A piece in today's New York Times reports on the bleak outlook for the newspaper industry. Last year, brought the second-worst decline in ad revenue in more than 60 years, with only 2001, a recession, coming in worse.

Essentially, newspaper advertising broke its cyclical mold -- booming and fading with the broader economy. There was a substantial decline in 2007 unaccompanied by broader economic woes. Print circulation is down, and according to the Times online revenue can't make up the gap: "... for every dollar advertisers pay to reach a print reader, they pay about 5 cents, on average, to reach an Internet reader. Newspapers need to narrow that gap, but the rise in Internet revenue slowed sharply last year."

The problem for most newspapers is that they are finding themselves without much of a moat on the internet -- Being the major newspaper in a small city is very different from competing with literally everyone else for web traffic. News aggregators such as Google (NASDAQ: GOOG), Yahoo! (NASDAQ: YHOO), and RSS feeds are probably killing newspapers.

Warren Buffett was once a big fan of small newspapers but unfortunately, all the reasons he liked them are no longer true: They don't have monopolies anymore. You can set up My Yahoo! to deliver you local news and there's just no reason to buy a newspaper for national news with the wealth of online resources available.

Newspapers aren't dead yet but they're definitely dying and I can't think of anything that could possibly reverse it.

Graco Inc. (NYSE: GGG), a leading manufacturer and distributor of industrial and commercial liquids (not the baby stroller company), is still struggling to develop a growth strategy that will help the company overcome a slowdown in the commercial painting sector of the U.S. economy. Until both retail and commercial construction return to normal levels, Graco will continue to face slow or no growth in sales and profits in its U.S. market. The stock has gone nowhere recently, opening the year trading at $40.28, and closing on July 13 at $39.68, up .30. It pays a quarterly dividend of $.165 per share, not enough to attract favorable attention.

A quick look at its 1Q 2007 results confirms that Graco has taken a few hits in the past few months, but CEO David Roberts remains optimistic that Graco's numbers will shortly turn favorable as its completes the acquisition and integration of Gusmer and Lubriquip, and opens a new manufacturing facility in its home state of Minnesota. In 1Q 2007, total sales increased 3% to $197.5 million, but net earnings declined, led by a 9% decline, to $120.5 million, in its U.S. market. EPS declined 2% to $.50. This decline is nothing to get alarmed about, except that the next few quarters don't look that good for the construction sector in the U.S., despite CEO Roberts forecast, so Graco will continue to post low numbers.

Graco is concentrating on growth opportunities in both Europe and Asia. European sales increased 25% to just under $50 million, but a big chunk of that gain was due to currency exchange rates, not organic growth. Sales in Asia increased 35% to $27.6 million, but again, organic growth accounted for only a portion of the increase. Overall operating profit decreased slightly, from 28.4% to 26.4% mainly due to higher product development spending and marketing costs for a new line of paint sprayers. Graco repurchased $24 million of its stock during 1Q 2007 and still has cash on hand to pursue selective acquisitions and expand both its market and distribution channels.

MOST NOTEWORTHY: FormFactor, Inc (FORM), Graco Inc (GGG), China Telecom (CHA), Sempra Energy (SRE) and Unica Corp (UNCA) were today's noteworthy downgrades:

• JP Morgan cut FormFactor (NASDAQ: FORM) to Underweight from Neutral citing expected competition from Micronics Japan, which has successfully ramped up production at its new advanced probe card factory.

• CIBC's checks suggest that challenges still remain in Graco's (NYSE: GGG) contractor segment and is likely to impact results, downgrading shares to Sector Performer from Sector Outperformer.

• Deutsche Bank downgraded shares of China Telecom (NYSE: CHA) to Hold from Buy to reflect slower user growth as the company added 77% fewer fixed-line customers in the first five months of 2007.

• Sempra Energy (NYSE: SRE) was cut to Outperform from its Top Pick rating at RBC Capital following the company's JV announcement with the Royal Bank of Scotland (RBSPY).

• Jefferies downgraded shares of Unica (NASDAQ: UNCA) to Hold from Buy after the company reported lower than expected Q3 licenses to reflect too much variance in execution...

OTHER DOWNGRADES:

• Linear Technology (NASDAQ: LLTC) was downgraded to Accumulate from Buy at ThinkEquity.

• Rackable Systems (NASDAQ: RACK) was downgraded to Sector Outperform at RBC Capital.

• Stanford cut Dobson (NASDAQ: DCEL) to Hold from Buy.

• Lehman assumed coverage of Extreme Networks (NASDAQ: EXTR) with an Equal Weight rating, downgrading shares from Overweight.

• Lazard downgraded First Solar (NASDAQ: FSLR) to Hold from Buy.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Yahoo Inc. (NASDAQ; YHOO), which today replaced Terry Semel as chief executive with co-founder Jerry Yang, may be dragged into the battle royale for Dow Jones & Co. (NYSE: DJ).

Billionaire Ron Burkle, who the unions have enlisted to save them from the evil clutches of News Corp (NYSE:NWS) Chief Executive Rupert Murdoch, is trying to convinced the Internet giant to join him in a bid for the owner of the Wall Street Journal, according to Fortune.

Why the unions think the Burkle is a such a good guy is a little baffling. The supermarket mogul won't get many Christmas cards from shareholders since, as a member of Yahoo's compensation committee, he helped Semel get his outrageous $70 million pay package.

Yahoo should tell Burkle to take a hike. The company's whole strategy has been based on the fact that it DOESN'T NEED TO OWN CONTENT. Executives have made this point to me in person. They've made this point to other journalists. They've made this point to Wall Street analysts. Most importantly, though, Yahoo has made this point to content providers who are nervous about the small amount of original content that the company does produce.

Joining the bidding war for Dow Jones makes no sense for Yahoo. The company has plenty of problems of its own, including how to diplomatically shove Semel out of the door. The theory is that he can do less damage as chairman, until he's given the chance to make a graceful exit, while Jerry Yang gets his feet wet as chief executive.

Susan Decker, who gained kudos on Wall Street during her tenure as CFO, would have made a better choice. She has become president and it wouldn't surprise me if she eventually left the company as well.

Yang has a tough road ahead to convince both Internet users and investors enamored of Google Inc. (NASDAQ: GOOG) that Yahoo still is relevant.

Mention Graco and most people start thinking about baby strollers. If you've ever confused Graco Inc. (NYSE: GGG) with the company that manufactures those baby strollers, join the club! I actually developed an interest in the baby stroller company by following Peter Lynch's principle of "investing in what you know." Graco baby strollers are everywhere and they're made of high quality materials, thus prompting my interest.

I thought to myself -- if the troops in the middle east ever come back from their tour of duty, historical statistics show that there should be a boom in new baby births right after a war ends. The population explosion of the last century may not have been possible without the two world wars. Foolishly, I looked up the stroller company but instead, found one of the world's premier manufacturers of fluid-handling equipment and systems.

On today's STOP TRADING segment on CNBC, Jim Cramer reviewed a couple of ideas to make money.

On Graco Inc. (NYSE:GGG), Cramer thinks the CEO is great. He said if it wasn't for The Home Depot, Inc. (NYSE:HD) the stock would be up. The CEO reportedly said the worst drop in housing was behind. Cramer said the Home Depot is its own problem and its own worst enemy. Cramer said he thinks Lowe's Companies, Inc. (NYSE:LOW) will be able to climb from here.

Cramer said Target Corporation (NYSE:TGT) can go higher as well.

He said American Standard Companies Inc. (NYSE:ASD) and Fortune Brands, Inc. (NYSE:FO) have bottomed.

Cramer also said the Big 3 even after meeting with Bush are just a trying situation and Toyota Motor Corporation (ADR) (NYSE:TM) is the play there.

Cramer said to take the profit on Express Scripts, Inc. (NASDAQ:ESRX), so ring the register according to him.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.