Linked by Howard Fosdick on Wed 5th Sep 2012 05:24 UTC
In the News Remember the dot com debacle of a decade ago? Well, it's back, this time in the form of Facebook. Since its high-profile public offering last May at over $38/share, FB is now down to about $18/share. Management is finding that running a public company is very different than one privately held, as people variously blame Mark Zuckerberg (or not), CFO David Ebersman, lead IPO underwriter Morgan Stanley, and even the NASDAQ stock exchange. The real problem, of course, is that Facebook went public even as its business model desperately searches for new revenues. Let's just hope they don't pull a Digg and fatally redesign the whole site in response.
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Re:
by kurkosdr on Wed 5th Sep 2012 16:55 UTC
kurkosdr
Member since:
2011-04-11

"
The gamblers (also called "investors" in some circles) lost big time, and that makes me laugh my ass out but don't confuse their crisis with a Facebook crisis."

This is true only if Zuck has retained more than 50% of the stocks (too lazy to check). If he hasn't, and the investors become frustrated because Facebook's growth rate doesn't meet their arbitary expectations, they can always axe Zuck and replace him with some waterhead CEO (as it so often happens).
Also, the reason a company goes public is to raise cash (IPO means "a part of the company for your cash, in plain english"). So, a low stock price means Facebook is taking in less cash for the same amount of part of the company it sells.

But I agree, in this case the investors (gamblers) are the ones losing the most. Isn't it fun when the bubble bursts before the weasels have time to make any money? Wish it had happened in the dot-com bubble too. Facebook will keep being a strong and profitable company, but the bubble has been bust.

Edited 2012-09-05 17:01 UTC

Reply Score: 2

RE: Re:
by unclefester on Thu 6th Sep 2012 03:01 in reply to "Re:"
unclefester Member since:
2007-01-13

The majority of those "gamblers" were completely unaware they even invested in Facebook. Their pension funds and banks decided it was a good idea.

Reply Parent Score: 3

RE[2]: Re:
by zima on Sun 9th Sep 2012 04:24 in reply to "RE: Re:"
zima Member since:
2005-07-06

Still, they are the people demanding the highest returns WRT their pension plans or savings ...and, if not satisfied, they go elsewhere with their money, to those who promise more satisfying returns (and subsequently are often more risky, aggressive, exploitative, and so on); those "gamblers" largely promote it all.

Reply Parent Score: 2