The S&P 500 finished just about even today -- meaning it clinched its best quarter in 4 1/2 years. For the past three months, the S&P has soared 15%, the Dow Jones Industrial Average 12%, and the Nasdaq 21%.

Does this mean a new bull market has begun, or is this just a bear market rally? As our own Bill Mann (TMF Otter) just blurted out, "Who gives a horse's rear about short-term movements? What really matters is that the market is likely to be higher in the long term."

Then, he added, "More importantly, did you see they named a tropical storm after me?"

In today's Motley Fool Take:

Microsoft's a Tightwad

Poor Microsoft(Nasdaq: MSFT) can't catch a break these days.

For years, income investors have argued that the tech giant should loosen up its purse strings and start paying out cash dividends. The company finally caved in and announced a new payout policy back in January. Now the new mantra, that is if you're going by the cover story in this weekend's edition of Barron's, is Mr. Softy isn't yielding enough green for its dividend-starved investors.

Leave it to Wall Street! Give 'em eight cents and they'll hold out for two quarters.

However, the argument for boosting its anemic payout is sound. Microsoft is sitting on $46 billion in cash. But this isn't the type of cyclical company in need of a meaty war chest during its industry's downtime, unlike automakers or airlines. Neither is it investing the capital back into the company in significant chunks, as that cash balance continues to grow with every passing quarter. That only leaves a blockbuster acquisition as a reason to keep billions stashed away in its pockets, but that's highly unlikely now that the eyes of the Federal Trade Commission are glued to it.

If there's any relative consolation, it's that the stock's 0.3% yield has remained constant while money market yields have been swan diving this year. Yet it's been constant because the stock has remained stagnant. Ouch! The stock is trading marginally lower this year, and that's a sad state because so many other tech stocks have started to bounce back.

Would a 2% yield win over the conservative income investor by giving the stock some form of bottom cushion? Not really. Blue chipper Bristol-Myers Squibb(NYSE: BMY) is paying out twice that much. While a meatier payout couldn't hurt, the problem is the perception of the way the company is managing its money.

Microsoft's stock is exactly where it was five years ago while the company has been able to grow its business. If it doesn't want to pump up its dividend rate, a more logical and stock-supportive measure should be taken. Let it announce the world's largest share repurchase program. If it has all that lunch money, let it prove its self-worth by eating its own cooking.

Discussion Board of the Day: Microsoft

Do you think that Microsoft should raise its dividend? Is the company not doing enough with its idle cash? All this and more -- in the Microsoft discussion board. Only on

Reuters Reaches for Research Dollars

Remember when several Wall Street firms settled with the SEC and New York Attorney General Eliot Spitzer over biased research charges? (Of course, you do!) Well, we're now starting to get a better picture of a cornerstone of that settlement: the establishment of independent research outfits.

Credit Suisse First Boston (NYSE: CSR) , Lehman Brothers(NYSE: LEH), Deutsche Bank(NYSE: DB), Bear Stearns(NYSE: BSC), and others agreed last December to pay some $1.4 billion in fines and to contract with no less than three independent firms that will provide research to the brokerage firms' customers. The idea is to build a wall separating investment-banking business from research.

Now another company is casting its net hoping to capture some of those $400 million in independent research money: news and data specialist Reuters Group(Nasdaq: RTRSY). It joins a few others -- such as TSCM), Morningstar, McGraw-Hill's(NYSE: MHP) Standard & Poor's, and Value Line(Nasdaq: VALU) -- that are gunning for the business.

Reuters has somewhat of a different tack, however, because of its acquisition of data provider Multex. "We can produce 70% of a good Street research report -- all the fundamental data, ratio analysis, technical analysis," said CEO Tom Glocer at a recent presentation, "and we can do it on a universe of 4,500 U.S. stocks, all driven from the same common database that we need anyway to improve the fundamental data in our products."

Should there be a demand for such a product, it would provide a nice, high-margin revenue stream, because most of those reports would require few man-hours: Banks and other customers, armed with the extensive data, would provide the remaining 30% of effort needed to complete the research.

"We needed Multex in any case to fill the strategic gap on fundamental data," Glocer said, "but with it came, in my mind, certainly the wherewithal to get serious in playing in whichever way investment research restructures."

Quote of Note

"I'm an atheist, and that's it. I believe there's nothing we can know except that we should be kind to each other and do what we can for people." Katharine Hepburn, 1907-2003, four-time Academy Award-winning actress

Tiffany's Tokyo Bargain

In 1990, when the U.S. government was struggling with a debt load in the trillions of dollars, it could have wiped clean as much as a third of this debt by selling the land surrounding the U.S. Embassy in downtown Tokyo. At several million dollars per square foot, downtown Tokyo was, at the time, valued as much as the entire state of California. Some people would have taken that trade. Among the most expensive was real estate in Ginza.

Fast forward to today: It's 13 years later, and Japan's stock market remains about 80% below its 1990 highs. As far as the folks in Japan's real estate are concerned, shareholders got off light by comparison. But Ginza is still there, brash and tony as ever. Imagine, if you will, Japan's version of Rodeo Drive, the Magnificent Mile, and Fifth Avenue -- it's high-price, prestigious real estate, not immune to bubbles, but also fairly immune from total collapse.

Tiffany & Co. (NYSE: TIF) established its flagship Japanese store right in the heart of Ginza in 1996, currently possessing more than 12,000 square feet of retail and office space. We're thinking that Tiffany's decision today to purchase the entire building will make its lease negotiations substantially easier in the future. The company bought the 61,000 square foot building for 16.5 billion yen, or about $140 million. That comes to $20,000 per square foot of land (about 6,800 square feet), had the sellers thrown the building in for free.

While we can't be certain that the Japanese stock or real estate markets will be improving anytime soon, this strikes us as an immensely sensible purchase. Tiffany got bridge financing from a Japanese bank to do the deal, and is currently working on securing long-term financing. Anything you can say about the environment for borrowers in the U.S. can be multiplied in Japan -- it is a buyers' market, with borrowing rates lower than they have been at any point since World War II.

Someday, the Japanese economy will rebound, its real estate markets will recover, and its most prestigious areas will begin to see some appreciation in value and in lease rates. And Tiffany won't be a tenant -- it will be an owner, in the most prime location in Japan, perhaps the world.

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Quick Takes

The United Steelworkers of America -- apparently unable to receive assurances of no plant closings -- broke off contract talks with troubled Goodyear Tire & Rubber(NYSE: GT) over the weekend. The increased likelihood of a strike or lockout deflated Goodyear shares by about 6%.

Big money is changing hands again between Cablevision(NYSE: CVC) and Metro-Goldwyn-Mayer(NYSE: MGM). The former says it's buying back -- for $500 million --the 20% stake of Rainbow Media it sold to the latter two years ago for $825 million. Rainbow properties include American Movie Classics, the Independent Film Channel, and the Women's Entertainment cable channel.

Actual Reuters news story: "US Bancorp Piper Jaffray on Friday said it raised its price target for shares of Guidant Corp.(NYSE: GDT) to $43 from $39, citing an improved outlook. Shares of Guidant closed at $43.43 on the New York Stock Exchange on Thursday."

In local news, construction worker Cal Jessup said, "What kind of silly move is it to raise the price 'target' to $43 when the stock is already there?"

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Bob Bobala, Robert Brokamp, Mathew Emmert, Jeff Fischer, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Reggie Santiago, Kate Southerland, Dayana Yochim