1024 The IPO
What ever happened to taking risks? Facebook’s initial public offering -- its IPO -- was one of the biggest busts in recent history. After months of buildup, they finally started selling their stock. But the expected frenzy of activity died aborning.
Anyone with any brains could tell you that while people use Facebook a lot, almost no one responds to the constant barrage of ads. GM, which no longer has money to burn decided to cancel its advertising contracts. And as Engine Charlie Wilson of General Motors is often misquoted as saying, What’s good for General Motors is good for the country. In this case that’s true. (Wilson actually said “what’s good for the country is good for General Motors and vice versa.”)
If GM bails on a big contract with Facebook, what does that mean for Joe’s Real New York Pizza of Pocatello, Idaho?
The banks and others tried to shore up the stock. It didn’t work. Plus there were trading delays caused by some computer screwup.
And first day buyers are all atwitter (oops) about losing their shirts on Facebook. Hey... you buy in, you might do well and you might lose your shirt. What do you want, FDIC insurance on your stupidity?
What drives the stock market? Institutionalized investors. Forget the old-time widows and orphans who bought carloads of AT&T, GM, GE, Long Island Lighting. Nice conservatively run companies with dividends you could live on. The widows and orphans don’t stand a chance in today’s world. Stock prices are swayed by whether the heads of a couple of mutual funds and retirement systems get up on the wrong side of the bed on a particular morning.
Buying stuff -- even from MegaBucks TV -- carries risk. So don’t get all out of joint when a pump and dump stock just dumps.
From the mailbag: A reader writes a general comment ending with “try not to be an idiot all of your life.” Dear Reader: I have not yet lived all of my life, so there’s still hope.
Another reader objected to my including Newsday’s Ellis Henican in a list of top newspaper columnists. My opinions are my own and you’re welcome to reject them as you are to accept them.
After running “Dishwasher logistics,” in came an e-mail that asked “you wash dishes?” Nope. The machine does. But I have learned to fake polishing the furniture by spraying Pledge into the air and leaving the can sitting in plain sight so it looks like (and smells like) it’s been used.
--China and Taiwan are trying to outdo one another in improving relations across the Strait. At the same time, both sides are building up their military, buying or building new jet fighters and placing landing strips in places that make it easy to stage an invasion. Believe the Air Forces, not the politicians.
I’m Wes Richards. My opinions are my own but you’re welcome to them. ®
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© WJR 2012