Wednesday, May 29, 2013


I've been quite open about my dislike of Facebook and how they and their investment bankers ripped off their IPO investors.  I've also been upfront about how I don't believe that FB is going to be a lasting and viable company as we've already seen its popularity with younger folks wane.

Yes, they have a billion users, which love to waste time and share their fake (made up) lives online.  I've also been quite frank noting that FB lives are the ones we wish we had where everything is great, we are successful, and our kids aren't spoiled, and we earn 10 times what we really do.  (Ok, I'm being sarcastic, but I think there is some truth to what I type!).

Anyway, Tim at Slope of Hope put up a  marvelous short idea today about LinkedIn and the chart looks really ready for a fall.  I do believe that LNKD is actually one of the only good social medial/tech companies out there, but I think I fall into Tim's camp that it has an obscene valuation and needs to be corrected.   Noting his short, I went back to my charts and looked up my old buddy FB that simply continues to disappoint and muddle along while others like LNKD, GOOG, and even NFLX have shot higher.
Tim's post -

LNKD chart -

As I look at the chart of FB, I see a $19 handle in its future.  Once again, those that got creamed in the IPO just keep on getting bad news. FB chart link -

Finally, the fundamental news looks poor for FB as well as advertisers are not liking the placement of their ads next to questionable or even offensive Facebook posts by users.  As we know, social media and targeted advertising bots read and follow your online activities and then "show" you ads based on what you have previously looked at or what advertisers hope that you'll buy.  The funny thing though is that you might be surfing the social media pages or the web and looking at "bad stuff" and right next to that material you'll get an advertisement for diapers, or a McDonald's burger, or even a generator (if you've been searching online for them).  In the attached story from ThinkProgress we find that advertisers don't like the idea of you looking at posts of domestic violence or some sort of assault and seeing their images and logos!  I thought we heard that FB had figured everything out regarding advertising and mobile advertising?!!   By the way, I have never, ever, ever purposefully clicked on an advertisement on mobile.  I unfortunately fat-finger those stupid ads daily when on my mobile phone.  Mobile advertising is simply a total waste in my book, and guess what, that is what FB has tied itself to.

Good luck with that.  Short till $19.50 on FB.


Goatmug is an investor that cares about you and your family. Goatmug's Blog - Financial Perspectives From The Mountain Top is a collection of thoughts on our economy and how it impacts the lives of investors and average people. While several specific investments are named in many of his posts, these articles are simply invitations for you to do your own research and reference to these securities does not constitute financial advice. Your situation is complex and unique and you should seek professional assistance with your trading and investing. Please visit Goatmug and share your comments at