PALO ALTO, Calif. (CNN/Money) -
Business-news headlines have become interesting again. Hooray! It's no longer all good (like in the late 1990s) or all bad (the past three years).
There are winners and losers, savvy and stupid, fortunate and unlucky.
Déjà vu particularly seemed to be in the air with news that Jet Blue (JBLU: Research, Estimates), the young darling of the airline industry, would be buying 100 Brazilian medium-range jets for $3 billion. The market didn't like the news Tuesday, when Jet Blue's shares fell about 5 percent. Investors seemed far more comfortable with Jet Blue's plans by Wednesday, however, as the stock made back most of what it lost.
My gut tells me the market's first instinct was the right one. For me, Jet Blue's move provoked memories of a fatal purchase by the proud old Midway Airlines in 1989.
No one much talks about Midway anymore. But it, along with Southwest Airlines (LUV: Research, Estimates), revolutionized the business by flying out of unpopular airports (like Chicago's Midway Airport), where it avoided direct competition from the big carriers. As a result it could charge far less for seats.
Midway's fatal move was buying a bunch of Philadelphia gates from the bankrupt Eastern Airlines. It was crystal clear the day the deal was announced that Midway was abandoning its humble ways by flying out of a major airport against major competition.
Midway eventually went bankrupt too.
Fast forward to Jet Blue today. The Brazil purchase means Jet Blue will be flying two kinds of planes instead of one. The number of aircraft it's buying means it will be in direct competition with many major carriers at once. The majors will be desperate to defend their turf. At least one of them (United) shortly will have a restructured balance sheet.
Mark the calendar. If Jet Blue declines, it began this week.
Gordon Gekko to the white courtesy phone
The market was even more exuberant Wednesday about shares of retailer Circuit City (CC: Research, Estimates), which gained 6 percent in heavy trading. Could it be that ruthless Wall Streeters were excited by the Wall Street Journal's fantastic page-one story about how Circuit City fires its best workers in order to save money?
Let's get this straight. You tell your most successful sales people -- the ones who get the credit for whatever success the company has enjoyed -- that they cost too much and that less experienced trainees can do their job as well.
But what about the customers who have to, say, learn about digital cameras from a sales person who doesn't know the difference between a megapixel and a megaphone.
And Wall Street...loves this. Of course it does.
There are even hard-to-grasp surprises these days, like Oracle's (ORCL: Research, Estimates) hostile bid for Peoplesoft (PSFT: Research, Estimates).
Folks in the industry are shaking their heads and disparaging kooky Larry Ellison. My take? Larry's goofy, but he's no crank.
| Recently by Adam Lashinsky
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He's flat-out admitting that Oracle's software applications for things like financial reporting and human resources aren't as good Peoplesoft's. Ellison says he'll kill Peoplesoft's products.
I doubt that. If he gets them, I bet he sells them to Oracle's customers, who've already demonstrated they like to match Peoplesoft applications with Oracle databases. That's why Ellison wants to buy the company!
And finally, one last sign these are rational times: The Web site Ipo.com has pulled the plug. That site, and others like it, suggested to individuals that IPOs were a game or some kind of meta-event worthy of special attention.
An IPO is exciting. But it's just an opportunity for a company to raise financing. At least that's what it used to be. And now, without its very own Web site to track the phenomenon, it is again.
Adam Lashinsky is a senior writer for Fortune magazine. Send e-mail to Adam at lashinskysbottomline@yahoo.com.
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