The Sovereign Investor

About the Author The Sovereign Investor

Since 1998, The Sovereign Society has been at the vanguard of the pursuit for personal liberty and free markets. We enthusiastically support the enduring pursuit of freedom and prosperity, and, to that end, we believe in empowering individuals to make educated investment choices. Through the years, we have assembled a talented and deeply experienced team of analysts, editors and researchers who understand that the best investment and wealth-protection opportunities in any market are often hidden. And our approach has led to a great degree of success. Our independent, uncompromised research has predicted some of the biggest financial catastrophes in recent memory. We were one of the very first financial research firms to warn investors about the dangers in the derivatives market and the threat they posed to the global financial system. We also alerted our readers about the dollars crisis of 2004-2005, the meltdown in the private-equity markets in 2007, the collapse of Lehman Brothers in 2008, and we’ve been sounding the alarm bells about the European debt crisis since early 2010, long before the mainstream media started paying attention. In an age when our personal and economic freedoms are being curtailed like never before, our work has never been more important, and our voice never more indispensable. That’s why we remain steadfast in our mission of scouring the globe for investment opportunities that can only be unearthed by our exhaustive, “boots-on-the-ground” approach. With a daunting economic era ahead of us, our purpose is providing our subscribers with the unvarnished truth in an industry filled with artifice and obfuscation. We realize that a world of investment opportunity exists in stocks, commodities, currencies and asset protection that are often overlooked. Our mission is to bring them to you each day. Interested in joining? Sign up for The Sovereign Investor Daily Daily today! (It’s FREE!) Visit http://thesovereigninvestor.com/

LinkedIn Corp (LNKD) is Microsoft Corporation’s (MSFT) Second Chance

MSFT+LNKD

Five years ago, Microsoft Corporation (NASDAQ:MSFT) was the laughingstock of the computer world. Apple’s iPhone, iPad and Mac computers were selling like hotcakes. The latest version of its Windows software system was so awful no one would buy it.

Microsoft’s Bing search engine — which it had invested billions in — was struggling against Google.

Despite generating billions of dollars in cash flow every quarter and billions more in the bank, people were openly questioning if Microsoft had a future. Clients would ask me at meetings if they should sell their Microsoft stock at prices that were crazy low.

But then, Microsoft accepted the problem. The PC boom era that had made Microsoft its billions was over. It was time for a new direction.

Microsoft founder Bill Gates got involved and began to make people take responsibility for the knuckleheaded decisions of the previous 10 years.

In August 2013, Microsoft realized that it needed new leadership. CEO Steve Ballmer stepped down, and shares of Microsoft soared nearly 10% on the news … a good sign.

And from there, Microsoft realized its next leader would need to make changes, have a new vision and not just come in to fix the problems created during Ballmer’s tenure.

Satya Nadella was named the new CEO in February 2014, and he brought with him a new vision for the company.

LinkedIn Corp: A Second Life for Microsoft

Nadella has been great for Microsoft’s stock. Since he was appointed, the shares have rallied 65% and haven’t looked back.

Recently, Nadella made the decision to buy LinkedIn Corp (NYSE:LNKD), the professional networking site with 433 million users for $26.2 billion. That’s the biggest deal ever by Microsoft, and this is an organization that has done 196 deals in its lifetime — including lots of disastrous ones such as buying Nokia in 2007 for $7.2 billion.

One thing that I like to look at when I hear about a big acquisition is the market’s reaction. My experience is that the market’s reaction gives you a heads-up if the acquisition is going to be a good one. In this case, Microsoft stock has jumped 13% since the announcement.

That’s one check in Microsoft and Nadella’s favor.

If you’re a recruiter today, the first thing you do is check a person’s LinkedIn profile. Same when you do business with a person for the first time.

Not only that, LinkedIn has the information on how you connect to your network and how they connect to you.

And for me, this is the real reason Microsoft bought LinkedIn.

LinkedIn possesses an incredible amount of data regarding professional networks that it has been collecting since it began in 2002. That data can be used to generate incredibly valuable information, which can be incredibly useful to businesses. It can help pinpoint business trends, buying habits and potential buyers of products.

Nadella is remaking Microsoft for the post-PC era of computing, and the key to it is data and information. The more data you have, the better information you’re going to get out of it through the use of algorithms and pattern searching.

Nadella’s buy of LinkedIn marked the moment it became 100% clear that Microsoft was on the path to its second life and accepting that the PC era is over.

The New Era of Computing

In the next decade, Microsoft, through LinkedIn and more acquisitions, is going to become a company that benefits from this new data/information era of computing.
Some people believe that Microsoft overpaid for LinkedIn, but they are dead wrong.

These are the same folks who told you that Facebook overpaid when it bought Instagram for $1 billion. Or when Facebook bought WhatsApp for $19 billion.

Today, both those buys are seen as genius moves. And I believe that’ll be the same for Microsoft and LinkedIn in two to three years.

This new era of data/information is the key factor in the Internet of Things mega trend that I’ve written to you about before. And Microsoft’s purchase of LinkedIn is a powerful signal of how critical it is to find a way to participate in it.

Recommended article: Microsoft and LinkedIn – Same Song, Different Key