Microsoft Chisels Epitaph for Options

Editor's note: This column, which reflects market activity from the day before, originally appeared July 9 on RealMoney.com. To sign up for RealMoney, where you can read Bill Fleckenstein's commentary every day, please click here for a free trial.

Buckle up, folks, we've got lots to cover. To dispense with the uneventful first, the overnight markets were a snooze, except for Japan, which was higher. Of course, the big news of the evening was Microsoft's(MSFT Quote) announcement that it would replace stock options with restricted stock, and treat remaining options as an expense (more about that below).

In any case, after our market opened, we kind of flopped around, bolted higher, then commenced a zigzag process. To zero in on the particulars, Cisco(CSCO Quote) was higher on pontificating by pom-pom king John Chambers that "in the coming two to four months, spending by companies on information technology will recover." (Later in the day, a Cisco spokeswoman said that Chambers' remarks were misconstrued, and that he had said that industrywide spending will start rising about two to four months after IT customers begin to see their own businesses turning up, whenever that is.) ...