Trading

Facebook IPO Best Investment Ever

Every news outlet including the biggest: Bloomberg, The Wallstreet Journal, The NY Times will have you believe that Facebook is the worst stock ever.  They successfully managed to hype up the stock on IPO day as the “Must by Stock – Solve All Your Financial Problems of the Century”, and as soon as it came out and didn’t jump 100 points, immediately declared it a failure. This is exactly what big investment firms wanted. Why pay $40 for a stock when you can sell it a t $40 and buy it back at $28?

Excuse me: but did anyone bother to look at Google’s chart for the first month?  Am I seeing a repeating pattern?  Google dropped for the first month it was out – after that it never looked back.  People have extremely short memories and in one year when Facebook is worth twice as much as it was, everyone will claim that they told you to buy it. Out of the blue you will start reading about how FB stock is a great investment.

The NY Times even came out with a sensational article about Joe Shmo the loyal MBTA employee who invested a whopping few thousand in FB stock, but then [email protected]$% himself the next day when the stock dropped a few points and sold out at a loss. Later on they published another article “Small Investors Seek Answers to the Confusion of Facebook Trading.” Here’s the answer: stop looking to investment firms and news outlets to invest your money for you.

Here is the breakdown of what has happened with Facebook Stock up until today:

The loosers bought Facebook  on IPO day and sold their shares the following day as the stock dropped a few bucks; the big winner investment firms sold their stock at $40 to the loosers; and the small time winners purchased FB on IPO day, and then continued to purchase it all the way down. In a few years time, those who invested now and held the stock and went about their daily lives and jobs will check their portfolios and will be pleasantly “surprised” by their modest investment. Now that Facebook bottomed out, investors are buying back the stock in bulk and the price is going back up.  Financial news outlets are reporting miraculously that Facebook stock is going up.  That somehow this piece of dog poop of a stock that is not worth even $7 is somehow crawling up.

If your investment strategy is to follow what news outlets say, then you might as well stop now and go to the casino.  If it was that easy, then markets would be completely predictable and there would be no loosers.  But someone has to win, and someone has to loose – that’s the way the game is played. And usually it just so happens that the winners are the big dogs with lots of money because the small guy is jittery.

Major jumps in stock occur prior to public knowledge, and so it isn’t going to help you to wait for good news to come out before purchasing.

We could go into a lengthy discussion of “10 Best Reasons Facebook Stock is a Great Buy!”

“Placing aside all of the naysayers and all the nonsense you have heard so far  and have been brainwashed with, let us analyze in a global sense what FB is all about:
Facebook is the most searched keyword and most visited website on the internet.

It has one of the largest, if not largest, internet user basis in the world.

No matter what Google tries, they can’t seem to hack a way at the social networking marketing.  They’ve already tried numerous social networking platforms that were all abysmal failures.  There newest attempt with Google Plus is another sad attempt to compete with Facebook.

The fact is, Mark Zuckerberg is another Larry Ellison, Bill Gates, Steve Jobs, Larry Page and Sergey Brin. He is not a man motivated by money. He was offered a ludicrously large sum – $1 billion dollars from Yahoo in 2005 for Facebook.  Wait, let me just write that out in zeros so you can try and catch that again:  $1,000,000,000. He didn’t blink twice when saying, “No.” Do you think its possible that he knows something that others don’t?

AND WHY and WHY and WHY Facebook is such a great stock.  The fact is – Winners don’t need to explain anything to anyone. If you are a day trader, than forget this argument.  But if you are looking for a long term investment, than put your money in FB stock today – while it’s still cheap.

I am very excited to see all the responses to this post of “how big of an idiot the writer of this article is,” and how smart people are and how they won’t invest a dime in this worthless stock and how I even haven’t addressed the financials and how Facebook isn’t making money etc…

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