Blog Posts by Henry Blodget

A popular stock market guru, Dennis Gartman, made a black and white call earlier this week, telling subscribers to his market newsletter that he was selling his stocks and rushing to the sidelines.

The implication?

You should do the same thing unless you want to get creamed.

So is that what you should do? Jettison all your stocks and rush to the sidelines?

Not unless you have such overwhelming faith in Dennis Gartman's powers of prophecy that you're willing to bet your hard-earned savings on him.

Although Dennis Gartman is a perfectly respectable market pundit, he doesn't know anything that a lot of other market gurus don't know. And some of them, including CNBC's Jim Cramer, economics professor Nouriel Roubini, and Ray Dalio, the manager of a massive hedge fund called Bridgewater, think stocks are a great buy right now.

Mr. Gartman may ultimately be proven right. The stock market may crash. Mr. Gartman also has plenty of company in thinking that.

But the point is that no one knows

Americans have been granted a pleasant six-week respite from the anxiety that our elected representatives will once again screw up the economy that supports most of us.

In late December and early January, you will recall, the two political parties played a big game of chicken to see who could score the most points in the debt-ceiling and tax-cut-expiration fight. And as part of a deal designed to make each team look like heroes for "cutting taxes" that they could easily have just voted not to raise, a problematic little budget agreement called the "sequester" was kicked down the road a couple of months.

Well, now those two months are over.

And at the end of next week, on March 1st, the "sequester" will kick in.

Unless Congress intervenes, the sequester will trigger about $85 million in annual spending cuts across most government agencies, including the military, the Department of Education, and the Department of Justice. These cuts will result in furloughs, loss of overtime, and

For the last several years, America's biggest corporations have focused on surviving the recession, streamlining their operations, and avoiding big risks or mistakes.

The companies have also watched mountains of cash build up on their balance sheets, thanks to their spectacular profitability. Companies traded on the S&P 500 are sitting on roughly $1 trillion in cash.

All this cash, combined with an ongoing environment of slow revenue growth, cheap financing, and a stabilizing economy, has led many market observers to wonder when a new merger and acquisitions boom would finally kick off.

Well, it seems that the answer might be "now."

Last week saw the announcement of two huge deals: The American Airlines-US Airways $11 billion merger and Warren Buffett's purchase of Heinz for roughly $283billion. And these deals following closely on the heels of Dell's announcement that it is taking itself private, as well Liberty Global's purchase of Virgin Media.

Related: US Airways Merges With

Only four months after launching a new laptop with a high-resolution "retina" screen, Apple has chopped $200 off the price.

Apple's 13-inch "Retina" MacBook Pro will now sell for $1,499 instead of the $1,699 original price.

This is a small move, but it's symptomatic of the broader challenges that Apple (AAPL) is facing.

The most likely reason for a price-cut so soon after launch is that the product wasn't selling well at the original price. And with the 13-inch MacBook, this would not be a surprise: Reviewers were underwhelmed with the laptop when it was released, arguing that, at $1,699, it was not a good value. Based on the price cut, it appears that Apple laptop buyers agreed.

The price cut reveals that consumers won't rush to buy the latest greatest Apple product just because Apple made it. The price-value tradeoff has to be reasonable. And in the case of the MacBook Pro, it apparently wasn't.

This problem--the price-value tradeoff--has become an issue for Apple far beyond

David Einhorn, the hedge-fund manager at Greenlight Capital who wants Apple to issue preferred stock as a way of unlocking value for shareholders, was kind enough to do a brief Q&A with me about the article I wrote earlier.

In that article, I described Einhorn's Apple proposal as "just financial engineering" and argued that even he couldn't create something out of nothing.

By issuing preferred stock, I argued, Apple would just depress the value of its common stock- — so that the transaction would not, in aggregate, create much new value for shareholders.

As you can see in the email exchange below, Einhorn disagrees with that conclusion.

Of all the ways that Apple could return some of its massive cash mountain to shareholders, Einhorn believes that his "preferred" idea would be the most effective and efficient. And he offers an example in which 1+1 would, in fact, likely produce a value that is at least modestly greater than 2.

I still think the preferred idea is needlessly complex and

No matter how many times corporate apparatchiks tell employees not to say dumb stuff in email, employees say dumb stuff in email--stuff that often looks horrendous out of context.

So it's no wonder that emails are the first thing investigators go after when they start investigating companies.

And, more often than not, the investigators find emails that look horrendous out of context.

Sometimes, importantly, these emails actually are horrendous. Sometimes the emails actually reveal (and prove) wrongdoing, even when they are evaluated in context. Sometimes employees do, in fact, break the law or violate industry rules, and leave definitive proof of these transgressions in email. And in those cases, email is an extremely valuable tool that allows investors (and society) to discover the truth.

But the trouble with email is that sometimes people who aren't, in fact, breaking rules often vent or joke or react to information in emails--and, in so doing, create a "paper" trail that, later,

Earlier, I wrote about what Dell was likely to do now that it is taking itself private.

I suggested that Michael Dell and his private-equity backers would coin money, in part by paying themselves a huge one-time dividend with the cash sitting on Dell's balance sheet.

I also bemoaned the fact that Michael Dell had to take his company private to coin this money instead of executing his plan as a public company and sharing the loot with his current shareholders.

More broadly, I complained that too few public-company management teams (like Dell's) have the balls to tell short-term public-market investors to take a hike and implement long-term strategic plans.

And that is indeed a bummer.

But it's also the reality.

Most public-company management teams are so cowed by Wall Street's short-term demands that they sacrifice the vision and cojones that enabled them to build big public companies in the first place. And then they just manage their companies from quarter to quarter while avoiding

Google's stock hit an all-time high on Friday, and it's up strong in early trading on Monday.

Meanwhile, Apple stock is down 35% from the high it hit last September.

What gives?

What gives is that the market has grown more concerned about Apple's ability to maintain its strong growth rate and spectacular profit margin, while growing increasingly optimistic that Google's core business and mobile applications have many good years ahead of them.

Also, Apple is suffering in part because it had such an amazing run for the past five years, while Google's stock treaded water.

At the end of 2007, after a four-year rocket ride following its spectacular 2004 IPO, Google's stock took a multi-year breather.

From 2007 to the middle of 2012, as the company's hyper-growth slowed, Google's stock multiple compressed. And many investors forgot about it.

But Google the company kept growing. And Google the cash factory kept coining more and more money. And Google made several aggressive moves into mobile