This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Digital Skeptic: Who Takes Gold in a Year of Bad Ideas?

NEW YORK (TheStreet) -- If I ever get around to writing my magnum opus on the Digital Depression, this year probably won't rate even a full chapter. It wasn't the dumbest or the most brutal.

But it was an Olympic year, so what better time to fire up the national anthems, wave the flags and award the gold, silver and bronze for an Olympic-sized problem: What was big in digital idiocy -- perhaps we should call it digiotica? -- for 2012.

Will the winners please approach the podium.

Bronze medal: Ignoring the Amtrak-ization of the Google Economy.
The big news in 2012 is the Amtrak-ization of the Web. Yes, the Web-addicted still point to jumping revenues at Web companies such as search giant Google (GOOG). The 15 ish-percent bump from Q2 to Q3 this past year is a popular point of digital pride.

But sober observers are finally seeing that nationalized railroad sort of vibe: Operating profits slid by roughly the same percent or so for the same period. And the "down and to the right" profit margin trend was mimicked by Facebook (FB), eBay (EBAY), LinkedIn (LNKD) and others.

Considering that Web stars such as Amazon (AMZN) long ago stopped caring about posting net margin percentages that are awfully tough to tell from zero, how long will it be before all information age companies pull into a similar razor-thin earnings station?

Remember, it was just 100 years ago that our pathetic, subsidized railroad system, Amtrak, was not just one, but a group of the most powerful and profitable private companies ever. Today, nobody is turning off the Internet no matter what. So how far are we really from being forced to adopt some sort of Amtrak/power utility-like socialized model for the Web?

History is not on the information age's side.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,943.81 +28.74 0.17%
S&P 500 1,967.57 +2.89 0.15%
NASDAQ 4,415.49 +19.2860 0.44%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs