Microsoft-Yahoo: Move Along, Nothing Here

On Friday, there was a lot of heat, if relatively little light, surrounding prospects of some kind of a "possible merger or other matchup" between Yahoo and Microsoft. Much ink was spilled, and in a rather surprising turn of events Henry Blodget, of all people, seemed to have the best analysis.

I left the story alone, partly because I was at a conference away from wifi for most of the day, partly because I didn't have much to say about it, and partly because the whole thing just felt a little bit feverish and silly. The New York Post does break the occasional business story, but nothing as huge as a Microsoft-Yahoo merger. And even the Post didn't seem to place much weight on the story, burying it as it did on page 34.

In the end, the story turns out to have been a non-starter from the beginning. Robert Guth and Kevin Delaney of the WSJ reported on Sunday that yes, there were talks, but that "the merger discussions are no longer active". It's not clear when the talks took place, or how serious they were, but anybody who bought Yahoo on Friday in expectation of a takeover is likely going to be a seller when the markets open on Monday.

The lesson here is one of the oldest: don't let yourself be distracted by intraday noise. People who are glued to the markets all day burn far too many cycles on the kind of stuff that simply doesn't matter for anybody with a time horizon longer than a couple of days. Investors, certainly, shouldn't care about this kind of thing – only traders and the sell-side have any real reason to try to keep on top of such matters.