Every day there are numerous stories, articles and blogs about how Microsoft Corp. (NASDAQ: MSFT) is in trouble because its search and advertising models cannot compete with Google Inc. (NASDAQ: GOOG). We hear that Microsoft is so far behind, and so inferior, that it might be in a quagmire from which it can't escape. In other words, Microsoft has become stodgy and passe'.

Steve Balmer, the Chairman and chief advocate for Microsoft exclaims constantly that this is not true and the world is blind to the power of Microsoft -- "just you wait and see!" He appears exasperated every time the comparison comes up and the question is posed as to how he will compete with the Google onslaught.

My first two posts on this site last year were about Microsoft and Google. I was thinking about last year and decided to look back and see how the year unfolded for the two companies. Here are the surprising results. Microsoft actually was the better stock investment over the last 12 months, rising about 35% to Google's 26.5% (25% better). It does not appear that Microsoft investors have been suffering all that much!

Furthermore, MSFT is paying a dividend and GOOG is not. I would also argue that Microsoft, while not a bargain right now, is fairly valued and that Google is at least 10% over-valued on fundamentals despite a spectacular earnings report. From my perspective, given the risk factors inherent in the younger Google, it may be even more over-valued. Certainly its stock price would suffer more on an earnings miss.

This just goes to show you that all the noise in the market place is just that -- a lot of noise, because Microsoft is doing just fine. I do not own shares of either stock and have never held any position in either, but if I was to buy one today it would be Microsoft, it is the better value and safer bet after months of market appreciation.

Those of you who are new to BloggingStocks can check out my other stories and read Chasing Value or Serious Money to find more potential opportunities and verify my track record as well.