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Google's CEO searches dire economy

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Every week, there seems to be a new book that extols the magic of Google (NASDAQ: GOOG). There is even a book called What Would Google Do?, which tries to apply Google principles to a range of businesses.

In fact, even with the plunge in the global economy, it seems that Google is impervious to the real world. Right?

Perhaps not. Interestingly enough, there was some negativity from Google's CEO, Eric Schmidt. This is according to a presentation he gave at the Morgan Stanley (NYSE: MS) tech conference.

Schmidt thinks that the economy is "pretty dire" and that the online ad market will get hit. Yes, the mighty Google will not be "immune."

Yikes.

Hey, if Google can't deal with the current situation, who can?

Although, the grim tone of Schmidt should not be a surprise. After all, the company is far from small and really can't hide as many verticals – like travel, real estate, autos, financials and so on – have gotten crunched.

So, what is Google going to do? Apparently, it looks like the firm's M&A efforts are dormant (because valuations appear too frothy). But, at the same time, Google sees huge opportunities in China as well as mobile. And with billions in the bank, the company can certainly make some nice long-term bets right now.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Streetsmart Guide to Short Selling: Techniques the Pros Use to Profit in Any Market. He is also the founder of BizEquity, a free online business valuation tool for small businesses.

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Last updated: November 24, 2009: 11:01 AM

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