facebook ipo - opinions - play by play - keep it brief

Quote from Swan Noir:

Bernie Madoff was an entirely different situation..........
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Facebook posts huge revenues. In fact, recent reports are that Facebook is very profitable. This boosts both their respect in the world and their valuation.

However, these returns, while real, are unsustainable.

They exist and are sustained in the same manner that Ponzi schemes are.

People go to Facebook to interact with their friends. It is fundamentally different from the ad platform that is Google.

People go to Google to find something they need, possibly ready to buy, which a good percentage of the time can in fact be solved by someone's ad.

Facebook ads, on the other hand, annoy users. They yield no real value, and thus no profits. What is clear from everyone I know who has advertised on Facebook is that it was a waste of money.

Facebook promises big returns on ad spending, but delivers nothing.

Facebook is a Ponzi Scheme............:D

s
 
I trade only futures but there was a time in the 90's when I traded tech stocks. My experience with "hot" is it has to stay hot. Once it becomes a broken deal -- and this is a very broken deal -- there is no telling at what level it will turn.

I guess if I liked the fundamentals (and I profoundly do not like them north of $20) I might buy it at some point if I were a value investor. If it is a bull market (and it still is) i would be much more interested in stocks with momentum even at new highs. if you judge it at some point not to be a bull any longer you should own nothing but short positions in stocks that have already broken down -- off their highs, made a failed stab at moving to a new high and now headed down.

The wild card here is Europe. I have friends in Spain and Italy -- with a partner I owned two small brokerage firms in Europe in the 70's -- and they tell me their smart friends are taking money out of the bank and their not so smart friends are saying it will be alright. I think Southern Europe is dead broke and as a friend of mine said "giving a credit card to an Irishman is never a smart move". My opinion is that we are in a bull market yet within the next few years disaster will strike and at least Spain but probably not Italy will default. Bank runs could come much sooner. The question for me is will bailing the banks out bankrupt the sovereigns. I think it some cases it will.

To your point. FB is crap right now. Broken deal that could go lower or just sit there. My apologies to the OP ... I forgot to keep it brief or on topic!!

Quote from cactiman:

Swan Noir,
Is there a price where you would go Long in FB?
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A business that is destined to fail because demand is not sustainable (your contention and quite possibly correct) does not meet the definition of a Ponzi scheme. It is a fad and, like many fads, it gets sold at a much higher price than its long term value warrants.

I also believe GroupOn may well prove to be a fad yet, for the right type of business, it has value in the moment. The flip side of the coin may well be LinkedIn. I believe that company will be with us and prospering 20 years from now. That said, I have no clue as how to value it currently.

Quote from shopster:

Facebook posts huge revenues. In fact, recent reports are that Facebook is very profitable. This boosts both their respect in the world and their valuation.

However, these returns, while real, are unsustainable.

They exist and are sustained in the same manner that Ponzi schemes are.

People go to Facebook to interact with their friends. It is fundamentally different from the ad platform that is Google.

People go to Google to find something they need, possibly ready to buy, which a good percentage of the time can in fact be solved by someone's ad.

Facebook ads, on the other hand, annoy users. They yield no real value, and thus no profits. What is clear from everyone I know who has advertised on Facebook is that it was a waste of money.

Facebook promises big returns on ad spending, but delivers nothing.

Facebook is a Ponzi Scheme............:D

s
More...
 
Quote from Swan Noir:

I trade only futures ... My apologies to the OP ... I forgot to keep it brief or on topic!!
More...

No, no need to apologize. Solid post! And not TOO long by ET standards. :) We are over the initial days' excitement anyhow.
 
Quote from shopster:

Facebook posts huge revenues. In fact, recent reports are that Facebook is very profitable. This boosts both their respect in the world and their valuation.

However, these returns, while real, are unsustainable.

They exist and are sustained in the same manner that Ponzi schemes are.

People go to Facebook to interact with their friends. It is fundamentally different from the ad platform that is Google.

People go to Google to find something they need, possibly ready to buy, which a good percentage of the time can in fact be solved by someone's ad.

Facebook ads, on the other hand, annoy users. They yield no real value, and thus no profits. What is clear from everyone I know who has advertised on Facebook is that it was a waste of money.

Facebook promises big returns on ad spending, but delivers nothing.

Facebook is a Ponzi Scheme............:D

s
More...

As someone who has previously advertised on Facebook, I agree with this. Also, a lot of companies that have business/fan pages do not advertise using the ad platform. Instead they just post offers on fan pages for free, over and over again since they already have a huge following.
 
Quote from Swan Noir:

I trade only futures but there was a time in the 90's when I traded tech stocks. My experience with "hot" is it has to stay hot. Once it becomes a broken deal -- and this is a very broken deal -- there is no telling at what level it will turn.

I guess if I liked the fundamentals (and I profoundly do not like them north of $20) I might buy it at some point if I were a value investor. If it is a bull market (and it still is) i would be much more interested in stocks with momentum even at new highs. if you judge it at some point not to be a bull any longer you should own nothing but short positions in stocks that have already broken down -- off their highs, made a failed stab at moving to a new high and now headed down.

The wild card here is Europe. I have friends in Spain and Italy -- with a partner I owned two small brokerage firms in Europe in the 70's -- and they tell me their smart friends are taking money out of the bank and their not so smart friends are saying it will be alright. I think Southern Europe is dead broke and as a friend of mine said "giving a credit card to an Irishman is never a smart move". My opinion is that we are in a bull market yet within the next few years disaster will strike and at least Spain but probably not Italy will default. Bank runs could come much sooner. The question for me is will bailing the banks out bankrupt the sovereigns. I think it some cases it will.

To your point. FB is crap right now. Broken deal that could go lower or just sit there. My apologies to the OP ... I forgot to keep it brief or on topic!!
More...


Thanks for your time and thoughts.
I hope you're right about the Bull Market/Momentum Stocks part - my being Long in AAPL, CMG, ISRG, MNST, LNKD, ROST, DLTR, etc.
But I hope you're wrong about the Southern Europe Disaster part! Ugh....
Will keep watching FB. Not in a rush to jump in.
Maybe with their brain power, and big new lump of cash, they can come up with a steady growth/earnings plan? We'll see.
:)
 
Quote from shopster:

Facebook posts huge revenues. In fact, recent reports are that Facebook is very profitable.

============

Facebook promises big returns on ad spending, but delivers nothing.

Facebook is a Ponzi Scheme............:D

s
More...

Those statements are contradictory. Their revenues are largely based upon ads. To state it's a Ponzi is libelous against a co worth nearly $90B. I personally wouldn't want to defend against a comment made in jest.
 
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