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(Mercury News)   Good news. If you bought Facebook stock on the first day, you've already lost money. OK, so maybe not good news for you   (mercurynews.com ) divider line
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1762 clicks; posted to Business » on 21 May 2012 at 11:08 AM (4 years ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-05-21 01:11:43 PM  

Kar98: SoCalSurfer: The only people I feel bad for are the employees who's shares are vested.

Whose.


There's.
 
2012-05-21 01:12:26 PM  
Invisible hand in action.
 
2012-05-21 01:13:51 PM  
I just don't understand how no one saw this coming. I guess maybe if you're a Gen Y type, you would think this would be a great idea. But the rest of the world lived through all those dot-com IPOs turning into big busts in the late '90s. Why would things be any different now?
 
2012-05-21 01:19:12 PM  
Google's IPO price, $85

Today, $612

Who knows?
 
2012-05-21 01:22:27 PM  

Urine The Money: Google's IPO price, $85

Today, $612

Who knows?



Because their companies are so similar.
 
2012-05-21 01:33:51 PM  

mrtoadswildride: The_Sheriff_Is_A_Niiii: SoCalSurfer: HahahahahahahHahahahahahahHahahahahahahHahahahahahahHahahahahahahHaha h ahahahah

Everyone around me, "it's only going to go up!! You have to get in on this ipo"

Isn't that what they say about EVERY IPO? Of course all the suckers who bought AFTER it came public will lose their ass as the insiders cash out. Over time you may or may not make money on that but most people's time horizons aren't even close to being that long.

No.

Everyone thought this was going to be google 2.0...That this thing was destined for $600. The problem is: "Everyone thought this was going to be google 2.0" (the company might still be a $600/share company...but it's not happening overnight)

The people who made a killing in Google (or apple back when it was trading at $5 per share) were the people who took a leap of faith on company...they saw something that no one else did...


The problem is that at this stage it is not comparable to Google of 2004. Or even Apple. There is no indication that this is a growth stock. User growth is declining, competition is growing, other indicators are bad as well.
In contrast, in 2004 Google had much better growth figures and had a better long term growth position because it was branching out into a number of new services (Google News appeared in 2002 and Gmail was introduced in 2004, a month before filing for the IPO) Facebook has not shown any growth opportunities, they aren't adding new services, their growth is stalling in their core service.

While I don't know the history of Apple, it was always focused on developing products, which at least provides a strong avenue for growth so your investment was betting on one project being a success. It just took one (iPod) to make the company. Facebook is about providing one service there is no reason to think they will introduce anything new to grow through.

Yeah, there are reasons to invest in Facebook, but the $100 billion valuation and $100 P/E are extreme.
 
2012-05-21 01:34:41 PM  

jayhawk88: So the real question here is, what's Facebook going to do to get revenues up? Are we going to start having to answer trivia questions about Doritos or McDonalds before being allowed to post a status update?


Today when I logged in at work I was not automatically directed to my home page (the first time ever this has happened). Instead, it was to an App "approval screen" (the one where you have to allow permission, etc) for some "sponsored app". There wasn't even a "no thanks" button, I had to click on my news feed icon in the upper right corner.

So it begins...
 
2012-05-21 01:35:21 PM  

GameSprocket: RickyWilliams'sBong: And people think AAPL is a bubble?

Hell, APPL's P/E is 13.49. It should still be a "buy".


Right, and on pretty much any objective measure (growth, markets, dividends, debt, etc), Apple is the obvious buy vs FB.
 
2012-05-21 01:50:51 PM  

Fish in a Barrel: KellyX: shiat, give me a million and i'd live forever on interest alone I suspect.

Doubtful. You'd be lucky to get 3% in the best of times, and these are hardly the best of times. And interest is taxed as income, not capital gains. Call it a 25% cut for federal and state taxes combined. So you'd be living off of $22,500, or $1,875 a month. Not unreasonable right now, but that's best case. Even then, inflation will make that untenable pretty quickly, and if when you have an emergency that requires you to dip into the million, your future income will drop, which may begin a vicious cycle.

I'd say FU money doesn't start until around $5 million. That's enough to build capital while still living off the investment gains.


Oh i'm very fugal and prob would continue my job anyhow... I'd need something to do. So I'd just let it build up or some some of the interest buying FB stock *snickers*
 
hej [TotalFark]
2012-05-21 01:51:02 PM  

SoCalSurfer: HahahahahahahHahahahahahahHahahahahahahHahahahahahahHahahahahahahHaha h ahahahah

Everyone around me, "it's only going to go up!! You have to get in on this ipo"


I recall people saying the same thing about real estate prices.
 
2012-05-21 02:01:58 PM  
I'd like to say "HaHa", but my wife said "No schadenfreude, even if you've come to despise Facebook and what it enables".
 
2012-05-21 02:17:08 PM  

meat0918: I'd like to say "HaHa", but my wife said "No schadenfreude, even if you've come to despise Facebook and what it enables".


How much did she buy?
 
2012-05-21 02:29:24 PM  
assets.gearlive.com

> facebook
 
2012-05-21 02:33:28 PM  

Name_Omitted: meat0918: I'd like to say "HaHa", but my wife said "No schadenfreude, even if you've come to despise Facebook and what it enables".

How much did she buy?


None. She hates the stock market, and doesn't trust all those people still saying "but the market always goes up!"
 
2012-05-21 02:54:49 PM  

Optimus Primate: jayhawk88: So the real question here is, what's Facebook going to do to get revenues up? Are we going to start having to answer trivia questions about Doritos or McDonalds before being allowed to post a status update?

Today when I logged in at work I was not automatically directed to my home page (the first time ever this has happened). Instead, it was to an App "approval screen" (the one where you have to allow permission, etc) for some "sponsored app". There wasn't even a "no thanks" button, I had to click on my news feed icon in the upper right corner.

So it begins...


I basically never log into facebook except when my girlfriend makes me, so I am no authority on the habits of facebook users. But if this anecdote is representative of their new strategy, they are in panic mode. This is the kind of thing that will actively drive users away.

I wouldn't be surprised if Zuck pulled out all the stops for the next 6 months to drive up earnings earnings in the short term, got out a good report to inflate the stock, and then cashed out before the user base starts to decline (which I guarantee it will within the next year).
 
2012-05-21 03:06:43 PM  

LedZeppelinRule: Optimus Primate: jayhawk88: So the real question here is, what's Facebook going to do to get revenues up? Are we going to start having to answer trivia questions about Doritos or McDonalds before being allowed to post a status update?

Today when I logged in at work I was not automatically directed to my home page (the first time ever this has happened). Instead, it was to an App "approval screen" (the one where you have to allow permission, etc) for some "sponsored app". There wasn't even a "no thanks" button, I had to click on my news feed icon in the upper right corner.

So it begins...

I basically never log into facebook except when my girlfriend makes me, so I am no authority on the habits of facebook users. But if this anecdote is representative of their new strategy, they are in panic mode. This is the kind of thing that will actively drive users away.

I wouldn't be surprised if Zuck pulled out all the stops for the next 6 months to drive up earnings earnings in the short term, got out a good report to inflate the stock, and then cashed out before the user base starts to decline (which I guarantee it will within the next year).


If that worries you, just look at what's being trialled in New Zealand.

$2 to highlight your post.
 
2012-05-21 03:16:29 PM  

meat0918: None. She hates the stock market, and doesn't trust all those people still saying "but the market always goes up!"


That's good, but a bit like saying you don't trust people who tell you that you don't have to look both ways before crossing a four lane highway.... the fact that some people are so stupid that they lack the basic sense god gifted a turnip doesn't mean that whatever action they're engaged in can't be done sensibly.

If you're that off-put by the market, just dip your toe in by buying some stock in companies you know and use and feel confident are doing the right thing by you, especially those that offer dividends.

Stocks go up, stocks go down. As long as you don't treat it like a casino or think you're going to be the next Warren Buffet it's really not as scary as some people like to make it seem. You're not going to get fabulously wealthy overnight by investing like a reasonable, honest person (as opposed to, say, being a bottom feeding miser working for JPM or Golden Sacks...) but it also greatly reduces the odds your choices will ever put you in the poorhouse.
 
2012-05-21 03:22:32 PM  

Bungles: LedZeppelinRule: Optimus Primate: jayhawk88: So the real question here is, what's Facebook going to do to get revenues up? Are we going to start having to answer trivia questions about Doritos or McDonalds before being allowed to post a status update?

Today when I logged in at work I was not automatically directed to my home page (the first time ever this has happened). Instead, it was to an App "approval screen" (the one where you have to allow permission, etc) for some "sponsored app". There wasn't even a "no thanks" button, I had to click on my news feed icon in the upper right corner.

So it begins...

I basically never log into facebook except when my girlfriend makes me, so I am no authority on the habits of facebook users. But if this anecdote is representative of their new strategy, they are in panic mode. This is the kind of thing that will actively drive users away.

I wouldn't be surprised if Zuck pulled out all the stops for the next 6 months to drive up earnings earnings in the short term, got out a good report to inflate the stock, and then cashed out before the user base starts to decline (which I guarantee it will within the next year).

If that worries you, just look at what's being trialled in New Zealand.

$2 to highlight your post.


I'm not sure "worried" is the right term. Sure as hell seemed desperate to try and "trick" me into accepting an app (I do not use a single FB App or game and intend to keep it that way). It felt very...well...'MySpacey'

Such little tricks come across as very deceptive and unsavory, and they will start pushing people off the platform. As far as "paying 2 dollars to highlight a post" I will NEVER pay Facebook any direct monies. I could care less who reads my posts other than direct family and close friends.

Also, if Facebook was to disappear...I would not weep (even though I use it almost daily)
 
2012-05-21 03:24:53 PM  

Fish in a Barrel: KellyX: shiat, give me a million and i'd live forever on interest alone I suspect.

Doubtful. You'd be lucky to get 3% in the best of times, and these are hardly the best of times. And interest is taxed as income, not capital gains. Call it a 25% cut for federal and state taxes combined. So you'd be living off of $22,500, or $1,875 a month. Not unreasonable right now, but that's best case. Even then, inflation will make that untenable pretty quickly, and if when you have an emergency that requires you to dip into the million, your future income will drop, which may begin a vicious cycle.

I'd say FU money doesn't start until around $5 million. That's enough to build capital while still living off the investment gains.


Lets see. The house is paid off, the RV is paid off, no car note either. Yup, I could live off the interest of $1 Million. And I could still work on a couple of projects a year if I wanted some extra spending money, or if said projects appealed to me.
 
2012-05-21 03:28:13 PM  
This for me is this like gawking at a car wreck. I can't stop clicking on all the Facebook stock fail stories. Been delightful to say the least.
 
2012-05-21 03:29:37 PM  
In 2015, there will a "social network" identifier that combines your phone number, profiles, bank account, email, geo-location, and all other sundry crap that people have. Everyone will have one.


And it won't be Facebook.
 
2012-05-21 03:35:42 PM  
How long before there will be a CraigsList ad for trading Facebook stock for a 6 pack of beer?
 
2012-05-21 03:41:34 PM  

SoCalSurfer: The only people I feel bad for are the employees who's shares are vested.

Imagine working there (assuming they can't sell for 6 months) and just watching your hypothetical riches dwindle before your eyes.


Been there, done that. Thank god I took the option of more money, less stock when I signed up.

My assumption is that the rank and file have options, just like I did at the company I worked for. Upon going public, all those shares they're entitled too (vested) are now priced at the opening bell price: $38. In order to exercise their options, they have to pay the per share price of $38. They won't be able to touch them for x months (ours was six.) If, in six months, the price is above $38, you exercise the options then sell them and make money.

Unfortunately, they could end up like me. At the six month mark, the shares are trading below the strike price. It's then made worse because instead of a bonus, they give you *more* shares at the current price. Which you can't exercise for six months. And the price continues declining.

If, like Zuckerberg or the artist who painted their office, they were given actual shares and not options, then all is good regardless of the price. But, I'm betting the actual working stiffs got options and they are royally screwed.
 
2012-05-21 03:53:57 PM  

PsyLord: How long before there will be a CraigsList ad for trading Facebook stock for a 6 pack of beer?


I have a framed settlement check from worldcom for 7 cents
 
2012-05-21 04:19:09 PM  
xtragrind: It's almost criminal the way the morons touted this IPO. The guy that works at the coffee stand down in the hospital dumped $2500.00 into the IPO and I'm pretty sure this is money that he can't really afford to lose. When I talked to him last week he said he was buying because of all the hipsters running the stories on NPR about how amazing the IPO was going to be... Super nice guy but he just got caught up in the hype.

I think the same folks are now doing stories about how you should wait till it hits $10 - $12. Meanwhile the coffee guy lost his ass.


Name for it in the finance world is dumb money. It's pure profit charging "access and advice" fees and letting people gamble away their investments.

It's been proven over and over that random number generators will give you better investment pics than the likes of people like Jim Cramer. These highly publicized IPO's are just to get brand recognition on stock offerings so that individual buyers wil push stock slightly higher before institutional holders dump it and reap the rewards.

In other words, you;re getting played every which way to Sunday.
 
2012-05-21 04:23:28 PM  

Bungles: In 2015, there will a "social network" identifier that combines your phone number, profiles, bank account, email, geo-location, and all other sundry crap that people have. Everyone will have one.


And it won't be Facebook.


Newsletter?
 
2012-05-21 04:41:41 PM  

Pincy: Bungles: In 2015, there will a "social network" identifier that combines your phone number, profiles, bank account, email, geo-location, and all other sundry crap that people have. Everyone will have one.


And it won't be Facebook.

Newsletter?


I AM FROM THE FUTURE:
 
2012-05-21 05:08:41 PM  

Altitude5280: This for me is this like gawking at a car wreck. I can't stop clicking on all the Facebook stock fail stories. Been delightful to say the least.


Lol I've been the same way all day.
 
2012-05-21 05:20:07 PM  
I will never sell my Fark stock.
 
2012-05-21 05:25:58 PM  
Where's the "Ha Ha" kid?
 
2012-05-21 05:29:57 PM  

TyrantII: It's been proven over and over that random number generators will give you better investment pics than the likes of people like Jim Cramer. T


I used to follow thestreet.com. Cramer had his portfolio posted during the tech boom. When he started getting killed he pulled it from the site. He made money during the bull run when everyone made money. Since then he's made all his money by pretending he was smart instead of lucky by virtue of coming of age on wall street at a time when making money was easy.
 
2012-05-21 06:06:16 PM  
What did it for me was Zuckerberg forcing his board to agree to buy instagram for 1 billion, with absolutely no due dilligence. It appears that just because some nerdy kid can throw together a couple of lines of code does not mean that he can run a huge freaking corporation.

Zuckerberg needs to be removed and surcharged if facebook is to ever rebound.
 
2012-05-21 06:10:30 PM  
1. If you're dumb enough to buy Facebook stock you don't deserve to have money.
2. You're a dumb bastard if you can't see that Wall street is becoming more astute like in the pre-regulation days of the 1920s when banks and financiers would buy some loser stock early, hype the hell out of it, and sell said stock back to the public at a ridiculously inflated price. All of this is well documented, except people apparently don't read nor have an education.
 
2012-05-21 06:58:13 PM  
You know what? I bought a share of Facebook yesterday. I'm okay with my $4 in losses, just so that I can say I own part of Facebook.

I feel bad for people who bought more than one share for the novelty, though.
 
2012-05-21 07:09:54 PM  

halB: What did it for me was Zuckerberg forcing his board to agree to buy instagram for 1 billion, with absolutely no due dilligence. It appears that just because some nerdy kid can throw together a couple of lines of code does not mean that he can run a huge freaking corporation.

Zuckerberg needs to be removed and surcharged if facebook is to ever rebound.


It was very obviously a gift to a friend


It was also very apparent he doesnt give a crap and this is a cash out
 
2012-05-21 07:21:29 PM  

omgwtfbbq!: You know what? I bought a share of Facebook yesterday. I'm okay with my $4 in losses, just so that I can say I own part of Facebook.

I feel bad for people who bought more than one share for the novelty, though.


Where did you buy shares on a Sunday?
 
2012-05-21 07:50:32 PM  
I have a faceook account, but really don't check it anymore.

I think the tipping point for Facebook is coming fast. People have been in the "more friend" and "add groups" phase for some time now and I think the novelty is wearing off. I looked at my HS son's Facebook and he has over 600 "friends".... and he's very much not in a social crowds. I also on my account previously had about 300 "friends" and subscribed to about 10 groups/band pages, etc...

I realized that I really don't have or need 300 friends. Axed all but about 30 of them (by the way there is a handy mozilla script that allows you to do bulk unfriending... the generic Facebook interface only allows you to defined one person at a time. Also cleared out all my profile info.

I think once the novelty of incessant adding friends wears off, people are going to want to pare-down their experience, and will discover Facebook makes this damn hard to do (I can't image how long it would take to remove 500 friends). This is going to make people realize they are being farmed and I think speed up the movement off of Facebook.

Personally I haven't looked at Facebook for over a month... and don't miss it at all.

While there is a lot more they can do to monetize Facebook, everything they do will simply speed the process of people reducing their usage. Its jumped the shark.
 
2012-05-21 08:28:13 PM  
I have some amazing geocities stock that I'd be willing to trade for a Guinness Bar towel. This baby is getting ready to pop!
 
2012-05-21 09:18:12 PM  

Urine The Money: Google's IPO price, $85

Today, $612

Who knows?


Google's P/E = 15
FB's P/E = 57

Yeah, who knows.
 
2012-05-21 10:06:59 PM  

Atomic Spunk: omgwtfbbq!: You know what? I bought a share of Facebook yesterday. I'm okay with my $4 in losses, just so that I can say I own part of Facebook.

I feel bad for people who bought more than one share for the novelty, though.

Where did you buy shares on a Sunday?


thesinglefilez.files.wordpress.com
 
2012-05-21 10:40:33 PM  
pippi longstocking: 1. If you're dumb enough to buy Facebook stock you don't deserve to have money.
2. You're a dumb bastard if you can't see that Wall street is becoming more astute like in the pre-regulation days of the 1920s when banks and financiers would buy some loser stock early, hype the hell out of it, and sell said stock back to the public at a ridiculously inflated price. All of this is well documented, except people apparently don't read nor have an education.


Worse than that. 70% of stocks are now traded electronically on computers.

Remember back in 2009/10 (forgot the year) when one day there was a legitimate crash? They stopped trading, and wall street was scrambling. They called it an error and literally had a do over! They zero'd out all trades that day and said they'd continue looking into the "error". A news dump on a Friday afternoon months later said no error was found and it basically was a legitimate run, and they reversed it. 100% reversed out all the legitimate transactions.

The wrong people lost money that day, and some people that shouldn't have made a killing did from accurately playing the market, so they reversed millions of transactions.

Do over, cause the right people don't lose money.

The market is a joke, and people on wallstreet are playing with fire there too. Shorts, electronic trading accurate to the ms, analyst algorithms, prodding more idiots to put their money in and pump stocks. There's a reason the markets have been more volatile over the past 10 years. Lots of the right people can make money of of volatility .
 
2012-05-21 11:03:41 PM  

TyrantII: Worse than that. 70% of stocks are now traded electronically on computers.

Remember back in 2009/10 (forgot the year) when one day there was a legitimate crash? They stopped trading, and wall street was scrambling. They called it an error and literally had a do over! They zero'd out all trades that day and said they'd continue looking into the "error". A news dump on a Friday afternoon months later said no error was found and it basically was a legitimate run, and they reversed it. 100% reversed out all the legitimate transactions.

The wrong people lost money that day, and some people that shouldn't have made a killing did from accurately playing the market, so they reversed millions of transactions.

Do over, cause the right people don't lose money.

The market is a joke, and people on wallstreet are playing with fire there too. Shorts, electronic trading accurate to the ms, analyst algorithms, prodding more idiots to put their money in and pump stocks. There's a reason the markets have been more volatile over the past 10 years. Lots of the right people can make money of of volatility .


I work in that industry.

Apparently a lot of Olde Tyme traders were overjoyed at the Flash Crash of 2010, hoping all the algo traders would go away. But they didn't.

They they were overjoyed at the BATS disaster (BATS, a stock exchange, shot itself in the foot on the day of its IPO; there was a glitch in their handling of AAPL, so they shut down that particular trade matching engine. Unfortunately, that same trade matching engine handled their own stock, which they listed on their own exchange.)

But market data rates continue to go up and up. Stocks are apparently slowing down a bit, but options are exploding.
 
2012-05-22 09:01:31 AM  

Pumpernickel bread: Urine The Money: Google's IPO price, $85

Today, $612

Who knows?

Google's P/E = 15
FB's P/E = 57

Yeah, who knows.


Even that's too generous. I believe that's the estimated P/E for 12/2012. Current P/E is 109. FB's got plenty more room to fall.
 
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