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Jim Van Meerten
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Jim Van Meerten is an advisor to Marketocracy Capital Management and writes on financial subjects here and on Barchart Portfolio Blogs and Seeking Alpha. He earned a BS in Accounting and Business Administration from Berry College; a Juris Doctorate from the Woodrow Wilson School of Law; and... More
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Marketocracy Capital Management
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  • Facebook Fiasco 0 comments
    May 23, 2012 9:24 AM | about stocks: FB

    As Facebook's (NASDAQ:FB) price tanks more and more is coming out about some unethical behavior on Wall Street:

    The Occupy Wall Street movement has been replaced by the Subsidize Wall Street movement. Facebook insiders and venture capitalist pushed to have a higher offering price and to increase the number of shares offered by 25% even while the Underwriting and Selling Groups own analysts were lowering their revenue and earnings projections. Anyone who paid $38 or more were unknowing sheep being taken to slaughter.

    This morning an article in The Financial Times reveals that although the public cannot short stocks till the first settlement date there were a bunch of hedge funds that were able to short shares on the offering date through special agreements made with prime brokers. In my opinion, these short sellers may have had inside information that the Underwriting Group was not going to implement the price support that is normally afforded an IPO for the first 90 days.

    Is there an important lesson for you all to learn? There is a good reason that you should take note of the policy on Barchart that unless there is 6 months of publicly released trading information, Barchart does not have an opinion on the stock.

    I agree wholly with this policy. Always wait until a stock has been public for at least 6 months. If you invest before that date realize that your position is a gamble and not a rational investment.

    As the Old Sarge said on Hill Street Blues: "Be careful out there."

    Stocks: FB
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