You should spend exactly 15 seconds thinking about the MSFT/YHOO drama. Its interesting yes, but it is completely distracting and offers no real opportunity to help you invest wisely or make money in the market. Why? Because your goal should be to find the companies and stories that aren’t on the front page or even in the newspaper, but will be in the future. I learned this valuable lesson from one of the great value investors, Michael Price. See below link:
Ask yourself what is going on around me that might be a big issue to profit from. My guess is that a big underreported story is the below one about water in California.
Snowpack in CA may be a problem for water reserves
There will be ridiculous amount of ink and commentary spilled and shared on the MSFT/YHOO drama of egos. Ignore it. And while everyone else is focusing on this big story of the day try to figure out what is coming down the line that will be just as big if not bigger.
Regarding you affirmation : “Because your goal should be to find the companies and stories that aren’t on the front page or even in the newspaper, but will be in the future.”
I totally agree, however I learned it from Don Coxe, BMO Strategist that monthly publishes “Basic Points”. He use to say that stories that are on page 16 that go to front page are , in most of the cases, money making situation. The inverse could be profitable as well through a short-selling. Mr. Market is too focused on short-term news that are already priced in. Pabrai make the case of investing “waterfalls”, which is another way to take advantage from front page news. He invested in Embraer which price dropped from $ 40.00 to $ 12.00 due to 9/11, the company was well capitalized (no leverage) and had a huge backlog.