In the second quarter, IAC swung from a $94.6 million profit last year to a $421.6 million loss this year. Don't blame Jakob Lodwick! His former company, Vimeo, is nowhere near the top of IAC/InterActiveCorp's expense report for the past quarter. The real problem at Barry Diller's Internet empire is Cornerstone Brands , a rollup of catalog companies undermined by weak consumer spending in home and apparel retail. Cornerstone's losses led to a $300 million writedown in goodwill in IAC's second quarter. In addition, the soft real estate market cut revenue for home financing site LendingTree nearly in half.IAC is moving ahead with plans to spin off four of its divisions by the end of August: HSN (which includes Cornerstone), Ticketmaster, Tree.com (which includes LendingTree), and Interval Leisure Group, which operates vacation sites including ResortQuest Hawaii . That leaves IAC with Ask.com, Match.com and Citysearch. What's happening? Simple: Diller and company have learned that bundling a bunch of diverse online businesses together doesn't create the promised "synergy" of the Web 1.0 boom. Better to let each site fend for itself. Since IAC got rid of Expedia in 2005 (Barry Diller's still chairman of the board), the travel site's ups and downs have closely followed the travel market . That's the watercooler version. You can wonk out with the full details .