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Last year, actually 18 months ago now, James Cramer had enough faith in the Rite Aid Corp (NYSE: RAD) to include it in his 2007 picks. At that time the stock was trading for $5.49 per share. It closed yesterday at $1.56 and is trading further down today.

When I say RAD is wrong, wrong, wrong, I mean it literally. There is a store located a few blocks from my office that I shop at perhaps once a month. Yesterday I bought a few things and was amazed at how bad their accounting was.

My primary mission was to acquire some toothpaste, but there are always a few tempting sale items. When I was checking out I discovered that the sports drink for sale at "5 for $5 dollars" was a mistake and the sign in the store display should have been taken down because the offer had expired. Another item I purchased was marked down from $3.99 to $1.99, great deal! . . . but they told me that the sale price was placed on the wrong shelf for that product and what I wanted was not on sale.

I hemmed and hawed when I saw Jennifer Openshaw's piece on MarketWatch a few weeks ago; her opinion was that Starbucks (NASDAQ: SBUX) would recover much of its lost value in these past several months of sluggish sales, rising milk costs and slipping coolness, no matter what the naysayers, say. Her argument: that Starbucks was great because of its atmosphere and general quality standards in coffee. While I certainly agree that Starbucks is still an attractive "third place" and would pick Pike Place brew every time over McDonald's or Dunkin Donuts coffee, I hesitated. Had management already made too many mis-steps? Had hubris got the best of the 'Bucks?

The latest news; that Starbucks management has plans to close 600 stores in the U.S. this year; could be an indication of positive things in the company's stock price. It certainly had traders in after-hours activity eagerly snapping up shares, sending 72 cents, or 4.6%, to $16.34 around 2 a.m. I'm always leery, though, of a huge strategy reversal such as this. In my analysis of Starbucks' financial statements, the company spends about $300,000 to start a new store, and this is largely funded through cash. Management regularly offers old furniture and equipment to its high-ranking employees when upgrading or shutting down a store, so it's unlikely that much of the cost will be recouped. Doug McIntyre noted further that Starbucks will continue to pay more millions in lease costs; the company is known for locking up prime real estate with serious long-term lease agreements. Sure, the loss won't affect the cash balance much, and the charge will be "one-time," so the financial picture will still look rosy in a year when the charge has dropped into "historical financial statements." Investors don't look back.

But by acknowledging that some $180 million in costs, not to mention the hundreds of millions probably spent to train and employ staff at these locations, was a big waste of money, Starbucks management is owning up to a future of slow growth.

It should be no surprise to anyone that despite all the ranting and raving to the contrary Mr. Carl Icahn, billionaire investor, shareholder white knight and corporate raider is heating up things in the Yahoo! Inc (NASDAQ: YHOO) boardroom.

It has been reported that he purchased a sizable chunk of the company in the neighborhood of $25 per share, hoping to make another fortune pushing Yahoo back to the negotiating table with Microsoft Corp. (NASDAQ: MSFT).

This morning AP reported that Jerry Yang, CEO and company are lobbying major shareholders to rally support for their position that Yahoo! should get a higher offer or stand alone as an independent company. It seems to me that they are standing on lose ground given that many large and small shareholders alike have already spoken, and they would have taken the deal.

The market has spoken as well, with Yahoo stock losing over a third of it's value recently and nearing $20 per share this morning Icahn is losing 20% of his investment as things look today. This is turning into the battle of the billionaires.

One small problem the billionaire boys in Redmond are not that hot on the deal any more because, as Gates Leaves Microsoft, he Calls Yahoo Deal Unlikely.

I think this whole saga might make a cute Neil Simon play if they would let him into the meetings to take some notes.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I do not own shares in the stocks mentioned in this story.

A few days ago I posted Chasing Value: Valero -- when is a downgrade an upgrade? and since then I have become even more disturbed with our government and the stock analysts, as well as the companies they represent. Eitan Bernstein, an analyst with Friedman, Billings, Ramsey & Co downgraded his expectations for the major oil refiners Wednesday and lowered his price target for Valero Energy (NYSE: VLO) from $77 to $65.

How can this be? The stock was trading around $40 per share and closed Friday at $39.96. As a shareholder who has watched this stock go down, any signs of optimism have to be welcome I suppose, but what in the world is this guy saying. He is saying he has concerns about the sector, but believes VLO will be 61.5% higher this time next year any way!

This makes no sense. He can't be too concerned, can he? If you believed him you would buy all the VLO shares you could get hold of -- and so would he! Maybe he did? Or maybe he is trying to pump up the stock to help a big client? Or maybe he is clueless and does not know what he is talking about? What might his e-mails reveal?

Anyone can predict anything, and they have a right to be an idiot, but what responsibility does he have to eat his own cooking? VLO started the year near a high that is between Bernstein's old and new projections, and I for one have hopes of it rebounding, but I do not have the level of certainty to broadcast such an exact figure. What is the purpose?

The change in his projections of 15.5% is indicative of the silliness of this analysis. We have seen this before and will see it again ... so buyer beware.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. DISCLOSURE: I currently own shares of VLO.

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It was only yesterday that I posted Serious Money: GM, GE, Gee Wiz!, concerned that Barron's was betting on the wrong horse (which happens all too often -- see Sunday Funnies: Big Brown a sure thing at Belmont) as it pumped up General Motors (NYSE: GM) in a cover story two weeks ago.

GM stock closed yesterday at $12.81 but today traded down to a new 52-week low of $11.21; as of 1:15, it is at $11.51, down nearly 10%.

GM is trading at a 30 year low. "Today's drop came after a Goldman Sachs analyst cut his rating for GM to "Sell" from "Neutral" and his price target to $11 from $16, saying things could still get worse for the North American automotive industry as a whole."

I wonder if he read my post yesterday . . . probably not. I am not a big fan of analysts as a group but this did not take a crystal ball. Barron's should do a follow-up story explaining how their crystal ball got so fogged up.

It's time to start drilling for oil and natural gas offshore on the east and west coasts. We are wasting our time and our money, and risking our future by not doing so. The energy needs of the United States have made oil our number one import and the biggest factor in our imbalance of trade.

It is not just that oil holds us hostage to the rest of the world. This imbalance of trade means we cannot support ourselves and must borrow from others to get by, and I, for one, have a very hard time with that notion. I prefer independence -- remember that? I think it was an important concept in our founding, way back when.

The imbalance in trade is a mortgage against the future of our children and it is getting worse year after year. The money often goes to foreign governments whose interests are not aligned with ours and they hold us politically and economically captive. Nothing is more shameful than President Bush pleading with Saudi Monarchs to pump more oil.

A recent Barron's had a cover story featuring General Motors (NYSE: GM) which I have been pondering for a while. Somehow the story did not get me all that excited despite the boldness of the headline reading "BUY GM."

More attuned to the words that followed -- "GM is a risky bet" -- I wondered why they would not feature something with possibly equal potential and far less risk. If you read the journal cover to cover, you might have taken note of the fact that there were two articles highlighting General Electric (NYSE: GE).

In the first, Michael Santoli extols the virtues of owning GE compared to a 10 year Treasury note which offers security but no upside potential. He mentions the high yield, low P/E, strong businesses and the fact that current CEO Jeffrey Immelt bought shares in the open market for $3.5 million.

Regular readers know that I enjoy Barron's Weekly (subscription required) one of the best business journals around and that it has provoked some of my better investment ideas. However, even Barron's can fall prey to bad or incomplete reporting, (as if there were a difference), as they benefit from market activity and can stretch an idea too far, becoming all too common.

Barron's incomplete and common story was in the June 9, 2008 issue titled "Timing is Everything". What I find common, and thus objectionable, is the fact that they choose to tout Appel Asset Management's like so many brokerage houses do numerous funds (for the fees), ignoring basic tidbits like said fees, and taxes. The Appels seem to do an admirable job for their investors but they do not beat the indices, so who cares?

Their simple strategy is to invest in the two broadly based hot ETF's, counting on momentum lasting more than one quarter, and switch them out each quarter. This they claim takes only an hour of work every three months, how lovely. In the story they state "From 1979 through 2007, Marvin Appel would have (emphasis mine) returned 16% a year, before fees, better than the 15% a year performance of the Russell 2000 Value Index". They also leave out how long the approach has actually been in place.

An interesting post written by Joseph Lazzaro on Tuesday indicated that many economists think that the economies of Brazil, Russia, India and China, known as the BRIC economies, will supplant the United States and European nations in terms of world power and economic strength. While this may be true to a degree, I have a message for those emerging economic powerhouses: they had better be careful.

Dear Brazil, you have resources you can't yet even contemplate. However, you have been whacking through your opportunities at a very rapid pace. You have no idea about what political powers you should align yourself with. Can you reign in your pirates, your poachers, your drug lords? Can you effectively protect even just one of your trees?

Dear Russia, you scare me. The world knows more of your organized crime than it knows of your present government. You move more capital through your black markets than through your own ports. You turn your backs on true enterprise in exchange for quick profit.

Yesterday could have been the end of the NBA season, but the Los Angeles Lakers forced a game six in Boston -- not so much by winning; more by having a "refuse to lose" finish that they could not muster before. I am quite sure David Stern is fine with that outcome. ESPN, and ABC television owned by Walt Disney (NYSE: DIS) must be ecstatic. The NBA officials will earn another paycheck, and the sponsors? They are praying for a game seven for sure!

Yesterday, prior to the game, I posted Sunday Funnies: Lakers/Celtics -- NBA business success, and dedicated much of the word flow to all the clamoring about NBA officiating and reasons why the game had issues. Today is all the about the cash.

While the Super Bowl is the hugest of events, an NBA Finals is a saga with twists and turns, and this one so far has had many. The Lakers face insurmountable odds of winning two games in Boston so they have been as much as counted out already.

Laker star and NBA Most Valuable Player Kobe Bryant has posed the most interesting perspective on the challenge his team faces that I can ever remember. He said, prior to the game, that since he did not go to college he viewed his situation like making the Elite Eight referring to Division I college basketball March Madness. He said, you just have to feel grateful you are there and know that you have to win three games to win the tournament.

Associated Press has made it quite clear that the organization intends to put the hammer down on bloggers who quote that news service. As one who routinely quotes and links to Associated Press content, all I can say is, "Yeah, good luck with that."

At first, AP took a hard-line stance, demanding that one particular blog should remove seven pieces of content which featured quotes from AP articles and stating that bloggers across the internet should curtail the use of AP content. However, when faced with a swift backlash from a cross section of well-known and heavily-read bloggers, the news service took a big step back. The New York Times reported that Jim Kennedy, vice president and strategy director of The A.P., stated in an interview that the agency was "heavy-handed" and that A.P. would "rethink its policies toward bloggers."

The National Basketball Association (NBA) led by commissioner David Stern, Esq. has been a spectacular financial success over the past two decades. Even after Michael Jordan hung up his jersey and people wondered aloud how he could be replaced, the league hardly missed a beat.

Kobe Bryant, LeBron James, Steve Nash, Dwayne Wade, Kevin Garnet, Amare Stoudamire, and this year Chris Paul and Dwight Howard have entered the pantheon of NBA superstars adding plenty of excitement. By the time Jordan retired it was over due.

While the NBA has been making money it has been losing its luster in other regards. The brawls, bad calls, and official Donaghy's integrity fall have only served to force Stern to earn his pay working over time to repair the damage.

The current uproar about the officiating is not the result of criminal activity, or lack of effort or skill, or poor eye sight, or planned manipulation. What it is about is a lack of clarity and consistency in the game. No other legitimate professional sport ignores its own rules as blatantly as the NBA.

The most serious are the definitions of traveling or carrying. The words in the book have not changed they are just ignored. I watched Tim Duncan walk from the top of the key taking three long and obvious strides to the hoop and dunk it without a call. Guys spin to the hoop changing their pivot foot all the time. Sure it makes the play fun but it makes the game a sham at times also. It also feeds the misrepresentation of the players as "unruly".

Microsoft Inc. (NASDAQ: MSFT) was silly for offering Yahoo! ( NASDAQ: YHOO) way too much money to buy the company and finally came to it's senses.

Yahoo! was oh so silly for not accepting over $45 billion and now the stock is down 33%, ironically because the last offer from MSFT was $33 per share. I have no data on the subject, but I have to believe that this is probably one of the richest buyouts of all time to be rejected.

Then comes silly old Carl Icahn thinking he could force Jerry Yang's hand and make him sell out to MSFT at a premium to his average share price reported at $25.00. He has made some shrewd moves over the past 20 years but this does not seem to be one of them today. Instead of making millions on the upside, for now it looks like he will lose as much as he hoped to gain on the downside.

I just came back from an advanced screening of Marvel Entertainments (NYSE: MVL) Incredible Hulk and it surpassed my expectations as did Iron Man before it.

The preview Wednesday night, two days ahead of the premier scheduled for Friday the 13th, is probably too scary for little tykes but it is a superb blend of movie technology magic and the passion of the cast and crew.

It's all in the eyes. Unlike the glib Tony Stark character in Iron Man, played fittingly by Robert Downey Jr., Edward Norton is the emotionally gamma ray charged green powerhouse that only roars, and must communicate his feeling though his eyes. This is the case when the Hulk's temper rages and when he is expressing his affection for Dr. Elizabeth Ross, played by to perfection by Liv Tyler.

For the first time Monday I heard John McCain comparing Barack Obama to Jimmy Carter. I had heard this before in other arenas, but not from McCain. I guess that despite these two presidential candidates pledging to the American people to bring change and resist politics as usual, they are both, as usual as one could get.

Obama is being shaped by the pressures of running for office and to believe otherwise is delusional. I suppose one has to have hope but the effects of the campaign are becoming clear. Obama has been painting McCain as an extension of Bush, which is nonsense, and now in a typical tit-for-tat response, McCain is filling the air with Carter references.

Both McCain and Obama are wrong in their assessments of their opponents and they are becoming commoners to resort to the bottom of the barrel campaign techniques used in every campaign for most of our nation's proud history. Obama gave up the high ground too easily and McCain has decided he can sling mud with the best of them.