Facebook – A busted IPO

Sipping a coffee at Nespresso I watched the IPO unfold and drop dead! And just days after the most anticipated I.P.O. since Google or so, shares at Facebook are down about seven dollars from their initial price. Last week alone, Facebook’s stock dipped 8.5 percent. And so whose fault is it, really? Financial analysts are blaming . . . everyone.

The Underwriters: JPMorgan, Goldman Sachs, and Morgan Stanley
Bloomberg reports that a group of investors filed a class-action lawsuit against the banks, claiming “[t]he true facts at the time of the IPO were that Facebook was then experiencing a severe and pronounced reduction in revenue growth.” Just before the I.P.O., one of the banks, Morgan Stanley, reportedly informed “major clients” that Facebook wasn’t going to perform as well as originally hoped. This is the absolute last thing JPMorgan needs right now, so everyone please just stop yelling.

Your Stupid Cell Phone
The reason Morgan Stanley lowered its expectations? According to Reuters, “the company expressed caution about revenue growth due to a rapid shift by users to mobile devices. Mobile advertising to date has been less lucrative than advertising on desktops.” Are you happy now? Don’t answer that if you’re reading this blog on a phone. Don’t you dare.

The Media
Is there any problem that cannot be pinned on America’s drooling, hegemonic fourth estate? We wouldn’t know—we are merely uncritical sheep. Per MarketWatch: “The media propped up Facebook (US:FB), too, confusing a terrific social-media service with a hot stock. The journalists should have been savvy enough to see through Wall Street’s foolish promises.” Be sure to share this MarketWatch article on Facebook.

General Motors
A tenuous-at-best connection—the car manufacturer recently announced it was yanking its advertising from the site—but some people buy it, so let’s just throw the mic to one of them at MSN Money: “Then there’s General Motors (GM +0.70%), which for some reason decided to drop a turd in Facebook’s punch bowl just days before the IPO.”

Barack Hussein Obama
Why not?

NASDAQ
On I.P.O. day, a glitch “delayed Facebook’s market debut by roughly half an hour, and later delayed order confirmations.” Angry investors wielding legal briefs and pitchforks are suing about this, too.

And Finally, Facebook.com
A different gentleman has filed a different class-action suit against Facebook, “alleging that Facebook’s registration and prospectus were materially false.” It would be the first time anyone lied about anything on—or in the context of—Facebook.

We hope you passed on FB!