The 5 Dumbest Things on Wall Street: April 15

5. Cisco Flips Out

Cisco (CSCO) finally faced up to the reality of its shortsighted $590 million bet on the Flip video camera this week.

The decision to shutter Flip was faintly praised by Wall Street, only because burning $590 million on Flip in the first place was such a headsmacker to anyone who has owned, or actually just set eyes on, a cell phone. They've been around for quite a while, and cameras were certainly not a new feature to them when Cisco thought buying Flip was a great idea less than two years ago. Call us crazy, but we'd like to think that someone employed at one of the world's leading tech companies could have connected the ones and zeros on this one.

Cisco CEO John Chambers admitted last week that the company had disappointed its investors, and vowed to execute better after two consecutive quarters of weak outlook.

What's even more surprising is that the Flip was generally well-liked by consumers and was selling. Sales of Flip cameras were up 15% year over year, but, as Chambers noted during the earnings conference call, that wasn't enough. "We were looking more in the 30s in terms of the growth for the Flip architecture," he said.

Cisco, in spending more than half a billion dollars on Flip, massively underestimated the changing nature of the video market. The explosion in high-definition video on smartphones, tablets and in-video calling has clearly overtaken consumers' appetite for devices like the Flip.

Strangely, Cisco has no plans to recoup the money spent on Flip by selling it. "We made an evaluation of the business and made a decision to shut it down," said a Cisco spokeswoman, declining to provide any additional details to TheStreet.

Cisco likely wants to avoid the distractions involved in selling off the Flip unit, focusing instead on getting its house in order. As Chambers said in his memo to employees last week: "We have lost some of the credibility that is foundational to Cisco's success -- and we must earn it back."

Being a bit more tech savvy might be a good place to start.

4. A Budget Battle For Bupkis

The trick to three-card Monte isn't that the hand is quicker than the eye. Fools and their money are parted because the ace they are looking for was never really on the table in the first place.

So it is with the budget wrangling we watched in Washington, a partisan battle that almost shut down the federal government. After a battle that devolved into angst over Planned Parenthood, leadership from both sides of the aisle trumpeted that the agreed upon omnibus spending bill would shave $38.5 billion from government spending.

We've now learned that not all the cards were ever really on the table. The drop in the bucket is even tinier than we thought.

An analysis released on Wednesday by the Congressional Budget Office revealed that the spending bill, approved by the House of Representatives on Thursday, really only cuts about $352 million by Sept. 30. Not only are many of the claimed reductions phased in over time, but emergency spending items -- such as the wars in Iraq and Afghanistan -- will increase and offset reductions.

The opening salvo in battling a $1.4 trillion-plus deficit is to scrounge up meager millions. It is like trying to pay down your mortgage by rolling the quarters stashed in your ashtray and between couch cushions.

Put in perspective, budget cuts and layoffs at MySpace earlier this year were estimated to have trimmed roughly $200 million from its overhead and there is speculation that another $200 million in cuts may lie ahead for the News Corp. ( NWS) owned entity. So, let's get this straight -- a Web site that serves up glittery GIF files of unicorns and emo bands for tweeners may be able to slim down more this year than the behemoth that is federal government?

"The more we learn about the budget deal the worse it looks," likely 2012 Republican presidential candidate Tim Pawlenty, the former governor of Minnesota, said in a statement. "When you consider that the federal deficit in February alone was over $222 billion, to have actual cuts less than the $38 billion originally advertised is just not serious. The fact that billions of dollars advertised as cuts were not scheduled to be spent in any case makes this budget wholly unacceptable."

Pawlenty, of course, places the blame squarely on President Obama and Harry Reid. He conveniently ignores the fact that Republican leadership signed off on the deal, even though much of its rank-and-file seemed pretty eager to force a government shutdown if deficit hawks weren't satisfied. As they say, it takes two to tango. Hypocrisy knows no party affiliation.

3. GE, AP Get Punked

General Electric ( GE) was the victim of a fake press release pulled together by anticorporate prankster the Yes Men that said GE would "repay its entire $3.2 billion tax refund to the U.S. Treasury on April 18."

"It is a hoax," GE spokeswoman Anne Eisele told TheStreet..

General Electric has faced intense criticism over its low tax bill since The New York Times recently published a front page article saying the company will pay no federal taxes despite earning more than $14 billion in profits in 2010. The Times story also stated that GE "claimed a tax benefit of $3.2 billion."

The press release was so well-crafted that it initially fooled The Associated Press, which published a story online that Eisele said was based on it.

The erroneous AP story also stated that GE "plans to phase out tax havens over 5 years and said it will create one job in the US for each new job it creates overseas."

GE has intensely contested any attempts in the press to characterize the tax benefit as a refund. The debate is difficult to pin down, though it has highlighted two facts: first, that GE is among the most clever companies in the U.S. when it comes to minimizing its taxes, and second, that the corporate tax code is so complex it is extremely difficult to reach any firm conclusions about how much a giant company like GE actually pays.

2. Jumbo Jets Put the Squeeze on Airports

What? The world's largest commercial airliner clipped a much smaller plane on the tarmac at Kennedy International Airport on Monday night, tossing it like it had been a toy car in a child's hands. Who could have seen that coming?

Regardless of whether the pilots or the air traffic controllers are found to be at fault, one apparent certainty is that anyone could have seen this coming. That is, unless you're in the cockpit of the world's largest plane, we guess. The Airbus A380 has a wingspan of 262 feet; JFK's taxiway -- the industry standard -- is 75 feet. A little basic math, throw in a couple other dozen planes of various sizes in the vicinity, and yikes.

We're not going to argue for restrictions on plane size here, but this near catastrophe makes clear that technology and engineering are allowing planes to outgrow the environments in which they were designed to operate.

Maybe our airports can handle these jumbo jets just fine and air traffic controllers just need to do a better job. Clearly going through the political nightmare of getting airports expanded to handle the realities of the modern age is too much work.

Adding further stress to the system is definitely the better bet. It's not as if the air traffic control system isn't completely modernized, right? Oh, and there haven't been reports of air traffic controllers falling asleep in the tower in Washington, D.C., Seattle, Nevada and Tennessee over the past several weeks. It's not so bad that the head of air traffic control in the U.S. resigned on Thursday, is it?

Despite knowingly putting more stress on the outdated traffic system and apparently sleepy controllers, airports are falling over themselves to get FAA waivers that will allow them to welcome the A380 and the soon to be introduced Boeing ( BA) jumbo 747 to their runways.

Our advice to future flyers -- make sure you're on the biggest plane possible.

1. Clear Channel Takes 'Dead' Aim on Target Audience

It looks like somebody at Clear Channel Communications ( CCO) needs some brainnnsss.

The company recently came under fire for posting a giant advertisement for the zombie-themed television program "The Walking Dead" on the outside wall of a funeral parlor in the town of Consett in England.

Oh, the irony.

"The Walking Dead" is about a small group of survivors in a zombie apocalypse. It airs on AMC, which is owned by Cablevision's ( CVC) Rainbow Media, in the U.S., and on News Corp.'s FX channel in the U.K.

Somehow, no one at Clear Channel realized that posting a giant ad for a show about zombies on a funeral parlor might be a bad idea.

Apparently the company even promised the funeral parlor that the featured advert wouldn't be insensitive in any way.

"It is disappointing that we were not consulted as this advert could cause unnecessary distress," the U.K.'s Daily Mail quoted a spokesman for Co-operative Funeralcare as saying. "When the billboard site was erected, we were assured that no insensitive adverts would be featured."

One nearby resident told the Daily Mail that while some people might find the irony in the ad's placement amusing, many could be easily offended.

"There must be somewhere else they could put it that would have shown a degree of insight and sensitivity." Susan Jones from the nearby Willow Burn Hospice was quoted as saying. "Emotions can be pretty raw when people are recently bereaved."

Clear Channel put out a statement on the mistake, apologizing for its inappropriate placement.

"Clear Channel apologizes for any offense caused by the unfortunate juxtaposition of this advertisement, which was certainly not intended," a company spokesman said. "We arranged to have it removed right away and it has since come down."

In light of all this dumbness, we now ask you: Which is this week's dumbest of the dumb stories? Take the poll below to see what TheStreet has to say.

Which is this week's dumbest of the dumb stories?

Cisco Flips Out
A Budget Battle For Bupkis
GE, AP Get Punked
Jumbo Jets Put the Squeeze on Airports
Clear Channel Takes 'Dead' Aim on Target Audience

This article was written by a staff member of TheStreet.

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