To briefly follow up now that Alibaba had its first day of trading and shot up in value:

  YHOO market cap : 41.86bn
  + liabilities : 3.7bn
  = 45.56bn (-0.44bn)

  Cash on hand = 1.1bn
  + Other assets = 15.3bn
  + Cash from Alibaba sale = 8.3bn
  + Value of remaining Alibaba stock = 37.7bn
  + Value of Yahoo Japan stock = 9bn
  = 71.4bn (+14.3bn)

Now we're at 25.84bn of "free" money. Many, many companies are valued at well above their on-hand cash and assets (sometimes tens or hundreds of times higher), so I continue to think that Yahoo is severely undervalued on paper.

If people are so negative about Yahoo that they would rather leave $25bn laying on the ground rather than be associated with them, I think Yahoo has an insurmountable obstacle to future success.