Looks like my wish is coming true. The weekend passed without a deal to merge Microsoft and Yahoo.
Even though it is still possible for Microsoft to initiate a hostile takeover bid, the issue seems have simmered down over the weekend and does not look very likely.
After reading a heated discussion in a personal finance forum earlier this week, I thought it would be a great idea to write my thoughts on one of the most intensely debated and discussed issues in finance. This is a question that I ask MBA grads during 1st round interviews. You’d be surprised how often very smart people can sound very stupid when asked if markets are efficient, and what to do about it.
There are two basic schools of thought in regards to investing in the stock market. In one corner we have the active investor. She believes that markets are inherently inefficient. An inefficient market is one where prices do not accurately reflect the value of an asset at that point in time. Therefore, some stocks will be “cheap” and others “expensive”. The goal of the active investor is to purchase the “cheap” stocks and then sell when they match/exceed their true value.
On the flip side we have the passive investor. He believes that the market is efficient and all prices accurately portray the true value of an asset. There are no “cheap” stocks. Everything is priced to perfection for that point in time. Depending on how far the investor is on the passive scale, they either base purchases purely on future expectations, or opt for the ultimate in passive investing: indexing.
Which is the better approach? Read more
I didn’t see this one coming. Roast Beef purveyor Arby’s parent company is buying Wendy’s for $2.34 billion, and a mountain of curly fries.
Here’s where things get weird and wonderful.
- Wendy’s International has a market capitalization of about $2.2 billion USD (market cap is simply the value of the company based on share price multiplied by # of shares outstanding)
- Arby’s parent company Triarc Cos. has a market cap of $597 million USD.
So Arby’s is buying Wendy’s even though it is worth about one quarter LESS. Those wacky Investment Bankers sure know how to do the strange and seemingly impossible.
I don’t really eat this kind of fast food and I have no idea if these two brands will make a successful marriage. All I know is that I’m getting hot and can use a Frosty. Maybe I can offer 25% of the listed price, or 3 curly fries instead of cash…..
Apple released the following earnings summary:
“APPLE REPORTS RECORD SECOND QUARTER RESULTS
APPLE INTERNATIONAL CO LTD Q2 SHR $1.16
SEES Q3 2008 SHR ABOUT $1.00
Q2 REVENUE $7.51 BLN
SEES Q3 2008 REVENUE ABOUT $7.2 BLN
SAYS QUARTERLY IPHONE(TM) SALES WERE 1,703,000
SAYS APPLE SHIPPED 2,289,000 MACINTOSH COMPUTERS DURING THE QUARTER
SAYS SOLD 10,644,000 IPODS DURING THE QUARTER”
This info was pulled from the news release off the wire service, sorry for the weird format.
It should be noted that Apple’s shares slipped about 1% during after hours trading. Apparently, their projections for the upcoming third quarter were a bit lower than expected.
I’m out of the office today, but I’ve written this special feature about choosing a stock broker instead.
For many people, navigating the world of investment products and services is a daunting task. A stock broker can be a great way of saving time and effort by having a professional do the research and look after your finances. The process of selecting this individual can become as stressful and daunting as choosing a house or planning that perfect trip. You’ve worked hard for your money and you want it treated right, so read on and enjoy the tips!
