't the first dot-com mover in this potentially lucrative space. Electronic Arts(Nasdaq: ERTS) has been building out its homestead for a couple of years now, while Microsoft(Nasdaq: MSFT) hopes to milk its Xbox console's earning power through the launch of Xbox Live.

It if flies, this could be a thick slice of fat margin paradise. Because the games will be delivered through high-speed modem connections, there are no costly packaging or inventory costs. Beyond the bandwidth required to deliver the games and the title-developer ransoms, there's a lot of gravy left for Yahoo! if this pans out.

It won't be easy. While Yahoo! has established a million different paying relationships with users, much of that has come from dating services and high-end email, which folks expect to pay for. There are plenty of quality games available online through sites such as and the Electronic Arts-owned Pogo. However, Yahoo! will offer complete titles, even if some of them are dated by today's PC gaming standards.

If Yahoo! achieves some degree of success, it's only a matter of time before prominent game developers provide Games on Demand with their latest titles to cash in on the advantages of online delivery. And that, folks, is when the game really starts to get interesting.

Discussion Board of the Day

Despite its huge cash balance and its ubiquitous status, some folks believe Yahoo! is overvalued even here in the single digits. Do you... Yahoo!? All this and more -- in the Yahoo! discussion board. Only on

Quick Takes

Telecommunications firm Sprint(NYSE: FON) has been struggling under a heavy debt burden. That will soon be lightened a bit, as the company sells its directory-publishing unit to R.H. Donnelley(NYSE: RHD), which sells yellow-page advertising, for $2.23 billion. Meanwhile, Sprint warned of sagging performance in its wireless services and predicted somewhat higher-than-expected results for its traditional phone business.

You know that private companies often go public through IPOs, right? Well, sometimes public companies go private. That's what might happen to Dole(NYSE: DOL). According to a Bloomberg report, "David Murdock, the billionaire chairman and chief executive of Dole Food Co., offered about $2.5 billion to take the world's largest fruit and vegetable producer private after a 28% slide in the company's shares since May. Murdock will pay $29.50 a share in cash for the 76% of Dole stock that isn't already owned by his family." The offered price is 20% above Dole's closing price on Friday and sent shares up about 18% by market close.

Many of America's major airlines are once again looking to Washington for additional emergency funding. Problems cited include sluggish passenger traffic and rising fuel costs. It's enough to make a Fool wonder why the government keeps bailing out these seemingly perpetually beleaguered airlines. It's not like there aren't examples of long-term successful (and profitable!) airlines, such as Southwest(NYSE: LUV). Meanwhile, unions at UAL Corp.'s(NYSE: UAL) United Airlines are trying to work together to help the company avoid bankruptcy.

Health food from PepsiCo(NYSE: PEP)? It might happen. According to an article in The Wall Street Journal (subscription required, free trial available to Fools), new CEO Steven Reinemund "is pushing to make at least 50% of PepsiCo's food-and-beverage offerings 'nutritious' -- cutting fat and adding ingredients such as broccoli." The changes afoot are risky, as many consumers aren't interested in more healthful offerings. Still, the company plans to introduce "better for you" and "good for you" products.

And Finally...

Today on Find the green using grassroots investing.... Can this face launch 1,000 ships? Zeke Ashton examines Helen of Troy.... In Fool's School, be smart about donating to charity.... And the Fool makes Carmela Soprano an offer she can't refuse.

Bob Bobala, Robert Brokamp, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Jackie Ross, Reggie Santiago, Dayana Yochim