Facebook plunged another 9 percent yesterday.
I hadn’t planned on posting on this, but Facebook is my number one read subject the past couple weeks, so apparently you guys care about it.
As I wrote in the beginning of May, Facebook is going down, and fast. In that post, I laid out why I thought all the analysts were wrong — remember, back then, everyone was yelling and screaming about how awesome Facebook was and how big this could be once they went public on the stock market.
After I wrote that post, another blogger who’s way smarter than me had this to say (well over a week later):
This puts Facebook’s market cap at approx. $100 billion or more. To put that in perspective, Facebook is:
• Bigger than McDonald’s
• Two and a half times bigger than Ford
• Bigger than FedEx and UPS combined
• Bigger than Kraft Foods and General Mills combined
• Bigger than Boeing and Lockheed Martin combined
This is insanity. (Link.)
Let’s not forget the $10 million a year GM yanked in advertising from Facebook, nor how the stock price dropped 10 percent after they had a totally lame stock offering. (See story: Facebook stock plummets on second day of trading.)
At this point, Facebook is no longer a giant who’s feared. It’s looking increasingly weak, and these lawsuits aren’t going to help…
So, the moral of the lesson is this…
If your stock broker was raving about Facebook before it went public, fire him. (I’m a nobody and I saw this coming, as I laid out in the dated posts above.)
If the news you rely on was raving about Facebook before it went public, change the channel or get a different source. (The New York Times was highly skeptical in almost all its coverage.)
If your blathering friends or family was raving about Facebook before it went public, remember that the next time they’re yelling and fired up about something. Most people are idiots, and your friends and family probably fall into this category.
Just as you should network up in your business life (instead of down), you should also listen to those who show more wisdom. And more than likely, your broke friend or family member with the High School degree is NOT who you should be listening to.
Stan R. Mitchell
Oak Ridge, Tenn.
P.S. Thanks to all who continue to make my novel Little Man, and the Dixon County War a huge success! It’s gone as high as No. 16 on the Amazon UK Paid List (see here and here), landing smack dab between a Louis L’Amour and Zane Grey book. Learn more about it here.