Peter Schiff on facebook and he is totally right!

Discussion in 'Stocks' started by S2007S, May 24, 2012.

  1. S2007S


    I think Peter Schiff is reading my posts, he said the same thing I said a few days ago about how the best days of facebook are behind it, he is 1000% correct on that, and the reason is simple, there are about 7 billion people in the world, about 2.3 Billion are connected to the internet and out of those many people 900+ million are on facebook...does that make sense now or do some fools in here still need math 101 to comprehend that the huge growth days for facebook are over. The only people who made the money off this ipo and company again were those buying on the secondary market years back when it was trading at just a few dollars a share. Of course those who were able to participate in the secondary market arent your regular mom and dad or friend, they were people with lots of money. So most of the money has already been made on facebook. Facebook from 2004 to the day of the ipo had its biggest growth ever, it will NEVER, NEVER have that same growth ever again. That kind of growth is over.

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    Less than a week after Facebook's (FB) IPO there are already rumors that Facebook is considering a move from the Nasdaq (NDAQ) to the NYSE (NYX). According to Peter Schiff of Euro Pacific Capital, switching exchanges will accomplish nothing for Facebook.

    "The problem isn't where it's listed—it's the valuation!" says the author of The Real Crash.

    Though valued like a growth company, Schiff thinks Facebook's best days are behind it. "How many people on earth are members? It's not like there's that much opportunity to grow." For the record, there are roughly 6.8 billion people on earth, 901 million of whom have Facebook accounts.

    Schiff says Facebook is only the latest example of a flawed system. He blames the regulators, not because there are too few rules, but because there are way too many. The high cost of jumping through regulatory hoops means only more mature, expensive companies can afford to go public. Up until then, the only people invested in a company were Venture Capitalists, Private Equity, and assorted well-connected, well-heeled individuals.

    Those lucky few are using the IPO as a chance to cash out to the public. "By the time the average American gets a shot at all, the upside is gone," says Schiff.

    In the case of Facebook, the little guys may have gotten doubly hosed. During the road show, the underwriters reportedly lowered earnings estimates prior to the IPO, then only disseminated the news to select institutions and clients.

    The specifics of Facebook are different, but in the larger picture Schiff says the Facebook IPO is no different than any other offering. The insiders who are selling know the company is ripe to be sold while the outsiders wager on better days.

    Schiff says of the average IPO investor: "You're betting on the come but meanwhile you're paying through the nose." That's not a recipe for investing success.
  2. wrong, wrong and wrong.

    facebook today is mainly usa+canada+western europe.
    it will *slowly* expand into asia/middle east.

    do you have any idea what % population growth there is in pakistan, bangladesh, nigeria, indonesia, etc?

    the world will have 20 billion people 20 years from now.
    Perhaps 9 billion will use FB.
    x10 more vs today.

    Add e-commerce /auctions / micropayments / etc. to FB and....
    see the potential?
  3. S2007S


    Really 9 billion people on you really think that?

    Add ecommerce, auctions and mircopayments

    Ecommerce? Amazon??? right? and another 20,000 websites that sell things over the internet.... facebook should have monetized that one about 5 years ago.

    Auctions belong to a company called hmmmm ebay and another 5+ big sites that do the same thing.

    Micropayments, I think you mean Paypal.

    facebook has zynga and advertising....900+ users and just $1 billion in revenue a quarter, what happens when they start to lose some of those users, revenues are are going to drop significantly.
  4. Are you serious?
  5. S2007S


    I hope he was being sarcastic because 9 billion will NEVER happen, maybe 1 billion but 9 Billion haha.

    20 years from now no one will know what facebook is.
  6. hajimow


    The fact that the manipulators try to pull it higher AH, says FB is a hype.

  7. lol... I don't want to live on this planet with 20 billion people.

    Everyone will be too busy fighting for food and water there won't be any time left in the day to log on.
  8. Schiff's impression of Captain Obvious. The entire space is littered with companies with a failed biz model. Look at AMZN at what, 170x earnings? They earn 1% net.

    You know the Keynes cliche is coming... the market can remain irrational longer than you can remain solvent. AMZN has been >$200 for over a year.
  9. Quote from Wikipedia:

    Using linear interpolation and extrapolation of UNDESA population estimates, the world population has doubled, or will double, in the following years (with two different starting points). Note how, during the 2nd millennium, each doubling took roughly half as long as the previous doubling, fitting the hyperbolic growth model mentioned above.

    Population (in billions)
    0.5B 1B 2B 4B
    Year 1500 1804 1927 1974
    Years elapsed 304 123 47

    2012: Population almost doubled again to 7.1B.
    2012-1974 = 38 years.

    304 years, 123, 47, 38.... 20?

    Years 1990-2010, the population of these countries has increased by:

    India: 40.2%
    Pakistan: 55.3%
    Nigeria: 62.4%
    Bangladesh: 41.3%

    Consider the fact, that during the next 20 years, technology could lift the quality of life of poor nations so high, that they can double the population.
    Add increasing life spans, because people may no longer believe in eugenics : vaccines, monsanto products, cancer industry and so on.
    Instead of 60 yrs, people could easily live 120.

  10. not to be a pain your intentions seem really great but higher chance of WW3 and loss of half population before anything goes any higher to much tension not enough resources.
    #10     May 24, 2012