Best Business Commentary

The end of the binge

Washington is offering perfectly “normal remedies” to our coming “recession, or worse,” says Robert Reich in The New York Times. Too bad “this isn’t a normal downturn.” We’re at the end of a three-decade “spending binge” by consumers, because consumers have “run out of ways” to “live beyond their paychecks.” The coming stimulus is “temporary” assistance, but “the problems most consumers face are permanent.” And they know it. The core problem is that median wages have been flat or declining for 35 years. And the only “lasting” way to get the party restarted is to give the “bottom two-thirds of Americans” a long-needed raise.

Investors are betting against Micro-hoo!

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In “normal times,” Microsoft’s bid for Yahoo! would have been great for Yahoo! stock, says Daniel Gross in Slate. After all, Microsoft is “perhaps the most solvent company ever created,” and in the “normal Kabuki of deals,” its bid would have ignited a “bidding frenzy” that eventually boosted the initial $31-a-share offer. So why is Yahoo! trading at $29.50? “Erect-deal dysfunction.” Betting on a corporate takeover in a credit crunch is a “recipe for disaster.” And after months of “busted deals”—Harman International, Sallie Mae—the usual bidders, private equity firms, are showing they can’t, or won’t, “consummate previously announced hookups.”