Underwriters band together, keep FB above 38. Market manipulation?

Imo, the reason FB started trading on a Friday is that no one could keep this from going down 2 or 3 days in a row.
 
10 -15 years ago when tech companies were shopping for IPO representation... Wall Street firms would argue they should be in the lead because they had the cash and the infrastructure to stabilize. That was one of their selling points. So the negotiations were frequently about how much support they would provide.

Not sure if it still works that way.
 
Quote from rmorse:

I believe they call it "stabilization." I call it an IPO priced with hot air.
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Ok. I'm going to get some Elite Traders together and we'll run a thinly-traded stock higher.

Then we'll collaborate to "stabilize" the stock at a high level.

Any problems with this plan?
 
The concept of a syndicate bid was written right into the securities acts of the 30's. Yes ... it is manipulative but like many things in life a bit of leeway is part of how a system stays functional.
 
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