14 Responses to “Microsoft bids $44.6 billion for Yahoo”

1. 1 Paul Lambert on February 2nd, 2008 5:45 pm

   I’ve been on the both the ‘buy’ side and the ‘bought’ side of these things. In one of those ‘6 degrees’ examples, I was on the buy team that did the due diligence when Mark Cuban sold his first company to CompuServe. He used the $millions he got from us to launch Broadcast.com which he then sold to Yahoo for $1.7 Billion or so. Then I was on the ’selling’ side when we were looking for a buyer for the company in the late 90s, and we ended up hooking up with Worldcom. We know how that turned out (although our shareholders did quite well).

   No matter how much the execs of the two companies say to play nice with each other, the Microsoft guys are going to be conquerers and the Yahoo guys the vanquished. Microsoft people are arrogant enough anyway, and this kind of thing makes them worse.

   My guess is that in three years or less, the Yahoo team will have been pruned and assimilated, and little of the Yahoo culture will be left. Depending on how generous the Yahoo management has been with stock options, they might not care. Just another batch of Yahoo zillionaires like Cuban.

   I wonder what they’ll buy..

2. 2 Jill Miller Zimon on February 2nd, 2008 7:04 pm

   Paul, you really have just done too many different things in your life! Wow. What’s with the wanderlust?

3. 3 Paul Lambert on February 2nd, 2008 7:25 pm

   Wanderlust is exactly it. Always figure there’s got to be something interesting around the next corner. We’ve been to all 50 states and around much of Europe. Rode to the west coast and back on my Harley his year.

   But been married to my high school sweetheart for 34 years (and dated for four years before that), and worked for the same employer (CompuServe) for nearly 30 years before retiring. Even a wanderer has to know when he’s got a good thing going.

   By the way, sorry about the back troubles. Never had anything like what you’re going through, but have lots of empathy. In fact, I think I’ll grab some fermented beverage and self-medicate in a show of support.

   PL

4. 4 Jill Miller Zimon on February 2nd, 2008 7:48 pm

   Thanks, Paul. I remember you mentioning that Harley trip. Sounds as though you and your wife have chosen well, as they say.

   What did you think about CompUSA’s shuttering?

5. 5 Paul Lambert on February 3rd, 2008 9:50 am

   I view our economy as an extension of the natural world. Things are born, things die, and the system favors those who have the traits that make survival after a cataclysm possible. There’s no fair or sad about it, it just is.

   When you fool with nature, unexpected things happen. Nature is so complex and interwoven that it is all but impossible to predict how each organism will react to a change in environment (because the ants and the birds and the bears don’t sit down an strategize what to do next – they just survive or not).

   There’s a town nearby called Croton where a company called Buckeye Eggs built an incredibly massive complex of egg farms – tens of millions of chickens. It didn’t take long for the chicken manure to start fouling streams and making the area nearly unbearable. And it was apparently irresistable to house flies. People would hang up a strip of flypaper in their kitchen and have it completely covered by day’s end.

   So Buckeye Egg imported these little beetles that would eat fly eggs. Then people started waking up with beetles in their beds. Buckeye Egg has been shut down, but the flies and beetles remain.

   Same kind of thing with this economic stimulus package. There was a very good essay in Time a week or so ago that said if we put $150 billion in the hands of consumers, it will just end up in Asia, because that’s where most of our consumer goods come from. I agree.

   If we want to stimulate OUR economy, we have create jobs here, just like happened with the WPA, and later with Reagan’s military buildup. I’m sure all of us would appreciate the money getting spent on fixing all the potholes on the freeways in Ohio – although $150 billion may not be enough.

   I’ve always found it interesting that folks who are economic liberals tend to support the notion of natural evolution, but want to control the economy like a god…

6. 6 Jill Miller Zimon on February 4th, 2008 10:23 am

   Well – wait – economic liberals aren’t pushing the stimulus package that’s currently being pushed by Bush as much as Bush was pushing it, true? So I think you lost me a bit on the last graph.

   But the second to last – I agree 100%. I think the stimulus is completely wrong-headed and frankly, is a great indication of just how it is that the mortgage lending crisis was allowed to happen – it was pushed to happen because of short-term gains that for only a very few will be longterm.

7. 7 Paul Lambert on February 4th, 2008 11:54 am

   That last paragraph was just a clumsy tie back to the first – my belief that economies, like nature, are too complex to be manipulated effectively by governments. Power corrupts, greed corrupts – and unfortunately our government exists at the intersection of those things.

8. 8 Jill Miller Zimon on February 6th, 2008 7:04 pm

   Hmm – well – I do believe in chaos theory so that has something to do with the nature of complex structures or organisms, but I’m not sure I believe that that means gov’ts can’t effectively manipulate an economy.

9. 9 Paul Lambert on February 7th, 2008 1:40 pm

   The trouble is that they usually do it badly, with the direction of the error being overcontrol, not undercontrol.

   Student pilots make this mistake all the time. The airplane starts to roll to the left, but they’re slow in sensing it, and slow to react to it, and consequently yank the stick to the right to bring it back to straight and level quickly. Except they crank too hard and too long, and the airplane goes past level and starts rolling to the right. Being slow to figure that out, when they do, they yank back to the left and start one more cycle, getting more out of control each time.

   A skilled pilot will have learned to sense – even anticipate motion, and make little corrections all the time. They don’t get too far out of whack, and therefore don’t need big control inputs (the same kind of thing happens on ships by the way – I can tell you about a rookie helmsman on my Navy destroyer who made a whole bunch of folks seasick with his overcorrections).

   That’s the way our economy has been run for a lot of years, by Dems and the GOP alike. Everyone wants to grab the wheel and make great big corrections, and they end up being late and overcorrecting. It’s the magnitude of the pendulum swings that kill us…

   I think it works a lot better if the government stays out of the way as much as possible, letting the millions of economic enitities make micro-decisions that gradually cause the economy to evolve, just like happens in nature. That’s not to say government doesn’t have a role: it need to watch out for corruption and perversion. Monopolies aren’t good. Criminal behavior needs to be prosecuted.

10. 10 Jill Miller Zimon on February 8th, 2008 1:06 pm

    Ok- I think you are right in a number of these observations – but also, we choose who will govern – maybe we need to choose better pilots?

11. 11 Paul Lambert on February 8th, 2008 2:06 pm

    It’s like flying a commerical airliner by committee. No control inputs are allowed until after debate, negotiation and voting. They might get a good solution – after the plane crashes.

    Nor am I advocating unilateral control on the part of a dictator.

    I guess that in this strained analogy, I’m an advocate for the automobile – let everyone make their own microdecisions but obey the rules of the road.

12. 12 Jill Miller Zimon on February 8th, 2008 11:10 pm

    Who makes the rules?

13. 13 Paul Lambert on February 8th, 2008 11:19 pm

    Congress in broad strokes, regulators at the detail level. Rules against fraud, against the forming of monopolies, that kind of stuff.

    Just tell me the boundaries, but don’t dictate where I go within those boundaries.

    Protect the least of us from injustice at the hands of the powerful. Otherwise, the government should err on staying out of the game.

14. 14 Jill Miller Zimon on February 9th, 2008 8:38 am

    I seem to recall that you and I had a similar exchange several months back, I think in regard to schools/education. We have a basic difference on this point in governance – I trust a government that we can kick out but that is responsible for keeping things equal down the line more than I trust profit-driven individuals. But in reality – neither is a great choice.

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