Falling Microsoft Income Endangers Yahoo Bid 195
Dionysius, God of Wine and Leaf, points out a new wrinkle to Microsoft's pursuit of Yahoo. The most recent quarterly results, which saw Microsoft's earnings drop by 6% from the previous year (revenue from Windows alone was down 24%), have caused the stock to dip. This has reduced the value of the cash-and-stock offer from its original $44B to something nearer $40B. Yahoo, of course, has maintained all along that the original offer was lowball. A business professor is quoted: "Whatever leverage [Microsoft] built up in the last few days could be slipping away."
Re:The Offer is NOT LOWBALL (Score:4, Interesting)
Yahoo has only run into problems during the last 2 years, which is kinda short to declare the company dead. And their current P/E (with a price based on Microsoft's offer) is 35, which seems about average for most tech stocks. The day prior to Microsoft's bid, YHOO had dropped so low I was considering picking some up. I'm still kicking myself for putting off the research for a day so I could watch a movie.
Re:At least I'll have my... (Score:3, Interesting)
Microsoft used to make damn good mice and keyboards. I don't know about joysticks.
However, the new Microsoft mice and keyboards that I've tried out are not that good, really.
I really wouldn't worry.. (Score:3, Interesting)
The weak companies can burn to the ground to un-clutter their marketspace and allow healthy, new companies to grow in their wake.
The strong dollar led to rampant outsourcing in the late 90's/early 00's.
The US was an expensive place to do business.
As the dollar weakens, the US becomes more and more attractive for foreign investment. European companies (like Volkswagen, for example) see a supremely talented labor force with an exchange rate that's to die for. And we have indeed begun to see in-sourcing.
As this happens, the US economy gradually strengthens, the currency rebounds to the point where the country is no longer attracting foreign investment. Outsourcing begins to look more attractive for American companies. Etc. The pendulum swings again.
The sky is not falling. It's just that the tide is turning. It'll come back in again shortly.
Re:I really wouldn't worry.. (Score:3, Interesting)
Sure, as a currency reaches the extremes (both high and low) of its value, some people are hurt by that economically speaking.
But that's the point of a personal and social safety net.
I mean, the notion that a currency should be static just makes no sense whatsoever. A currency is essentially a "score" of the performance of a given economy. When an economy is strong, when growth prospects are strong, the currency is strong. This is because people are buying Dollars as it appears that they will increase in value.
If economies were static, currencies would be, too.
I tried to write an exmaple, but it's so inane that it's a waste of our time. There are about a trillion reasons why economies are not static. Changes in technology, demographics, natural disaster, man-made disaster, resources, etc.
This is going to be a rough patch for our economy. For most, the answer is that you should curtail spending NOW and give yourself some cushion. For some, it will mean outright financial ruin. That is unfortunate. But also, unavoidable.
* The Yuan is technically pegged to a "basket" of currencies but it's remained relatively inline with the Chinese-desired 8.2765:1 ratio for an awful long time.
Re:ummmm (Score:3, Interesting)
M$ failings have nothing to do with a lack of technical staff but everything to do with the Vista (P)OS, the user interface failing on Office 2007, the Zune edsel music device, pathetic xbox360 failure rates and, the failed re-branding of MSN to Live.
Basically at this stage they should not be hiring more but less. Not focusing on new OS's but on killing the failed Vista (P)OS and refining stale piss, all with more cost efficient staffing levels, that and diversifying into other technology areas. To achieve this, the first required step is to dump a tired and failed executive team who are looked into the same marketing B$ they were using a decade ago and which now is an embarrassing failure. Vista, a failure, but that OK it's only 'a work in progress', or going cap in hand to News Corp to beg for assistance in the Yahoo takeover, what a buffoon.