Yahoo's fun to talk about, but Dow is what matters

Dupont and Dow Chemical
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Two major bits of news this week showed in stark numbers the direction of the American economy.

First, a major player in the tech realm reversed its year-long course to spin off its share of an e-commerce site. Then two of the nation's oldest companies announced a merger that would create the world's second-largest chemical company.

Yahoo's decision to split off its core business into a new company and maintain its stake in Alibaba generated 80,000 hits on Google News in the past week. At the same time, the merger deal between Dow and DuPont — two companies with nearly 350 years experience between them — had only 44,000.

The companies confirmed the planned deal Friday. The combined company would be valued at $130 billion.

The Yahoo move generated a lot more interest but here's the thing: The merger between chemical companies is a much bigger deal.

These are two giant companies with combined annual sales of over $75 billion and employ more than 100,000. Compare that to Yahoo and Alibaba, which have combined sales less than $20 billion. And Yahoo doesn't even own all of Alibaba: The Silicon Valley search company has a $32 billion stake in the Chinese e-commerce giant, or about 16 percent.

Yahoo had been planning for the past year to spin off its stake in Alibaba into a new company. Instead, the Yahoo board announced Wednesday it will spin off its core search and email business and keep the stock in the original company. CEO Marissa Mayer told CNBC that the original decision was nixed because of "tax uncertainty and the duration of time if might take to get to resolution."

Stock in the two chemical companies jumped around 10 percent overnight on reports of the impending announcement. In early trading Friday, Dow Chemical was down about 4 percent and DuPont was off more than 5 percent.

The reason for the misalignment between media attention and the size of these deals isn't hard to guess: While many of us once owned a Yahoo email address and have heard all about Alibaba's expected growth, a lot of tech-savvy millennials have no idea what Dow or DuPont does.

Consumer-facing tech companies are familiar household names, but companies like Dow and DuPont are arguably even more ubiquitous — they make the plastics that form our water bottles, Styrofoam packaging, the insecticides that go on our crops and the performance materials that go into bulletproof vests.

It may not be the most interesting read, but industrial production is still a big chunk of the U.S. gross domestic product, and megamergers like this one may mean more for our economy than the details of another tech deal.