As reported by the Wall Street Journal, Microsoft has retracted its offer for Yahoo in a surprise change of events. It was widely suspected before that they would be “going hostile” with their original $31/share bid for Yahoo (NYSE: YHOO), and after some negotiations this weekend… Microsoft CEO Steve Ballmer decided to walk.

I had talked about the deal way back on March 9th in a post about the possible takeover. But I guess things weren’t meant to be, I see this as a win-win-win situation as Microsoft doesn’t throw away money, Yahoo doesn’t get destroyed form the inside out, and MSFT shareholders keep their sanity.

From the Wall Street Journal:
“Microsoft Saturday released a letter from Chief Executive Steve Ballmer to Yahoo CEO Jerry Yang saying that Microsoft had said it was willing to raise its offer to $33 a share for Yahoo, but Yahoo demanded at least $4 per share more.“

So where does Yahoo get off demanding so much money, eh? These guys are the laughing stock of the financial world now because they are demanding an unprecedented amount of money… YHOO stock isn’t worth $20…. let alone almost twice that! The drivers for growth in this company are all gone stale. Google, and heck, even Microsoft are tearing them apart on the internet, and there’s really nothing beyond that for Yahoo.

What was most intriguing was that Ballmer actually upped the bid to Yahoo’s CEO Jerry Yang to $33 per share, which was really not anticipated. A lot of people, myself included, see Ballmer as the kind of guy who will make his demand and never back down… kind of a ruthless conqueror of sorts. The fact that he was able to bend and raise the bid should have been enough for Yahoo to accept. I feel like they are dooming themselves and will never get their stock back to that much value.

Wall Street analysts have estimated that shares of Yahoo would fall to $20-$25 if Microsoft walked… I am thinking they are spot on. I’m not so sure what Yahoo is anticipating as far as movements go in order to reposition themselves as market leaders… but you hear names like Google and Time Warner thrown around quite a lot. We’ll have to see what happens.

Maybe if Microsoft acquired Yahoo, bloggers would have seen some insanely cheap advertising deals in a competition scramble… but hey, I see this as a win. This Microsoft empire shouldn’t be getting that much bigger any time soon, and I don’t think anybody wants them having that added pricing power.

-Jimvesting

Another month, another fantastic growth in traffic and readers! Jimvesting Dot Com has been fully established as a reliable business blog at this point, and I have enjoyed a great deal of success over the past two months. Once again, we saw our RSS subscribers double in numbers… and expect this trend to only increase as we progress through the month of May.

After a fantastic March, we followed things up with a killer April that saw about 80 new subscribers coming from all around. It seems that the Net Fool’s Outrageous Blog Contest is proving to be successful, and there have been a decent amount of blog posts on the contest already to help spread the word. Before I get into my plans for the blog’s future, let’s get right at the relevant statistics for the month of April!

March Results

• RSS Subscriber Count: 76 Readers
• Average Unique Visitors: 159
• Average Returning Visitors: 25
• Average Page Loads: 305
• Alexa.com Ranking: 300,597
• Google PageRank: 0

April Results

• RSS Subscriber Count: 153 Readers (101.32%+)
• Average Unique Visitors: 179 (12.58%+)
• Average Returning Visitors:32 (28.00%+)
• Average Page Loads:302 (-0.98%)
• Alexa.com Ranking: 250,089 (20.20%+)
• Google PageRank: 4?

Monthly Review and Growth Strategy
As you can see by the numbers, most of our growth this month came in the form of RSS Subscribers, which we more than doubled (101%+ growth), and finally passed that ever-elusive 100 subscribers mark. Right now, with around 150 subscribers, the Net Fool dot com has begun to be established as one of the more popular ‘make money online’ blogs, and I hope to pass more of the competition with new initiatives this month.

As far as traffic goes, we saw steady increases across the board. Sure, there was a slight decline in page loads… but I feel that the organic growth was great. Last month, the numbers seemed a bit inflated because I was visiting the site myself a lot more to do work on the design. So essentially, we grew a lot more than even the numbers suggest…. the Net Fool dot com is well on its way to success in 2008 and beyond.

We’ve come to see more and more growth from popular search engine placement, with organic search engine traffic comprising 28.8% of the traffic here. Basically, we have been hitting on some great terms in Google and Yahoo such as “best stock investments for 2008″ and “best gold stocks” to name a few. Traffic sources, geographically speaking, continue to trend toward the United States…. however there has been an increasing amount of visitors from Canada, Australia, India and England.

The biggest surprise this month has been PageRank. Apparently, Google has given the Net Fool dot com a PageRank of 4 in the latest update. I am going to blog about this if it holds, because all of the other popular ‘make money online’ blogs have been given a 3…. a 4 would be a rediculous advantage given our short time on the blogosphere. I’m going to reserve judgement on this for now, but if it holds, you will hear about it.

Revenue Breakdown
In April, I put out just one sponsored post, with a few more in the works. In addition, I have sold 3 ad spots for $15/month each. Other than this, SWATcash has continued to provide steady income with just over $30 coming from my referrals. I have a major web design project in the works that will bring in around $200 total, which I plan to invest fully back into the Net Fool. Expenses this month have been about $10 in Project Wonderful advertising, and that’s pretty much it. I don’t like to spend so much on advertising, but am going to move into a few sponsored reviews from some bigger blogs to increase growth… you will definitely hear more about those when the orders are placed.

May 2008 Outlook
This month, I am going to move into some advertising as the Net Fool’s Outrageous Blog Contest shifts into full gear. I feel like this contest can be a great opportunity to tack on an extra 100 RSS subscribers for the month if things play out as planned. 150 subscribers is nothing to scoff at, but I hope to push over 250 by the end of the month. We hit on most of our major targets this April, but hopefully we can surpass expectations for next month.

Since I am curerntly in exams, there is going to be a small amount of lag time in posting… but I am still going to attempt to post daily with some sponsored posts filling the gaps in time. Stay tuned for updates and more opportunities to get rich.

Stay bullish on the net!
-Jimvesting

This is a guest post by Robert from Flimjo.com – a blog containing some great ideas about money, and how to make more of it!. You don’t have to be employed on salary forever, get off the paycheck!

Many people think that investing in mutual funds is the way to go and the best method for getting rich. I think mutual funds are horrible investments. Here are 8 reasons why you should not invest in mutual funds.

1. Mutual funds don’t beat the market.
72% of actively-managed large-cap mutual funds failed to beat the stock market over the past five years. Trying to beat the market is difficult, and you’re better off putting your money in an index fund. An index fund attempts to mirror a particular index (such as the S&P 500 index). It mirrors that index as closely as it can by buying each of that index’s stocks in amounts equal to the proportions within the index itself. For example, a fund that tracks the S&P 500 index buys each of the 500 stocks in that index in amounts proportional to the S&P 500 index. Thus, because an index fund matches the stock market (instead of trying to exceed it), it performs better than the average mutual fund that attempts (and often fails) to beat the market.

2. Mutual funds have high expenses.
The stocks in a particular index are not a mystery. They are a known quantity. A company that runs an index fund does not need to pay analysts to pick the stocks to be held in the fund. This process results in a lower expense ratio for index funds. Thus, if a mutual fund and an index fund both post a 10% return for the next year, once you deduct The expense ratio for the average large cap actively-managed mutual fund is 1.3% to 1.4% (and can be as high as 2.5%). By contrast, the expense ratio of an index fund can be as low as 0.15% for large company indexes. Index funds have smaller expenses than mutual funds because it costs less to run an index fund. expenses (1.3% for the mutual fund and 0.15% for the index fund), you are left with an after-expense return of 8.7% for the mutual fund and 9.85% for the index fund. Over a period of time (5 years, 10 years), that difference translates into thousands of dollars in savings for the investor.

3. Mutual funds have high turnover.
Turnover is a fund’s selling and buying of stocks. When you sell stocks, you have to pay a tax on capital gains. This constant buying and selling produces a tax bill that someone has to pay. Mutual funds don’t write off this cost. Instead, they pass it off to you, the investor. There is no escaping Uncle Sam. Contrast this problem with index funds, which have lower turnover. Because the stocks in a particular index are known, they are easy to identify. An index fund does not need to buy and sell different stocks constantly; rather, it holds its stocks for a longer period of time, which results in lower turnover costs.

4. The longer you invest, the richer they get.
According to a popular study by John Bogle (of The Vanguard Group), over a 15- or 16-year period, an investor gets to keep only 47% of a cumulative return from an average actively-managed mutual fund, but he or she gets to keep 87% of the returns in an index fund. This is due to the higher fees associated with a mutual fund. So, if you invest $10,000 in an index fund, that money would grow to $90,000 over that period of time. In an average mutual fund, however, that figure would only be $49,000. That is a 40% disadvantage by investing in a mutual fund. In dollars, that’s $41,000 you lose by putting your money in a mutual fund. Why do you think these financial institutions tell you to invest for the “long term”? It means more money in their pocket, not yours.

5. Mutual funds put all the risk on the investor.
If a mutual fund makes money, both you and the mutual fund company make money. But if a mutual fund loses money, you lose money and the mutual fund company still makes money. What?? That’s not fair!! Remember: the mutual fund company takes a bite out of your returns with that 1.3% expense ratio. But it takes that bite whether you make money or lose money. Think about that. The mutual fund company puts up 0% of the money to invest and assumes 0% of the risk. You put up 100% of the money and assume 100% of the risk. The mutual fund company makes a guaranteed return (from the fees it charges). You, the investor, not only are not guaranteed a return, but you can lose a lot of money. And you have to pay the mutual fund company for those losses. (Remember also that, even if you do make a return, over time the mutual fund company takes about half of that money from you.)

6. Mutual Funds are unpredictable.
The holdings of a mutual fund do not track the stock market exactly. If the market goes up, you might make a lot of money, or you might not. If the market goes down (the way it is now), you might lose a little bit of money . . . or you might lose A LOT. Because a mutual fund’s benchmark isn’t a particular market index, its performance can be rather unpredictable. Index funds, on the other hand, are more predictable because they TRACK the market. Thus, if the market goes up or down, you know where your money is going and how much you might make or lose. This transparency gives you more peace of mind instead of holding your breath with a mutual fund.

7. Mutual Funds are sales items.
Why don’t all these money and financial magazines tell you about index funds? Why don’t the covers of these magazines read “Index Funds: The Most Obvious And Rational Investment!” It’s simple. That’s a boring heading. Who would want to buy something that isn’t exciting or that doesn’t tickle one’s imagination of immense riches? A magazine with that headline won’t sell as many copies as a magazine that boasts “Our 100 Best Mutual Funds For 2008!” Remember: a magazine company is in the business of selling . . . magazines. It can’t put a boring headline about index funds on its front cover, even if that headline is true. They need to put something on the cover that will attract buyers. Not surprisingly, a list of mutual funds that analysts predict will skyrocket will sell loads of magazines.

8. Warren Buffett does not recommend mutual funds.
If the above seven reasons for not investing in mutual funds don’t convince you, then why not listen to the wisdom of the richest investor in the world? In several annual letters to the shareholders of Berkshire Hathaway, Warren Buffett has commented on the value of index funds. Here are a few quotes from those letters:

1997 Letter: “Most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees. Those following this path are sure to beat the net results (after fees and expenses) delivered by the great majority of investment professionals.”
2004 Letter: “American business has delivered terrific results. It should therefore have been easy for investors to earn juicy returns: All they had to do was piggyback corporate America in a diversified, low-expense way. An index fund that they never touched would have done the job. Instead many investors have had experiences ranging from mediocre to disastrous.”

Bottom Line: If you want to make money, you need to copy what rich people do. So if Buffett doesn’t like mutual funds, why would you? So, if not mutual funds, what should passive investors invest in? The answer by now is clear. Invest in index funds. Index funds have lower fees, and you keep more of your returns in the long term. They are also more predictable, and they give you peace of mind.

-Jimvesting