Fortune magazine wants to send all the bad Wall Street people straight to jail—for ripping you off! Do you think Fortune knows the meaning of 'cognitive dissonance?'

Bad news is still big. It's just the articles that are getting smaller. 2008 was 80 percent less dumb than 2007, according to Fortune! A year ago, Fortune readers were treated to a full 101 moments of dumbness in an end-of-year comic look-back. This year? Only 21 dumb moments to be found.

Just last month, Fortune reported on how investors are still bullish on green technology. And there's plenty in its pages about the bright future of online media. But Fortune's accountants must not read the magazine! Fortune has laid off two reporters on the cleantech beat, and all but one of its New York- and San Francisco-based online reporters, who wrote primarily for the magazine's website.

So Portfolio went with a Dov Charney cover in the midst of the greatest financial crisis since the Great Depression. Hey, what do you expect them to do—undo stuff that had already been planned? What are they, a daily? No, they're a monthly, and they refuse to get all worked up about anything. They must maintain their office's monk-like atmosphere at all costs. And their fellow business mags agree: with a little creative editing, you can make it look like you're covering this crisis without doing any extra work at all! Portfolio's response to the crisis: meetings.

Is Yahoo cutting 3,000-plus jobs? A source inside the company says plans have been set to slash 3,500 jobs on December 10. And, briefly, Fortune's Techland blog agreed, reporting that Bain & Co. had recommended Yahoo cut 3,000 of its 15,000 employees. The Fortune post has been unpublished, though it still appears in Google News. I've called the writers to ask what happened to the story. Here's the excerpt which ran on Google News:

When Fortune asked Martha Stewart to give a presentation at its "Most Powerful Women Summit" last weekend, the mag probably assumed she'd instruct the group on how to prepare the perfect rhubarb pie. Instead, Martha went all new-agey and decided what everyone really needed was to learn how to do a proper downward dog. (How fitting for these stressful economic times!) The only disappointment: While Martha did get to hang out Warren Buffet at the event, it does not appear she was able to convince him to step on to a yoga mat. [The Martha Blog]

In December, Fortune magazine admitted it had been remiss naming insurance giant AIG one of its "10 Stocks To Buy Now" before a yearlong 18 percent decline. "We... didn't expect [the] mortgage unit to be such an albatross," editors wrote. To correct the error, the magazine had a fresh list of "The Best Stocks For 2008" — including Merrill Lynch. "Smart investors should buy this stock before everyone else comes to their senses," Fortune wrote, calling a recent correction in Merrill stock "an overreaction." Investors who followed this advice are now down 93 61 percent. All the big financial magazines butter their bread with dubious prescriptions for how hobbyist investors can beat market professionals, so Fortune is hardly alone in being humiliated by the ongoing market meltdown. We'll spread the embarrassment around after the jump.

• Keith Kelly of the Post reports that 14 of the 17 staffers at Fortune Small Business are getting the axe. [NYP]

The invite-only Fortune Brainstorm: Tech is taking over the Ritz-Carlton in Half Moon Bay through Wednesday. Dreadfully convenient for Robert Scoble, who lives in town; not for Japanese VC Joi Ito, who's jetting across the Pacific. The maelstrom of people and ideas includes the likes of Amazon.com's Jeff Bezos, the World Bank's Daniel Kaufmann and One Laptop per Child's Nicholas Negroponte. If your thought-leader status was somehow overlooked, fine-tune your leadership skills at tonight's East Bay Innovation Group. Organizational psychologist Peter Newton offers insight into how startups can grow strong and competent leadership. Ready for the next frontier? Klara Nahrstedt, a professor of Computer Science at Marc Andreessen's alma mater, the University of Illinois at Urbana-Champaign, is in town indulging your sci-fi holodeck fantasies as she discusses Cisco's Teleimmersive Environment for Everybody.

Apple COO Timothy Cook is the man most likely to replace co-founder and current CEO Steve Jobs according to Fortune.

This month's Fortune presents two dueling covers—John McCain and Barack Obama both promising to fix the economy. It's cute! John McCain says the greatest threat to our economy is terrorism, obviously. ("Terrorism" means "secret Muslim president.") But McCain, while he doesn't understand anything about economics, has a cunning plan to fix the current crises: allow Barack Obama to win and inherit a situation so dismal that there's next-to-nothing he can do, then allow McCain's party to reap the benefits of total collapse a few generation later. Cunning! [Animal]

An emailer: "15 people are to be let go at Fortune mag; about 8 through buyouts." Also, "[Money executive editor] Craig Matters left to run Fortune.com, the two deputy MEs were promoted to co-ExecEd's (yes, that is a bit bizarre and not so workable) and the photo editor Jane Clark was fired Friday. Mg. Ed. Eric Schurenberg also just lost superstar Jason Zweig and another editor (Cybele Weisser) to the WSJ. Craig was in charge of the Best Places to Live uber-franchise and many writers at the mag have said they'd bolt if Craig left." Folio confirms all this besides the Jane Clark firing. Anyone else have more details?

"Bethany McLean, co-author of a best-selling book about the Enron debacle, is leaving Fortune after a 13-year run to jump to Graydon Carter's Vanity Fair... It marks at least the third time that Condé Nast, which is headed by billionaire chairman S.I. Newhouse, Jr., has come calling on McLean, one of the higher-profile journalists at the Time Inc.-owned business magazine. Portfolio had tried to get her to jump ship a year ago when Condé Nast was launching its business magazine, but Time Inc. editor-in-chief John Huey intervened to help Fortune win that tug of war." [Post]

While taking risks is valuable, it's only those who can successfully commercialize their breakthrough ideas who will succeed, Google cofounder Larry Page told Fortune in a feature interview.

Josh Quittner, former editor of the defunct Business 2.0, has extricated himself from his unhappy stay at Fortune by returning to Time, where he previously worked. Tellingly, Time editor Rick Stengel refers to him as a "writer" for Fortune, though he had the ostensible title of executive editor. Stengel's memo is included below. Quittner's new gig is his old gig, covering consumer technology, which takes him back roughly 13 years in the progress of his career. Funny, because we'd heard that Quittner had held serious talks with Michael Arrington about joining TechCrunch, around the same time he wrote a laudatory column about the tech blogger. All that puffery, and no job in exchange? A shame.

Not that we're merchants of gloom, the latest figures for magazine advertising are dismal. Tallies of the number of pages carrying advertising in the first quarter, an early indicator of publishing woes, are down by double-digit percentages at news weeklies such as Time and business magazines such as Business Week. The only surprise is that Keith Kelly, who published the figures in today's Post, didn't tweak Mort Zuckerman, proprietor of a rival tabloid. Zuckerman's pet news magazine, US News & World Report, fell 37.5%. One perky spot: Martha Stewart's Everyday Food, now the last best hope of the magazine industry, as well as frustrated cookie-bakers.

There is only one story ever written about Amazon.com CEO Jeff Bezos: That he has defied the skeptics, has had the last laugh, and is now looking to the future. Fortune's latest iteration of the formula is no exception. It begins with an obligatory near-death experience — in this case, a not-quite-fatal helicopter ride near Bezos's West Texas spaceport. And then, Christlike, the escape from death, the resurrection, and the glory. The glory: A stock price driven up not by technical innovations like Amazon's Web services, but by expanding profit margins, the result of tightened R&D spending. Wall Street, not Bezos, has the last laugh, but that conclusion doesn't fit the formula.

Wonkette founding editor Ana Marie Cox is a permalancer! She broke the news on Facebook and Twitter, natch. She's not leaving Time, where she's currently the Washington Editor for Time.com, but she's now a contractor instead of a staffer. She'll still blog it up for them at Swampland, as most Gawker Media alums are generally forced to do, but she now has "more freedom to write in other print outlets," according to Time. AMC says the change was her suggestion. Oh, and Gawker founding editor Elizabeth Spiers is now a contributor to Fortune. This news was broken properly, in a newspaper column, and not on an Internet thingy. (Spiers has a column in this week's Fortune about inflation and the price of steak. It's probably good and smart but we didn't understand any of it except the steak bit.)

Ha ha, your medium is dying! Financial-news print outlets seeking relevance have added video to their web sites. But their work is pretty much the opposite of YouTube gold. Brett Erlich, apparently just this guy who loves web videos, makes fun of the work of the Journal, Forbes, and Fortune on this criminally underwatched Current TV segment.

Josh Quittner, the Fortune executive editor who's reportedly plotting his escape from his gilded cage at the magazine, has written a perfunctory profile of TechCrunch blog impresario Michael Arrington. Nothing we haven't read before — including the obligatory paragraph about Arrington's conflicts of interest in writing about startups even as he invests in them. Quittner observes that the practice seems to boost Arrington's reputation in the Valley. One conflict Quittner never mentions: As editor of Business 2.0, where I worked for him, he tried to strike a deal with Arrington to save the magazine by merging it with TechCrunch. The effort failed, landing Quittner at Fortune.