I'm going to get modded flaimbait for this but I don't care.
I'm poor. I make under $30k a year and live in Los Angeles. Yet despite that, I am able to save 25% of my income each year and invest it, some of it in oil stocks to help offset the cost of commuting. The problem in this country is not that poor people cannot save and cannot live a decent life, it's that they choose not to. They choose to have children before they can afford it. They choose not to take out loans to go to college. They choose to rack up huge amounts of credit card debt and only make the minimum payment each month. I have no sympathy for these people, when I with the same paycheck can live a decent life and take steps to grow my wealth rather than squander it.
This isn't the 1890s, its not just the "high and mighty rich investor" that can make money of the stock market. If you can save $100 a week, you have no excuse for not partaking in the the profit making, and you are reckless for not doing so.
There is more behind the inflation of the prices you cited than just the devaluation of the dollar, and lack of "tangible money."
A doctor's visit that cost $5 when I was a kid (the 60's) is now $90 (18x);
Yes, but doctors back then didn't have to pay for a sizable support staff, malpractice insurance, or diagnostic tests which were unavailable back then, but are practically mandatory (if you don't wantto get sued) now. For example, MRIs, CAT Scans, endoscopes, and a plethora of other technology was not even around when you were a kid, yet are standard to the level of care you expect now. Doctors used to base their diagnosis more off their own gut and experience, and less off of data they could objectively obtain back in the 60s. That is less so the case now.
In sum, most of the cost increase in medicine has to do with the cost of practicing it.
fuel is up from 30 cents to three bucks (10x)
Higher demand, and lack of cheap sources of oil (i.e., having to extract oil form deep water fields, and heavy crude fields) account for all of the increase here. The price is also being driven up by speculation that supply might have peaked as well (i.e., Peak Oil Theory). The price of oil would be going up regardless if we were on the gold, silver, or platinum back dollar.
cars from a few thousand to tens of thousands (10x to 20x and more)
One word, unions. If you look at the costs (at least for US manufacturers), the percentage of money they have spent on making cars versus their total cost has pretty much been going down in a straight line since the 1960s. This is mainly due the increasing amounts of money they have to put into pension and health plans for their workers. The Big Three are more like pension funds now than they are like auto producers. As a consequence of course, the cost of their cars goes up, and the quality of them goes down.
houses... houses are insane.
Talk to me about that in 2 years when housing values have bottomed. In highly inflated areas, there was a lot of speculation, and the bubble has now collapsed. For example in Southern California, the average house price has fallen 12% in the last year. They are forecasting another 15% fall this year.
In the face of all of this, minimum wage has risen from $1.25 in 1965 to $5.85, an increase of 4.7x altogether.
Well yes, but lets look at all of the things a minimum wage can buy you now that it couldn't in 1960. In the 1960s an average computer cost in the hundreds of thousands to millions of dollars. You can now get a cheap one for $300 dollars. In the 1960s the cheapest car you could buy had a life expectancy of 3-5 years tops. Now you can buy a Kia with 10 year warranty that will probably last much longer than that. In the 1960s few apartments came with air conditioning and a good portion did not even come with heating (especially if you were not in a cold climate). Now most apartments come with at least a window unit that does both. Hell in the 1960s only the well off could afford a microwave. Now I'd surmise that more people own functioning microwaves then own functioning stoves and ovens.
I could go on and on, but the fact is our standard of living today, even at the low end, is much higher than it was in the 1960s. Remember, in the 1960s there were still sizable segments of the rural south no access to electricity or running water. What was "middle class" back then would be borderline poverty right now in most instances. Would you consider a person who owns a black and white television now to be well off? Your argument fails to take into account the effect of technology on the cost and quality of living.
If you asked most people whether they would rather be alive today or in the 1960s, I'd bet most will choose today.
What long term benefit will accrue for letting Yahoo live and letting their arrogant management run the company into the ground?
Their profits are dwindling, their effort to stimulate said profits are failing, and they are cutting their workforce by 7% because of this. I have friends at Yahoo, and the smarter ones have been looking to jump ship for months because they can see the writing on the wall. A buyout at MS would at least give these people a reason to stay (assuming MS only fires the chaff).
I think a refusal of the buyout would only accelerate a brain drain from Yahoo, as it would confirm management's arrogance, which so far has directly resulted in the company's current precarious position. Tell me, as an employee, would you rather be fired from a company now, or continue to work for another three years under constant fear/threat of being fired?
IMO, there is no longterm benefit to Yahoo's status quo, and other than MS, no one has put together a vision to change it.
The problem with American business and the financial "industry" built around it is that there is actually no interest at all in sustainable business, but rather exponential profit growth at all cost, even the death of the company itself. The company dies, the money vultures move on to the next target.
I challenge you to show how Yahoo is a sustainable business. Before the MS offer, they just announced that they would have to fire 1000 employees. The company's revenues year over year are shrinking because their management cannot find a way to translate all of their site traffic into money. They have a history of failing to meet their own projections. At the very least this a poorly run company, and with the coming recession, I do not think its sustainability is out of the question.
Second as an individual that owns stock, and thus is one of these "money vultures," why should I or any investor want to own Yahoo's stock, outside of takeover speculation. The company offers no dividend, which means the only return on investment I will see in it is from the company's growth, something it has clearly failed to predict, manage, or deliver on.
You claim that the entire financial industry is built on "exponential growth" but you fail to ignore the fact that Yahoo abd most tech stocks choose to hold their stock out as a growth stock, meaning they can only justify their stock price by *gasp* growing. If Yahoo were too come out tomorrow, declare a dividend (like say Altria), and pay some of the $1.5 billion dollars in cash they have to their shareholders, than their stock would finally have some intrinsic worth NOT tied to their rate of growth. (Note: For an explaination of growth stocks vs. value stocks, check this link out.)
Yup, if its an stock-for-stock deal, the conversion of the Yahoo stock into MS stock is used to cover their short position, and they make the spread between the two companies in profit.
In a stock for stock merger, the acquirer proposes to buy the target by exchanging its own stock for the stock of the target. An arbitrageur may then short sell the acquirer and buy the stock of the target. This process is called "setting a spread". After the merger is completed, the target's stock will be converted into stock of the acquirer based on the exchange ratio determined by the merger agreement. The arbitrageur delivers the converted stock into his short position to complete the arbitrage.
The information below is present in the wikipedia article I linked to originally which you clearly did not read. If you are still unclear after reading this, then please feel free to take a course in finance or buy a book off Amazon.
Risk arbitrageurs buy shares of the target, and short shares of the acquiror
This sentence describes a two-step transaction to looks something like this: (1) Buy shares of the target company. (2) Short shares of the acquiring company.
Thus, at the end of this transaction, the arbitrageur's position is now this, (1) Owners in stock (i.e., Long) of the target. (2) Short in stock (i.e., Short) of the acquiror.
Remember, until the merger or buyout is finalized, the target and acqurior are two separate companies with two separately trading stocks. Thus, it is possible to be long of one of the stocks and short of the other.
Risk arbitrageurs do not buy and short the exact same stock. I honestly do not know how you could have construed the sentence to mean such.
It doesn't make sense at the fundamental level though. Yahoo's biggest problem compared to Google is its profit margins, which are comparably lower because it has to pay the cost of acquiring content, while Google does not. If Google were to take on content generation as a business, its profit margins would necessarily have to decline as well. You're right in the sense that Yahoo could benefit from Google's ad technology, but Google sells adsense and the like as a service to anyone who wants to pay for it so Yahoo doesn't need a merger with Google to benefit there.
No, I do understand. When you "short a stock" so to speak, your broker borrows stock from other accounts within the brokerage and sells it on the open market. You get the cash from this sale, but in turn are ultimately responsible for returning the stock to its original owner. This can be accomplished by either voluntarily buying the stock on the open market at a later date, or by your broker "calling-in" your short, which forces you to buy at whatever the price is when its called in. You ultimately hope to profit from a short position by being able to buy the stock back cheaper than you short sold it for, allowing you to profit the difference.
You can short sell almost any stock on the open market with regularity. I know, I do it frequently.
All of what you said is totally true, but dumping usually exists in mature markets, not emerging ones since companies can use the cash reserves and leverage that they have developed over time to squeeze out smaller competitors. That definitely was not the case for pets.com in the dot-com boom days. My use of pets.com as an illustration was less a comment on dumping as a strategy, but more a comment on the general idiocy of dot-com era management.
500 million users might be every account ever created
Remember Yahoo isn't just used in the US, it has international versions as well. There's six billion people in the world and probably over 2 billion have regular internet access by now (my guess, no source). 25% of internet users using Yahoo regularly is not a stretch of the imagination by any means.
i have a sneaking suspicion there is another smaller.com bubble forming
Not really, remember the first dot-com bubble was caused by people trying to value companies that produced no profit and used business model's no one had ever tried out before. (My favorite was pets.com which insisted on selling most of its merchandise at below cost. Genius move guys!) It's been over 10 years since then and company's have figured out how to make money online, which makes valuing the price of their stock much easier.
You're right in thinking Yahoo's vision of themselves is inflated though. Remember their market cap was about 2/3 of what it is now before the bid, and that's right about were they belong given management's horrendous execution.
Yahoo's clicks and page view may be high, but unlike Google they have failed to turn that into corresponding ad revenue, which significantly hampers their top and bottom line. In that sense they are not sinking so much as slowly falling behind Google. I'd analogize it to the Detroit Automakers versus the Japanese ones back in the late 1970s and early 1980s. They weren't doing bad, but they were not doing enough to maintain their lead over the Japanese. The automakers did that out of shear arrogance, and while I don't think Yahoo is as arrogant as they were, I get the sense from some of my friends working there that they are a lot smugger than they should be. For example, they were shocked at the new of job cuts, which is something anyone objectively following the company saw coming due to its declining profit margins.
As for a Yahoo-Google merger, I don't really think the *buzzword* synergies match up. Yahoo is a content producer. They make a lot of their money off of things like fantasy sports leagues, and revenue from their various blogs. Google on the other hand is a content aggregator and makes all of its money off of collecting and organizing other people's content. While they share things in common like email, groups, and stock quotes (Yahoo's financial section is by far one of the best free ones out there), the company's operate off two different strategies, and unless Google wants to get into content generation a straight out merger makes not sense whatsoever. If however you split off (i.e., fire) the content generation section and just take the technology though I think to a Google, buying Yahoo makes sense. After all, that's basically what Microsoft is after in my opinion.
Your right on anti-trust though. The DOJ will have a field day with this one just like they are having with the Sirius-XM deal. IMO, neither of these would be worse for the market than all of the oil company consolidation we saw at the turn of the century.
But make no mistake, Microsoft needs Yahoo more than Google needs Yahoo.
Oh you mean like this? Yah I think we've seen that one played out before and it didn't end well for the big media company. And just remember, AOL merged at its peak, Yahoo has clearly seen better days.
Risk arbitrageurs buy shares of the target, and short shares of the acquiror. As I said before, in these situations the target's shares will appreciate to the buyout price and the acquiror's price will depreciate by the cost per share of the acquisition. Therefore, assuming the deal goes through, that is why this strategy makes sense. Of course if the deal doesn't go through the arbitrageurs really take it on the chin, which makes these kinds of pair trades very risky.
I agree with your points here. Microsoft is definitely not king of search, and I think they are trying to buy Yahoo to make up for their deficiencies in that area since Yahoo has a great infrastructure and Microsoft is betting that they can bring in management that will make better use of it than Yahoo's current management. I'm not saying they'll succeed, I'm just pointing out their rationale. My original post was directed at the great-grandparent's post, which implied that Microsoft, if it buys Yahoo, should not touch anything and let Yahoo run itself. We both know that hasn't been working out so well recently.
From a business perspective, I think Microsoft has to fuck with Yahoo. The company's profit margins have been falling hand over fist for the last couple of years, and they've got way to much bloat, as evidenced by the fact that they will have to lay off 1000 people this year. They've gone through at least two CEO changes in the last year, and despite the increasing viewership of their sites, their ad revenue has been flat to decreasing. I think Microsoft must absolutely make management and culture changes to Yahoo unless it wants to see its purchase just fritter away and become the cash sink that AOL has become to Time Warner.
And I wonder who's buying all of these, in reality? Someone who'd pay 31 dollars for a share, when they could instead buy it in-market at 28?
To answer your first question, they are called risk arbitrageurs. They essentially buy the stock of the target company and short sell the stock of the acquiring company. They make a profit as the target's stock price appreciates to the offer price and as the acquiror's price decreases because of the costs of the takeover (e.g., cash paid out, dilution in stock value, debt taken on).
Their presence, and the reason Yahoo!'s stock only trades at ~$28 is due to the risk that the deal will not close. Deals have to go through a lot of vetting both by the government (DOJ, FTC) and by the parties making them. There is always a risk that at some point along the way either the government will not approve or one of the parties will get cold feet. This is especially true of hostile takeovers, which this offer is similar too, because the target is by its nature an unwilling participant.
As for why Microsoft is not buying in the open market, the short story is that there are a lot of rules and regulations that would just make it a stupid idea. For example, their are lots of disclosure rules that go into effect as an individual (or corporation's) stake in another company increases. Since Microsoft cannot buy all of Yahoo!'s shares on the open market all at once, it would have to fulfill these requirements and essentially announce to the world that it is acquiring Yahoo! before it has done so. This would probably cause a lot of investors to hold out from selling in an effort to get Microsoft to pay more for their shares. If Microsoft is far enough along in its purchases, it would have to capitulate because the cost of backing out and dumping all of its shares would be too high.
That's where the risk arbitrageurs step into the picture in a funcitonal way. Microsoft essentially announces what it will pay. All of the antsy Yahoo! shareholders sell to the arbitrageurs who then must try to help the deal close so they can make their money. This effectively allows Microsoft to offer $31 a share without incurring any of the hold out risk inherent in trying to buy in the open market.
Well if you're paying less for them on Steam than you are for the CD, I'd venture that the discount you get factors in the loss you suffer by not being able the resell them, assuming that you could even resell a used game for $20 ($50 for the CD minus $30 for the Steam copy).
A policeman can arrest you for anything, whether its valid or not is to be decided in the courts later. After the arrest, they can search the "area" you were arrested in. Anything they find, even if its not related to why you were arrested, is fair game to be used against you for new charges.
This is so wrong I don't even know where to begin. First, while it's true that any cop can arrest you first and worry about the legality of any search incident to arrest later, no court would allow the fruits of an ILLEGAL search to be admissible in court. The doctrine is called the Exclusionary Rule and forces courts to exclude as proof of guild, any evidence from trial obtained in violation of an accused's Constitutional rights. Additionally there is the Fruit of the Poisonous Tree Doctrine the further excludes any evidence obtained from illegally obtained evidence (i.e., the fruits) absent for a few special circumstances (e.g., the fruit would have been inevitably discovered).
In response to your hypothetical, if the arrest of the person for speeding was deemed lawful, then there is not problem with the search legally, and no problem from a policy perspective because the policeman has committed no illegal act or malfeasance. After all what violation of a person's rights has occurred if the police arrest them in a situation where the police can do so lawfully?
By the same toke, if the police arrest is found to be unlawful, then the search is no longer incident to a lawful arrest and therefore is also unlawful (i.e., it violates the Fourth Amendment). Therefore the Exclusionary Rule and Fruit of the Poisonous Tree Doctrine would necessarily exclude any evidence found in that search and any of its fruits as well.
Finally, if you were hiding illegal contraband in your car (e.g., drugs, weapons, kiddie porn), why should the Constitution afford you any rights to do so? It has been stated in many Supreme Court cases that a person has no constitutional right to hold contraband. Should we protect someone who is already doing something illegal (i.e., possessing contraband), just because they were stupid enough to get caught doing something else illegal (i.e., speeding)? It's seems reasonable to me that the guy who's speeding assumes the risk, that he'll get caught for any other crimes he commits while speeding. If he were speeding, pulled over by a cop and found to be drunk, there'd be no problem with any arrest and search there.
There is no problem so long as you aren't forcing them to make promises they don't want to make in which case you're simply teaching them that promises mean nothing and can be broken. If a student wants to join the school sports team because he enjoys the sport and wants to play with his friends they are most likely going to sign any pieces of paper you put in front of them in order to do that.
This logic is kind of flawed. If you rented an apartment to someone, and they put a giant hole in one of the walls, would you not hold them responsible for fixing it merely because he said, "I didn't know that the lease stated that I couldn't put giant holes in walls. I never read it and just signed it because I really wanted the apartment and was going to sign anything you put in front of me to get it. You shouldn't hold me responsible."
You're the sort of tosser that thinks 100 page EULAs are perfectly reasonable aren't you.
Maybe, maybe not, it depends on the wording in the EULA. I think, a person should be expected to abide by terms that an objective bystander would view as reasonable. For example, I think a condition prohibiting the user of the software from making copies of it to redistribute or resell is an acceptable term. Conversely, I think a term requiring the user to hold the manufacturer harmless for any and all damage or data loss that might result from installing the software is arguably unreasonable and something any person would not expect to be agree to when they click the accept button.
Sure they weren't forced to participate in interscholastic sports. However there's a lot of pressure to do so from peers, parents, teachers and the institutions themselves. Kids that don't do so are often teased, bullied or labelled as nerds.
There are plenty of alternatives to participating in interscholastic sports, for example independent leagues or club teams.
At any rate why should peer pressure be enough by itself to invalidate a contract? It's not a valid defense if you commit a crime ("I stabbed the guy because my friends said I'd be a pussy if I didn't").
Most schools do not have a "no cut" policy for their more popular sports. When you try out for the team, there is an implicit agreement that if you are not good enough to make the team, you will not be given a spot on the roster. Much like kids that refuse to sign the pledge and do not participate, the kids who get cut will also suffer the same ridicule and be ostracized. Does that mean we should guarantee every kids that wants to participate a spot on the team?
So now you're saying that team sports aren't part of a healthy well rounded education?
Whether they are or not is moot point, the school has no obligation to allow anyone that wants to participate in them. See the discussion of of tryouts and roster cutting above.
and if they sat on their backsides and did no sports you'd be the first to blame them and their parents for their lack of fitness or weight problems.
Quit with the ad hominem attacks. Attack my argument, not me. Besides, there's always good old fashioned PE. You don't need to be on the football team to get exercise. Dodgeball anyone?
No coercion is involved, but here (probably unlike US) legislation says that any unjust terms in such agreements can be determined null and void through court, in mass-agreements (where a company sets the same agreement for a multitude of customers) - since the people aren't practically able to negotiate these agreements.
You're describing what is known as a contract of adhesion. Contract law varies from state to state, and I do not know whether Minnesota generally enforces these kinds of contracts, but if they do not, the basic standard for determining enforceability is the same as your country (i.e., whether the terms in question are unjust or unreasonable).
That said, I do not think a court would find a pledge promising not to drink alcohol unjust or unreasonable. Morality aside, consuming alcohol is illegal for persons under the age of 21 in Minnesota, so the pledge is in fact a promise not to break the law.
This seems perfectly reasonable since teens make such promises all the time. For example, when teenagers get their driver's license (at age 16) they promise not to drink alcohol and drive under penalty of forfeiting their license. The pledge in question is sufficiently analogous to this promise such that it is probably just and reasonable to "force" them to promise not to drink alcohol in exchange for participating in school sponsored sports.
Additionally, it's worth noting that the school is a state government organization, and since the state is the ultimate regulator of contract law, it can set whatever terms on its contracts that it pleases, so long as those terms do not violate the state or federal constitution.
Absolutely nothing, because it would be impossible to prove that what's in those containers is alcohol.
First off, as this other post has pointed out, under Minnesota Law, possession of an alcoholic beverage creates an rebutable presumption of the intent to consume said beverage. The pictures provide evidence that the teens possessed alcoholic beverages, and thus, the police probably have enough to charge the teens if they so choose. It would be the teen's burden to show that the containers contained something other than alcohol.
However, lets get to my bigger point. These photographs (WARNING: GRAPHIC, NSFW) might show that the men in them were victims of degrading torture, or it might show that these men are having a consensual homosexual orgy with and have a fetish for autoerotic asphyxiation . Heck, those photographs might also show the smiling people in military uniforms as would be torturers, or it might show them as a smiling couple on vacation at a Hedonism resort.
The mere fact that the acts conveyed in a photograph may have multiple interpretations does not deter from the fact that there is probably one reasonably likely interpretation that most people would adopt. Sure those Coors cans could all contain apple juice, and that fifth of Absolut could actually just be water; sure those kids could just get off on pretending to drink alcohol but would abhor the thought of actually drinking some until they turned 21, but really what are the odds?
I agree that the police would probably do nothing, but it has more to do with the expediency of not acting (i.e., not pissing off the parents, or letting the parents handle it) rather than lacking any evidence on which to arrest and book the kids.
This isn't mandatory at all. How about not participating in school sanctioned athletics if you find the pledge's requirements to onerous? There are plenty of club teams and non-affiliated leagues for sports in the US.
A student has no guaranteed right to participate on the school's sports teams anyway. EPHS, like most schools in the US, requires students to go through tryouts for certain sports teams, implying that a student is not guaranteed a spot on a team even if he/she willingly and knowingly signs the pledge. The morality of the pledge's goals aside, I fail to see how signing this pledge is anywhere near coercive.
the simple fact is that every one of them was co-erced into signing such a promise.
Wrong, they were not coerced into signing that agreement. None of these students was required to participate in interscholastic competitive sports, and participation in such sports were not required as a condition of graduation, but rather completely voluntary. While I doubt any of these students read the pledge they signed (still not a valid excuse), they were in no way forced to sign it if they disagreed with the school's/state's policy governing student athletics.
If they disagreed they could have simply abstained from playing on the school's teams. If they still wanted to play the sport, I'm pretty sure there is a club team or non-affiliated league they could have joined.
You're basically saying that you KNOW they signed it because they have no choice in the matter if they want to participate in school.
Again, that is a mischaracterization, the agreement in no way impinged on their right to an education. They free attend classes, irregardless of having signed the pledge, the pledge was only required as a condition to participate in the school's athletic programs.
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I'm going to get modded flaimbait for this but I don't care.
I'm poor. I make under $30k a year and live in Los Angeles. Yet despite that, I am able to save 25% of my income each year and invest it, some of it in oil stocks to help offset the cost of commuting. The problem in this country is not that poor people cannot save and cannot live a decent life, it's that they choose not to. They choose to have children before they can afford it. They choose not to take out loans to go to college. They choose to rack up huge amounts of credit card debt and only make the minimum payment each month. I have no sympathy for these people, when I with the same paycheck can live a decent life and take steps to grow my wealth rather than squander it.
This isn't the 1890s, its not just the "high and mighty rich investor" that can make money of the stock market. If you can save $100 a week, you have no excuse for not partaking in the the profit making, and you are reckless for not doing so.
Yes, but doctors back then didn't have to pay for a sizable support staff, malpractice insurance, or diagnostic tests which were unavailable back then, but are practically mandatory (if you don't wantto get sued) now. For example, MRIs, CAT Scans, endoscopes, and a plethora of other technology was not even around when you were a kid, yet are standard to the level of care you expect now. Doctors used to base their diagnosis more off their own gut and experience, and less off of data they could objectively obtain back in the 60s. That is less so the case now.
In sum, most of the cost increase in medicine has to do with the cost of practicing it.
Higher demand, and lack of cheap sources of oil (i.e., having to extract oil form deep water fields, and heavy crude fields) account for all of the increase here. The price is also being driven up by speculation that supply might have peaked as well (i.e., Peak Oil Theory). The price of oil would be going up regardless if we were on the gold, silver, or platinum back dollar.
One word, unions. If you look at the costs (at least for US manufacturers), the percentage of money they have spent on making cars versus their total cost has pretty much been going down in a straight line since the 1960s. This is mainly due the increasing amounts of money they have to put into pension and health plans for their workers. The Big Three are more like pension funds now than they are like auto producers. As a consequence of course, the cost of their cars goes up, and the quality of them goes down.
Talk to me about that in 2 years when housing values have bottomed. In highly inflated areas, there was a lot of speculation, and the bubble has now collapsed. For example in Southern California, the average house price has fallen 12% in the last year. They are forecasting another 15% fall this year.
Well yes, but lets look at all of the things a minimum wage can buy you now that it couldn't in 1960. In the 1960s an average computer cost in the hundreds of thousands to millions of dollars. You can now get a cheap one for $300 dollars. In the 1960s the cheapest car you could buy had a life expectancy of 3-5 years tops. Now you can buy a Kia with 10 year warranty that will probably last much longer than that. In the 1960s few apartments came with air conditioning and a good portion did not even come with heating (especially if you were not in a cold climate). Now most apartments come with at least a window unit that does both. Hell in the 1960s only the well off could afford a microwave. Now I'd surmise that more people own functioning microwaves then own functioning stoves and ovens.
I could go on and on, but the fact is our standard of living today, even at the low end, is much higher than it was in the 1960s. Remember, in the 1960s there were still sizable segments of the rural south no access to electricity or running water. What was "middle class" back then would be borderline poverty right now in most instances. Would you consider a person who owns a black and white television now to be well off? Your argument fails to take into account the effect of technology on the cost and quality of living.
If you asked most people whether they would rather be alive today or in the 1960s, I'd bet most will choose today.
What long term benefit will accrue for letting Yahoo live and letting their arrogant management run the company into the ground?
Their profits are dwindling, their effort to stimulate said profits are failing, and they are cutting their workforce by 7% because of this. I have friends at Yahoo, and the smarter ones have been looking to jump ship for months because they can see the writing on the wall. A buyout at MS would at least give these people a reason to stay (assuming MS only fires the chaff).
I think a refusal of the buyout would only accelerate a brain drain from Yahoo, as it would confirm management's arrogance, which so far has directly resulted in the company's current precarious position. Tell me, as an employee, would you rather be fired from a company now, or continue to work for another three years under constant fear/threat of being fired?
IMO, there is no longterm benefit to Yahoo's status quo, and other than MS, no one has put together a vision to change it.
I challenge you to show how Yahoo is a sustainable business. Before the MS offer, they just announced that they would have to fire 1000 employees. The company's revenues year over year are shrinking because their management cannot find a way to translate all of their site traffic into money. They have a history of failing to meet their own projections. At the very least this a poorly run company, and with the coming recession, I do not think its sustainability is out of the question.
Second as an individual that owns stock, and thus is one of these "money vultures," why should I or any investor want to own Yahoo's stock, outside of takeover speculation. The company offers no dividend, which means the only return on investment I will see in it is from the company's growth, something it has clearly failed to predict, manage, or deliver on.
You claim that the entire financial industry is built on "exponential growth" but you fail to ignore the fact that Yahoo abd most tech stocks choose to hold their stock out as a growth stock, meaning they can only justify their stock price by *gasp* growing. If Yahoo were too come out tomorrow, declare a dividend (like say Altria), and pay some of the $1.5 billion dollars in cash they have to their shareholders, than their stock would finally have some intrinsic worth NOT tied to their rate of growth. (Note: For an explaination of growth stocks vs. value stocks, check this link out.)
Yup, if its an stock-for-stock deal, the conversion of the Yahoo stock into MS stock is used to cover their short position, and they make the spread between the two companies in profit.
(emphasis added)
This sentence describes a two-step transaction to looks something like this:
(1) Buy shares of the target company.
(2) Short shares of the acquiring company.
Thus, at the end of this transaction, the arbitrageur's position is now this,
(1) Owners in stock (i.e., Long) of the target.
(2) Short in stock (i.e., Short) of the acquiror.
Remember, until the merger or buyout is finalized, the target and acqurior are two separate companies with two separately trading stocks. Thus, it is possible to be long of one of the stocks and short of the other.
Risk arbitrageurs do not buy and short the exact same stock. I honestly do not know how you could have construed the sentence to mean such.
It doesn't make sense at the fundamental level though. Yahoo's biggest problem compared to Google is its profit margins, which are comparably lower because it has to pay the cost of acquiring content, while Google does not. If Google were to take on content generation as a business, its profit margins would necessarily have to decline as well. You're right in the sense that Yahoo could benefit from Google's ad technology, but Google sells adsense and the like as a service to anyone who wants to pay for it so Yahoo doesn't need a merger with Google to benefit there.
No, I do understand. When you "short a stock" so to speak, your broker borrows stock from other accounts within the brokerage and sells it on the open market. You get the cash from this sale, but in turn are ultimately responsible for returning the stock to its original owner. This can be accomplished by either voluntarily buying the stock on the open market at a later date, or by your broker "calling-in" your short, which forces you to buy at whatever the price is when its called in. You ultimately hope to profit from a short position by being able to buy the stock back cheaper than you short sold it for, allowing you to profit the difference.
You can short sell almost any stock on the open market with regularity. I know, I do it frequently.
All of what you said is totally true, but dumping usually exists in mature markets, not emerging ones since companies can use the cash reserves and leverage that they have developed over time to squeeze out smaller competitors. That definitely was not the case for pets.com in the dot-com boom days. My use of pets.com as an illustration was less a comment on dumping as a strategy, but more a comment on the general idiocy of dot-com era management.
Remember Yahoo isn't just used in the US, it has international versions as well. There's six billion people in the world and probably over 2 billion have regular internet access by now (my guess, no source). 25% of internet users using Yahoo regularly is not a stretch of the imagination by any means.
Not really, remember the first dot-com bubble was caused by people trying to value companies that produced no profit and used business model's no one had ever tried out before. (My favorite was pets.com which insisted on selling most of its merchandise at below cost. Genius move guys!) It's been over 10 years since then and company's have figured out how to make money online, which makes valuing the price of their stock much easier.
You're right in thinking Yahoo's vision of themselves is inflated though. Remember their market cap was about 2/3 of what it is now before the bid, and that's right about were they belong given management's horrendous execution.
Yahoo's clicks and page view may be high, but unlike Google they have failed to turn that into corresponding ad revenue, which significantly hampers their top and bottom line. In that sense they are not sinking so much as slowly falling behind Google. I'd analogize it to the Detroit Automakers versus the Japanese ones back in the late 1970s and early 1980s. They weren't doing bad, but they were not doing enough to maintain their lead over the Japanese. The automakers did that out of shear arrogance, and while I don't think Yahoo is as arrogant as they were, I get the sense from some of my friends working there that they are a lot smugger than they should be. For example, they were shocked at the new of job cuts, which is something anyone objectively following the company saw coming due to its declining profit margins.
As for a Yahoo-Google merger, I don't really think the *buzzword* synergies match up. Yahoo is a content producer. They make a lot of their money off of things like fantasy sports leagues, and revenue from their various blogs. Google on the other hand is a content aggregator and makes all of its money off of collecting and organizing other people's content. While they share things in common like email, groups, and stock quotes (Yahoo's financial section is by far one of the best free ones out there), the company's operate off two different strategies, and unless Google wants to get into content generation a straight out merger makes not sense whatsoever. If however you split off (i.e., fire) the content generation section and just take the technology though I think to a Google, buying Yahoo makes sense. After all, that's basically what Microsoft is after in my opinion.
Your right on anti-trust though. The DOJ will have a field day with this one just like they are having with the Sirius-XM deal. IMO, neither of these would be worse for the market than all of the oil company consolidation we saw at the turn of the century.
But make no mistake, Microsoft needs Yahoo more than Google needs Yahoo.
Oh you mean like this? Yah I think we've seen that one played out before and it didn't end well for the big media company. And just remember, AOL merged at its peak, Yahoo has clearly seen better days.
Risk arbitrageurs buy shares of the target, and short shares of the acquiror. As I said before, in these situations the target's shares will appreciate to the buyout price and the acquiror's price will depreciate by the cost per share of the acquisition. Therefore, assuming the deal goes through, that is why this strategy makes sense. Of course if the deal doesn't go through the arbitrageurs really take it on the chin, which makes these kinds of pair trades very risky.
I agree with your points here. Microsoft is definitely not king of search, and I think they are trying to buy Yahoo to make up for their deficiencies in that area since Yahoo has a great infrastructure and Microsoft is betting that they can bring in management that will make better use of it than Yahoo's current management. I'm not saying they'll succeed, I'm just pointing out their rationale. My original post was directed at the great-grandparent's post, which implied that Microsoft, if it buys Yahoo, should not touch anything and let Yahoo run itself. We both know that hasn't been working out so well recently.
From a business perspective, I think Microsoft has to fuck with Yahoo. The company's profit margins have been falling hand over fist for the last couple of years, and they've got way to much bloat, as evidenced by the fact that they will have to lay off 1000 people this year. They've gone through at least two CEO changes in the last year, and despite the increasing viewership of their sites, their ad revenue has been flat to decreasing. I think Microsoft must absolutely make management and culture changes to Yahoo unless it wants to see its purchase just fritter away and become the cash sink that AOL has become to Time Warner.
To answer your first question, they are called risk arbitrageurs. They essentially buy the stock of the target company and short sell the stock of the acquiring company. They make a profit as the target's stock price appreciates to the offer price and as the acquiror's price decreases because of the costs of the takeover (e.g., cash paid out, dilution in stock value, debt taken on).
Their presence, and the reason Yahoo!'s stock only trades at ~$28 is due to the risk that the deal will not close. Deals have to go through a lot of vetting both by the government (DOJ, FTC) and by the parties making them. There is always a risk that at some point along the way either the government will not approve or one of the parties will get cold feet. This is especially true of hostile takeovers, which this offer is similar too, because the target is by its nature an unwilling participant.
As for why Microsoft is not buying in the open market, the short story is that there are a lot of rules and regulations that would just make it a stupid idea. For example, their are lots of disclosure rules that go into effect as an individual (or corporation's) stake in another company increases. Since Microsoft cannot buy all of Yahoo!'s shares on the open market all at once, it would have to fulfill these requirements and essentially announce to the world that it is acquiring Yahoo! before it has done so. This would probably cause a lot of investors to hold out from selling in an effort to get Microsoft to pay more for their shares. If Microsoft is far enough along in its purchases, it would have to capitulate because the cost of backing out and dumping all of its shares would be too high.
That's where the risk arbitrageurs step into the picture in a funcitonal way. Microsoft essentially announces what it will pay. All of the antsy Yahoo! shareholders sell to the arbitrageurs who then must try to help the deal close so they can make their money. This effectively allows Microsoft to offer $31 a share without incurring any of the hold out risk inherent in trying to buy in the open market.
Well if you're paying less for them on Steam than you are for the CD, I'd venture that the discount you get factors in the loss you suffer by not being able the resell them, assuming that you could even resell a used game for $20 ($50 for the CD minus $30 for the Steam copy).
This is so wrong I don't even know where to begin. First, while it's true that any cop can arrest you first and worry about the legality of any search incident to arrest later, no court would allow the fruits of an ILLEGAL search to be admissible in court. The doctrine is called the Exclusionary Rule and forces courts to exclude as proof of guild, any evidence from trial obtained in violation of an accused's Constitutional rights. Additionally there is the Fruit of the Poisonous Tree Doctrine the further excludes any evidence obtained from illegally obtained evidence (i.e., the fruits) absent for a few special circumstances (e.g., the fruit would have been inevitably discovered).
In response to your hypothetical, if the arrest of the person for speeding was deemed lawful, then there is not problem with the search legally, and no problem from a policy perspective because the policeman has committed no illegal act or malfeasance. After all what violation of a person's rights has occurred if the police arrest them in a situation where the police can do so lawfully?
By the same toke, if the police arrest is found to be unlawful, then the search is no longer incident to a lawful arrest and therefore is also unlawful (i.e., it violates the Fourth Amendment). Therefore the Exclusionary Rule and Fruit of the Poisonous Tree Doctrine would necessarily exclude any evidence found in that search and any of its fruits as well.
Finally, if you were hiding illegal contraband in your car (e.g., drugs, weapons, kiddie porn), why should the Constitution afford you any rights to do so? It has been stated in many Supreme Court cases that a person has no constitutional right to hold contraband. Should we protect someone who is already doing something illegal (i.e., possessing contraband), just because they were stupid enough to get caught doing something else illegal (i.e., speeding)? It's seems reasonable to me that the guy who's speeding assumes the risk, that he'll get caught for any other crimes he commits while speeding. If he were speeding, pulled over by a cop and found to be drunk, there'd be no problem with any arrest and search there.
This logic is kind of flawed. If you rented an apartment to someone, and they put a giant hole in one of the walls, would you not hold them responsible for fixing it merely because he said, "I didn't know that the lease stated that I couldn't put giant holes in walls. I never read it and just signed it because I really wanted the apartment and was going to sign anything you put in front of me to get it. You shouldn't hold me responsible."
Maybe, maybe not, it depends on the wording in the EULA. I think, a person should be expected to abide by terms that an objective bystander would view as reasonable. For example, I think a condition prohibiting the user of the software from making copies of it to redistribute or resell is an acceptable term. Conversely, I think a term requiring the user to hold the manufacturer harmless for any and all damage or data loss that might result from installing the software is arguably unreasonable and something any person would not expect to be agree to when they click the accept button.
There are plenty of alternatives to participating in interscholastic sports, for example independent leagues or club teams.
At any rate why should peer pressure be enough by itself to invalidate a contract? It's not a valid defense if you commit a crime ("I stabbed the guy because my friends said I'd be a pussy if I didn't").
Most schools do not have a "no cut" policy for their more popular sports. When you try out for the team, there is an implicit agreement that if you are not good enough to make the team, you will not be given a spot on the roster. Much like kids that refuse to sign the pledge and do not participate, the kids who get cut will also suffer the same ridicule and be ostracized. Does that mean we should guarantee every kids that wants to participate a spot on the team?
Whether they are or not is moot point, the school has no obligation to allow anyone that wants to participate in them. See the discussion of of tryouts and roster cutting above.
Quit with the ad hominem attacks. Attack my argument, not me. Besides, there's always good old fashioned PE. You don't need to be on the football team to get exercise. Dodgeball anyone?
You're describing what is known as a contract of adhesion. Contract law varies from state to state, and I do not know whether Minnesota generally enforces these kinds of contracts, but if they do not, the basic standard for determining enforceability is the same as your country (i.e., whether the terms in question are unjust or unreasonable).
That said, I do not think a court would find a pledge promising not to drink alcohol unjust or unreasonable. Morality aside, consuming alcohol is illegal for persons under the age of 21 in Minnesota, so the pledge is in fact a promise not to break the law.
This seems perfectly reasonable since teens make such promises all the time. For example, when teenagers get their driver's license (at age 16) they promise not to drink alcohol and drive under penalty of forfeiting their license. The pledge in question is sufficiently analogous to this promise such that it is probably just and reasonable to "force" them to promise not to drink alcohol in exchange for participating in school sponsored sports.
Additionally, it's worth noting that the school is a state government organization, and since the state is the ultimate regulator of contract law, it can set whatever terms on its contracts that it pleases, so long as those terms do not violate the state or federal constitution.
First off, as this other post has pointed out, under Minnesota Law, possession of an alcoholic beverage creates an rebutable presumption of the intent to consume said beverage. The pictures provide evidence that the teens possessed alcoholic beverages, and thus, the police probably have enough to charge the teens if they so choose. It would be the teen's burden to show that the containers contained something other than alcohol.
However, lets get to my bigger point. These photographs (WARNING: GRAPHIC, NSFW) might show that the men in them were victims of degrading torture, or it might show that these men are having a consensual homosexual orgy with and have a fetish for autoerotic asphyxiation . Heck, those photographs might also show the smiling people in military uniforms as would be torturers, or it might show them as a smiling couple on vacation at a Hedonism resort.
The mere fact that the acts conveyed in a photograph may have multiple interpretations does not deter from the fact that there is probably one reasonably likely interpretation that most people would adopt. Sure those Coors cans could all contain apple juice, and that fifth of Absolut could actually just be water; sure those kids could just get off on pretending to drink alcohol but would abhor the thought of actually drinking some until they turned 21, but really what are the odds?
I agree that the police would probably do nothing, but it has more to do with the expediency of not acting (i.e., not pissing off the parents, or letting the parents handle it) rather than lacking any evidence on which to arrest and book the kids.
This isn't mandatory at all. How about not participating in school sanctioned athletics if you find the pledge's requirements to onerous? There are plenty of club teams and non-affiliated leagues for sports in the US.
A student has no guaranteed right to participate on the school's sports teams anyway. EPHS, like most schools in the US, requires students to go through tryouts for certain sports teams, implying that a student is not guaranteed a spot on a team even if he/she willingly and knowingly signs the pledge. The morality of the pledge's goals aside, I fail to see how signing this pledge is anywhere near coercive.
Wrong, they were not coerced into signing that agreement. None of these students was required to participate in interscholastic competitive sports, and participation in such sports were not required as a condition of graduation, but rather completely voluntary. While I doubt any of these students read the pledge they signed (still not a valid excuse), they were in no way forced to sign it if they disagreed with the school's/state's policy governing student athletics.
If they disagreed they could have simply abstained from playing on the school's teams. If they still wanted to play the sport, I'm pretty sure there is a club team or non-affiliated league they could have joined.
Again, that is a mischaracterization, the agreement in no way impinged on their right to an education. They free attend classes, irregardless of having signed the pledge, the pledge was only required as a condition to participate in the school's athletic programs.