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View Full Version : The most disastrous start to trading of any major flotation in the last decade.


Tableview
30th May 2012, 21:50
Facebook crashes below $30 in 'worst IPO in a decade' - Telegraph (http://www.telegraph.co.uk/technology/facebook/9298560/Facebook-crashes-below-30-in-worst-IPO-in-a-decade.html)

So, the markets have realised what a pointless, time-wasting and pernicious pile of junk Facebook is! My faith is restored.

And then this ........

Facebook founder Mark Zuckerberg unable to withdraw cash on Italy honeymoon - Telegraph (http://www.telegraph.co.uk/technology/mark-zuckerberg/9300133/Facebook-founder-Mark-Zuckerberg-unable-to-withdraw-cash-on-Italy-honeymoon.html)

con-pilot
30th May 2012, 22:00
Well I am shocked, no I'm appalled.

This sort of thing only happens when I buy an IPO stock. I didn't buy any F acebook stock, so I'm mystified about what happened. :p

Lonewolf_50
30th May 2012, 23:07
:eek: con, you read my mind. The world is becoming a very strange place ...

gingernut
30th May 2012, 23:09
I think that.....oop's sorry, I've got a notification:p

the kid's seem to understand it, must say, it's great for contacting Auntie Bettie in Arizona, and looking at Kelly (from reception), holiday photo's. I thought her bikini was a size too small.

Lyman
30th May 2012, 23:14
It is comforting to see some sanity return. The Facebook Capitalisation was refreshing, especially to see Morgan get snagged with pants down... I never understood the mob mentality in NY until I signed on with a casino corp. Greed makes everyone crazy for miles. I have never believed Facebook clients were solid enough to gel the model to attract ads, let alone investors.

The more it tanks, the more effective the catharsis. Sorry if anyone lost dough here, but only because I like you, not because you're smart.....

Lon More
30th May 2012, 23:25
Proven once again - you can't make a silk purse out of a sow's ear

I wouldn't give 3 (old)d. for the lot.

ExSp33db1rd
30th May 2012, 23:59
What's Facebook?

( Says one suffering from EGBF - Electronic Gadget Brain Failure )

Load Toad
31st May 2012, 02:30
'Like'.














...

Loose rivets
31st May 2012, 04:46
I wander in now that the Walton on the Naze forums have decided to use it. Within days, I had seen a professional, maybe BBC film, of my old school. My English/art teacher as clear as day. Also, another rusty old black and white film, flickery as hell, but it really displayed the post war era.

So, not all bad.

Oh, and if I want to know what the kids are up to, they seem to find time to go on there even if . . .

Solid Rust Twotter
31st May 2012, 08:05
Damned reality, always intruding where it's not wanted...:hmm:

Flap 5
31st May 2012, 08:12
So the guy who became a billionaire by just messing about may not be as rich as we all thought when reality kicked in. Who would have thunk it eh? :rolleyes:

Mind you being a multimillionaire is still not bad for a guy who lived the dream of so many small, and larger, boys and managed to make it succeed. :hmm:

lomapaseo
31st May 2012, 09:35
Mind you being a multimillionaire is still not bad for a guy who lived the dream of so many small, and larger, boys and managed to make it succeed

But this is not about the guy who made billions, it's about the suckers who lost millions on a dream

RedhillPhil
31st May 2012, 09:49
Search Google for "South Sea Bubble".

Ancient Observer
31st May 2012, 10:24
I'm with con-pilot on this. I did not buy kidsbook stock. Normally stock goes down by huge amounts when I buy it. As I didn't buy it, why did it go down?

For a fee, I'm happy to tell folk what I am about to buy, so you can short it.

AlpineSkier
31st May 2012, 14:51
Can anyone tell me the real aim of an IPO ( especially if this is "recognised " by the finance industry ?

1) Is it to make max possible money for the owners and the company ( i.e. highest poss launch price )
2) Is it to establish the company at a price that allows new investors to make money in short/medium term ?

Storminnorm
31st May 2012, 15:32
I once bought shares in the Daily Mirror. They plumetted after the launch.
Then the owner died in odd circumstances and they rose again. I sold the
shares and just broke even.

bnt
31st May 2012, 20:37
Can anyone tell me the real aim of an IPO ( especially if this is "recognised " by the finance industry ?
Strictly speaking, the purpose of an IPO is to make a company tradeable publicly, in whole or in part. Your option (1) is a given - that's just Capitalism. The definition of "maximum" is "whatever the market will bear". The price of FB stock was increased several times in the days before the IPO, hitting the market at the top of the range they set ($38). And some people did buy that that price, and it went up to over $42. So they were right, the market did bear it ... temporarily.

As for your point (2) ... once Zuckerberg or any private seller got his $38 per share, what interest does he have in helping investors by "making a market"? They're not going to help him.

I mean - I'm no professional investor, but every basic metric was screaming "overpriced" by the start of the IPO. P/E of 80-100? (Insert swearing here.) This was no secret, so why did people buy? To make money off of each other. Everyone who rides a bubble thinks he can cash out at the top, and leave some other sucker without a chair when the music stops. Good luck with that ... :}

mixture
31st May 2012, 21:25
P/E of 80-100? (Insert swearing here.)

Not defending FB here, I think we all agree FB stock was just an artificial bubble waiting to burst

However, it pays not to over analyse .... back in November 2011, I bought into a stock with a P/E at the time of 124. The stock has doubled in value and P/E has reduced. Creamed off a bit of profit by selling 40 odd shares last week and netted 1,750. :E

Sir George Cayley
31st May 2012, 21:39
I've been burned by two institutions. The Stock Market and Turf Accountants. Now I can't remember which one stung me for what:confused:

Shares are for big boys- small investors are generally seen as cannon fodder who help fund the wheels and cogs of the system.

Watch the indices just before the sumer holidays. Up then down - profit taking for the yacht charter.

Actually it's not Zuckerman but the advisors and market makers who appear to work for you but actually work for the big players off whom they feed regularly.

I know because I helped float a company on the SE and saw at first hand who really won.

SGC

vulcanised
31st May 2012, 22:43
The Stock Market and Turf Accountants


At least withe the former you (usually) get some of your money back.

Load Toad
31st May 2012, 23:14
This is indeed the age where people go to the casino, gamble & then whine that it is someone elses fault when they don't win. And they expect a refund.

'I hoped to profit greatly from the greed of others & now I'm sad.'

Phuq 'em.

arcniz
1st Jun 2012, 00:42
This is indeed the age where people go to the casino, gamble & then whine that it is someone elses fault when they don't win.

Please give a bit of considerate thought to the other side of the pasture -- where the legions of really hard-working entrepreneurs and their youthful minions have been struggling, against odds, to launch and nurse along ventures of their own which, as part of the nature of their business model and intended scale of operation, ultimately depend on financing through public offerings to allow continuing existence and growth.

The effect of an incompetent greedy flub like the FB offering is to undermine and possibly destroy public credibility of such IPO financings altogether until one or several years have passed, economic cycles have cycled, and the stars of opportunity for IPO launches have once again risen and aligned. Effect of broken IPO market is no air supply in prospect for an indefinite time for fledgeling ventures in the pipeline, and perception of that likely causes their interim financing to evaporate and kills 'em sooner rather than later as a "loss-containment" measure by the bean-counting VC's that provide and control, by subsidizing them, their pre-IPO survival or demise.

Like an ill-wind in Spring, a lot of baby birds never get to fly at all - when 'stupid and greedy' rains out the Season.

mixture
1st Jun 2012, 12:31
Shares are for big boys- small investors are generally seen as cannon fodder who help fund the wheels and cogs of the system.

Watch the indices just before the sumer holidays. Up then down - profit taking for the yacht charter.

Sorry Sir George, but I call FUD on that one.

High-frequency algorithmic trading as practised by the hedge funds and other institutional market players constitutes a large proportion of daily market volume (well over 50% of all transactions).

Trades made by retail investors constitute a substantially smaller part of the daily market volumes. Therefore trades made by retail investors have little effect on the market itself, only earning commission for their brokers but they don't fund any other "cogs". The market volatility and movements are down to the larger players and their automated trading. The brokers are not the ones doing the high-frequency trading (unless you've got a trading account with a major entity such as Barclays who may well have a so called "casino" division).

Also in the context of global markets, there is no such thing as "summer holidays".

To be perfectly frank, its a waste of time to keep all your money in the bank these days. Sure, keep a proportion based on your attitude to risk.... but keeping it all there, you're just loosing money as no bank pays interest rates high enough once you take into account taxation and inflation.

The problem is, many people invest in the stockmarket using either mechanisms they don't fully understand (CFDs etc.), or invest in companies whose industry they do not understand. If you don't understand the industry in which the company you are investing in operates, then you have no real way of taking an educated guess at how they're likely to do against their competitors, and how the industry they operate is likely to do over the upcoming years.

Burnt Fishtrousers
1st Jun 2012, 14:17
Facebook is as succesfull as its ever going to be..everyone is on it so the advertisers have the captive audience

Theres only one way the share price can go and thats down.

The idea of the social media is simple and stagnant. What other innovations can they come up with?..none

If Mark Zuckerberg comes up with a car engine that runs on piss I shall buy shares in his company at the begining

Romulus
1st Jun 2012, 15:05
Facebook has scale.

Facebook has information that allows tailoring of offers for products and services.

Facebook has the ability to have people accept willingly what others cannot force upon them.

Facebook will be "monetised" and that revenue will be at fricking massive margins compared to traditional business. Amazon might well suffer - every book reader talking about a book leads you to Facebookarama just in case you want an easy one click purchase, Facebook Phone let's you utilise VoIP services to your mobile and connects you anywhere in the world, Facebook Cloud lets you store and share data securely among workgroups, etc etc etc.

Facebook was certainly overhyped but to say it has no future is dangerous indeed. Sure, it may do a MySpace and tank, but it has scale and capability that most businesses would die for.

Angry Birds for $1bn =- there's a whole different story...

AlpineSkier
1st Jun 2012, 17:35
I think a FaceBook phone is very high risk and that's just because of Zuckerberg's personality to start with.

Unlike his current toy where lack of functionality doesn't do much other than raise addicts' blood-pressure, having a phone that screws up will be bad news.

Why do I think this may happen ? Well ZB has cemented his position as top dog and does what he likes - the numerous nonsensical decisions he has made and had to reverse ( like informing all your friends when you bought a specific product ) are proof of this.

I just can't see him accepting that things like communications protocols and international laws really have to be respected and so see him ending in the dirt.

It might be different if he just buys a model from HTC and does an "own brand" but then his success depends on his customers staying with him through inertia/loyalty and I really don't know how likely that is. Certainly not likely enough to boost the share -price, but then I won't be buying it anyway

Tableview
2nd Jun 2012, 14:34
"Facebook is acting like its stock. It keeps going down,"
Facebook has suffered a series of service disruptions which left many people unable to use the social network.

BBC News - Facebook users suffer service disruptions (http://www.bbc.co.uk/news/technology-18294049)

james ozzie
2nd Jun 2012, 21:02
I hear people getting cross with the techno-nerd founder 'cos their shares tanked - I am 100% sure he did not set the IPO price but his advisers did.

Pre IPO numbers chucked around: 900 million users; IPO market capitalisation of $100 billion. So eliminate the zeros and ask: How can Mrs JO's facebook address be worth $111.00 to an unrelated 3rd party investor???

arcniz
3rd Jun 2012, 02:40
$111.00

RIGHT POINTY, j.o.