The
Facebook IPO: The Last Great Wall Street Party
http://theeconomiccollapseblog.com
http://albertpeia.com/lastwallstreetparty.htm
‘
‘The Facebook
IPO is kind of like a graduation party - everybody comes together for one huge
blowout to celebrate the end of an era before going their separate ways.
Unfortunately, most people on Wall Street do not understand how bittersweet
this moment really is. A tremendous amount of pain is ahead for Wall Street
in the next few years, and we will probably never see anything like the Facebook IPO ever again. But the Facebook
IPO sure has been fun to watch. Facebook is one
of the largest companies to ever go public in the
During
the IPO process, Facebook sold more than 420 million
shares and raised about 16 billion dollars.
Those
are incredible numbers.
At 38
dollars per share, Facebook would have a market cap
of about 81 billion dollars.
So is
Facebook worth 81 billion dollars?
Of course not.
But
most stocks are tremendously overvalued at this point.
Yes, Facebook has 900 million users and it made about a profit
of about a billion dollars
last year.
But
that does not add up to an 81 billion dollar company.
Not
even close.
A
recent article by Jay Yarow
explained this in more detail....
As
good a business as that is, it's not Google good. It's not Apple good. And at
the current IPO pricing, Facebook has to be a much
better business in the near future.
In
fact, Yarow says that Facebook
is going to have to dramatically improve in order to justify the current
valuation....
So,
what's the bull's case for Facebook? Unfortunately,
it comes down to faith. You have to have faith that Mark Zuckerberg,
Sheryl Sandberg, and the rest of the executives at Facebook
will discover a magical money making product that will justify its valuation.
Unfortunately,
there are already signs that the growth of Facebook
is slowing down.
Advertising
revenue during the first quarter of 2012 was only $872 million. That was a decline
of 7.5 percent from the previous quarter.
And
eventually someone will come along and topple Facebook
just like Facebook toppled MySpace.
Remember
MySpace?
Facebook did not even exist a decade ago.
Right now there are young kids tinkering around in their college dorm rooms
trying to figure out how to create something that will be even better than Facebook.
The
truth is that Facebook is operating on borrowed
time. It is not going to remain "hot" and "trendy"
forever.
But
for the moment, there are a whole lot of people out there that want a piece of Facebook.
Hey,
I am not in the stock market at all, but even I am half-tempted to buy a few
shares so that I can introduce myself as a "part-owner of Facebook".
After
all, who doesn't like Facebook?
Yes,
government agencies and big corporations use Facebook
to spy on all of us. If you don't believe this, just check out this article, this article and this article.
But
there is an incredible upside to social networking websites such as Facebook and Twitter as well.
They
have given average people the ability to communicate directly with each other
on a massive scale.
In
the past, the big corporations pretty much had a monopoly on mass
communication.
If
you wanted to get your message out independently of the big corporations, you
could hand out fliers, you could send out mass mailings (very expensive) or you
could try to get a book printed.
But
today something that you post on Facebook or Twitter
could be seen by thousands (or even millions) of people within a few days.
The
Internet is filled with a whole lot of garbage, but it can also be used as an
incredible tool for good.
Sitting
at home behind your desk, you have the potential to touch the lives of people
on the other side of the globe through the Internet that you would probably
never have a chance of influencing any other way.
So I
am very thankful for Facebook.
We
should use tools like Facebook to wake people up
while there is still time. Our world is becoming increasingly unstable
and we might not always have the opportunity to freely share our thoughts with
the entire globe like this.
Just
try to imagine a world without Facebook, Twitter,
YouTube, blogs and Internet forums.
All
of those things have only existed for a relatively short period of time, and
there is no guarantee that we will always have them.
Instead
of wasting our lives away in front of our televisions, we should be taking
advantage of these tools to help change the world.
Every
single day, hundreds of people are directed to my website
from Facebook. I am hoping to eventually
increase that to thousands of people per day.
A
great economic collapse is coming to this world. People need to keep
their eyes on the financial crisis in Europe and
on the derivatives market. The coming financial
tsunami will likely be even worse than the crash of 2008.
People
are going to be looking for answers.
Now
is the time to be a light shining in the darkness.
Not
everyone has the time or the knowledge to be able to set up a website or make
YouTube videos, but nearly everyone is capable of setting up a Facebook account or a Twitter account.
If
you make even a small effort, you could end up touching the lives of thousands
upon thousands of people.
Yes,
there are a lot of negative things that can be said about Facebook,
but at least for today let us celebrate it for what it has given us.
It
has given us the opportunity to make a difference on a massive scale, and that
is a wonderful thing.
