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For what seems like years, Yahoo has been trying to figure out a way to sell its huge stake in China Internet giant Alibaba “tax free”–thus avoiding the billions of dollars of capital-gains taxes it will have to pay on the stake.

Now, Yahoo appears to have finally given up on that plan.

Instead, it’s just wants to sell the stake and pay the taxes, report Anupreeta Das and Gina Chon of the Wall Street Journal.

As Yahoo CEO Scott Thompson’s fate hangs in the balance after it was found that the Computer Science degree on his resume didn’t exist, the world will get to see, yet again, whether Yahoo will finally do a deal with Alibaba.

Yahoo owns 40% of Alibaba. The company is talking to Alibaba about selling 15%-25% of Alibaba back to Alibaba, Das and Chon report. At the $32 billion valuation for Alibaba discussed in Yahoo’s most recent attempt to strike a deal, that sale would generate $5-$8 billion in cash, which Yahoo would then have to pay taxes on.

Alibaba, meanwhile, would have to raise a couple of billion of cash to pay for the stake.

The idea that Yahoo would sell its stake in Alibaba to appease short-term shareholders seems crazy to many observers, who think that Alibaba will go on to create one of the largest Internet companies on the planet. Instead of cashing out now, these observers say, Yahoo should just focus on its core business and let the Alibaba stake amass value. Then, if it wants to cash out later, it can.

And that’s a perfectly reasonable view. Holding the Alibaba stake costs Yahoo exactly nothing. The reason Alibaba wants the stake back is that it thinks it will be worth more later.

So one hopes that, at the very least, Yahoo demands an excellent price for the stake, especially if it’s going to have to pay taxes on the gain.

But, meanwhile, the Alibaba talks are a sideshow. The bigger question is whether, come Monday, Yahoo will be looking for its fourth CEO in a year.

SEE ALSO: In 2009 Interview, Yahoo CEO Talks About His (Fictional) Computer Science Degree

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This chart from Bill McBride at Calculated Risk shows one reason why the economy is still sputtering along: Because Americans are still making much less money than they were before the recession.

The chart shows real personal income (adjusted for inflation) minus “transfer payments” as a percent of the total before the crash. Transfer payments are welfare payments, unemployment insurance, and other government subsidies. When transfer payments are included, the income picture looks better, but of course those transfer payments are just more government spending.

The chart also shows how much more devastating the recent recession was than other recessions for the past 50 years (click for larger):

Why is personal income so lousy?

Because employment still hasn’t recovered to pre-recession levels. Here’s a second chart from Calculated Risk showing current employment as a percent of pre-recession employment.

SEE ALSO: IT’S OFFICIAL: Keynes Was Right

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Scientists continue to gather more evidence that sitting around all day can kill you.

And if it doesn’t kill you, it shortens your life.

On average, reports Gretchen Reynolds of the New York Times, every hour of TV you watch cuts 22 minutes off your life (slightly less for women.) Men who don’t watch TV live 1.8 years longer than men who do

And it’s not just TV. Sitting all day at work hurts you, too.

It makes you fat.

It makes you weak.

It makes you more likely to get sick.

How do we know?

More studies.

Specifically, researchers have figured out why some people get fat when they eat too much and other people don’t get fat, even when they eat the same amount:

The people who get fat get fat because they sit around all day. The people who don’t get fat don’t sit around as much.

Importantly, the difference between the fatties and the non-fatties in the study had nothing to do with exercise. None of the folks in the “inactivity” study were allowed to exercise. The folks who didn’t get fat didn’t exercise–they just didn’t spend as much time sitting. Instead, they stood. They walked. They took stairs instead of elevators. They fidgeted. Etc.

Why is sitting so bad for you? Per James Vlahos in the New York Times, here’s what happens when you sit:

Electrical activity in the muscles drops — “the muscles go as silent as those of a dead horse,” [inactivity researcher Marc] Hamilton says — leading to a cascade of harmful metabolic effects. Your calorie-burning rate immediately plunges to about one per minute, a third of what it would be if you got up and walked. Insulin effectiveness drops within a single day, and the risk of developing Type 2 diabetes rises. So does the risk of being obese. The enzymes responsible for breaking down lipids and triglycerides — for “vacuuming up fat out of the bloodstream,” as Hamilton puts it — plunge, which in turn causes the levels of good (HDL) cholesterol to fall.

Another bummer: You can’t counteract the harmful effects of sitting by exercising once in a while. If you exercise a lot but also sit around a lot, you’ll still have a shorter lifespan than people who don’t sit so much.

But here’s the good news:

You don’t have to start running marathons to offset all that sitting. You also don’t have to get a treadmill at the office and sweat all day. You just have to get up every hour or two and walk around for a while. Or, alternatively, you just have to stand instead of sit.

A new study by researchers in Australia shows that walking around a bit every couple of hours or standing all day is vastly more healthy than sitting all day, no matter what else you do.

So get off your ass!

More in the New York Times >

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Charles Duhigg of the New York Times has written another amazing article about Apple, this time focused on the heroic lengths Apple has gone to to avoid paying taxes to governments around the world.

All companies try to minimize taxes, obviously. And tech companies, it turns out, are ideally suited to skirting tax laws–because tech products can be “sold” from anywhere, regardless of where they’re designed or made.

But Apple appears to have been as spectacularly creative and successful in its tax-avoidance business it has been in its gadget business.

Last year, for example, Apple’s global cash tax rate was only 9.8%. It paid $3.3 billion of cash taxes on profits of $34 billion.  This compares to a tax rate of 24% for Walmart, which, according to Duhigg, is about average for a major global corporation.

In the U.S. last year, Apple’s tax-avoidance schemes allowed it to save $2.4 billion in federal taxes alone, according to one study.  The company likely saved millions more by avoiding state and local taxes.

• Apple’s first major move has been to find ways to allocate 70% of its profits outside the U.S., despite the fact that most of its executives and product designers are located here. The U.S. tax code was supposedly designed to tax companies on where most of their value is created, rather than where the products are made or sold, but Apple has found ways around that.
• The cash generated by Apple’s U.S. business is not collected or managed by the company’s headquarters in California. It’s collected and managed by a subsidiary called Braeburn Investments located in Nevada. Why? Because California has a corporate tax rate of 8.84%, while Nevada has no corporate tax rate. Thus, Apple pays no taxes on profits generated by its cash. Braeburn also helps Apple reduce taxes in other states, which have lower rates for companies that manage their finances elsewhere.
• At the same time that Apple is avoiding California taxes by managing its cash in Nevada, it is getting tax credits from California for conducting “research and development” in California. Apple has benefitted from more than $400 million of R&D credits since 1996, Duhigg says.
• Internationally, Apple invented a tax-avoidance scheme known as the “Double Irish With A Dutch Sandwich,” which is now used by hundreds of other companies. This scheme routes royalties and profits generated on U.S. inventions through subsidiaries in Ireland and the Netherlands and then to the Caribbean. On an accounting basis, Ireland “generated” one-third of Apple’s revenue last year. Apple has also assigned some of the ownership of its Ireland operation to a subsidiary with no employees in the Caribbean, and routes the rest of the Irish profits through the Netherlands, which is also basically tax-free.
• Apple makes sure that salespeople located in high-tax countries are actually employed by Apple subsidiaries in low-tax countries. For example, a salesperson located in high-tax Germany might sell Apple products on behalf of an Apple subsidiary located in low-tax Singapore–and the sales in Germany are then taxed at low Singaporean rates.
• Apple has decreed that many global “iTunes” sales legally happen in Luxembourg, because Luxembourg offers tax incentives for companies that process transactions there. This dodges taxes in the U.S., France, Britain, and other countries that would charge much higher rates.
• And so on…

Now, all this, of course, is perfectly legal. And hundreds of other companies take advantage of many of the same sorts of tricks that Apple uses.

And Apple does still pay billions in taxes ($3.3 billion, on profit of $34 billion).

But while Apple is going to heroic lengths to set up subsidiaries in Nevada and the Caribbean, of course, California is going broke.

And so is Cupertino, where Apple is building its amazing new spaceship headquarters.

So, not surprisingly, many in California are angry about how much tax Apple avoids paying in the state. And so, presumably, are some folks in the federal government, Britain, France, Germany, and other countries in which Apple is following the letter of the law, but not the spirit.

And the answer is certainly not for the U.S. or California to suddenly “crack down” on Apple–if that happened, the company would immediately leave the United States altogether, taking the taxes it does pay with it.

The answer–if the goal is to force Apple and other companies to pay higher taxes–is probably for world trade organizations to come together and establish consistent policies across the world. But that’s easier said that done.

So, in the meantime, the usual adage applies: Paying taxes is for the little people.

Read Charles Duhigg’s article here >

SEE ALSO: Apple’s TV Dream Revealed!

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Walmart’s in serious hot water because its executives allegedly paid $24 million in bribes to Mexican government officials to facilitate store openings.

A former Morgan Stanley executive has just pleaded guilty to bribing Chinese officials.

Both cases may run afoul of a once-obscure U.S. law called the Foreign Corrupt Practices Act, which makes it illegal to bribe officials of foreign governments.

According to the New York Times, the law was enacted in the 1970s, after Watergate, but wasn’t used much until recently. Now government prosecutors are alleging criminal violations of it left and right.

So this begs the question…

Why does the U.S. have a law against bribing foreign government officials?

After all, in some countries, like China, giving “gifts” to business partners is just the way business gets done.

So why should giving gifts to Chinese business partners be illegal in the United States?

SEE ALSO: You’ll Feel Differently About George Zimmerman And The Trayvon Martin Shooting After You Read This

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