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BOMBSHELL: Facebook Bankers Secretly Cut Forecasts For Company
Business Insider ^ | May 22, 2012 | Henry Blodget

Posted on 05/22/2012 5:59:24 AM PDT by tired&retired

And now comes some news about the Facebook IPO that buyers deserve to be outraged about. Reuters Alistair Barr is reporting that Facebook's lead underwriters, Morgan Stanley, JP Morgan, and Goldman Sachs, all cut their earnings forecasts for the company in the middle of the IPO roadshow. This by itself is highly unusual (I've never seen it during 20 years in and around the tech IPO business).

Read more: http://www.businessinsider.com/facebook-bankers-earnings-forecasts-2012-5#ixzz1vbRXNlwU

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy
KEYWORDS: facebook; ipo; trigtruther
Business as usual....
1 posted on 05/22/2012 5:59:33 AM PDT by tired&retired
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To: tired&retired

More.... “In other words, during the marketing of the Facebook IPO, investors who did not hear about these underwriter estimate cuts were placed at a meaningful and unfair information disadvantage. They did not know what a lot of other investors knew, and they suffered for it.
Selective dissemination of this sort could be a direct violation of securities laws. Irrespective of its legality, it is also grossly unfair. The SEC should investigate this immediately.
We first heard rumblings about this last week, and we were so startled that we assumed the reports were wrong. Then, over the weekend, when Reuters reported the basic story again, we said that if it was true, Facebook IPO buyers deserved to be “mad as hell” about it. And now Reuters has the details, and they sound as bad as we had feared.
There are a couple of possibilities for what happened.
The first one is bad news for Morgan Stanley and the other lead underwriters on the deal.
The second is also bad news for Facebook.
According to Reuters, the underwriter analysts cut their estimates after Facebook issued an amended IPO prospectus in which the company mentioned, vaguely, that recent trends in which users were growing faster than revenue had continued into the second quarter.”


2 posted on 05/22/2012 6:01:56 AM PDT by tired&retired
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To: tired&retired

Morgan Stanley Was A Control-Freak On Facebook IPO — And It May Have Royally Screwed Itself

Read more: http://www.businessinsider.com/tag:reuters.com,0000:newsml_L1E8GIER0#ixzz1vbSw57li


3 posted on 05/22/2012 6:04:15 AM PDT by tired&retired
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To: tired&retired

I don’t get the Facebook concept, and I sure didn’t get the hype behind the offering.

I’m just a boring utility investor.


4 posted on 05/22/2012 6:07:56 AM PDT by Arm_Bears (Journalists first; then lawyers.)
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To: tired&retired

Just more fodder for the Socialist argument that “Capitalism is a rigged casino game”.

Sooner or later, by playing things too cute, guys like this are going to elect the American Hitler or Stalin.


5 posted on 05/22/2012 6:08:50 AM PDT by Buckeye McFrog
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To: tired&retired

More and more it seems that the purpose of banks, stocks, and investments is to steal from you and be legal in doing so.


6 posted on 05/22/2012 6:10:17 AM PDT by Lazamataz (The so-called 'mainstream' media has gone from "biased" straight to "utterly surreal".)
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To: tired&retired

The purpose was to transfer $$$$$$$$$$$$$$$$$$$$$$$$$
from Main St. and taxpayers to the bankers and DNC.

Mission accomplished.


7 posted on 05/22/2012 6:13:45 AM PDT by Diogenesis ("Freedom is never more than one generation away from extinction. " Pres. Ronald Reagan)
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To: Arm_Bears

I’d bet $10 per share at year end.


8 posted on 05/22/2012 6:15:23 AM PDT by ImJustAnotherOkie (zerogottago)
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To: ImJustAnotherOkie

I’d bet $.10 per share at year end.

I added the decimal point you missed! LOL


9 posted on 05/22/2012 6:20:21 AM PDT by tired&retired
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To: Buckeye McFrog

Wall Street IS part of the statist game. Its not “free market capitalism” - that’s for sure.

We are stuck with Wall Street in its present form as long as we have the Federal Reserve in its present form.


10 posted on 05/22/2012 6:21:35 AM PDT by PGR88
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To: Buckeye McFrog
Most of the assholes involved in this Facebook scam are liberal democrats starting for the the thief who founded Facebook to the people who leads the financial firms who underwritten the IPO... And yes they are all socialists but more like “limousine socialists” where they would be the ones who have all the wealth and power but the rest of us 99.99% of the population would be living equally poor at the mercy of our rules the “limousine socialists”...
11 posted on 05/22/2012 6:23:05 AM PDT by jveritas (God bless our brave troops)
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To: ImJustAnotherOkie

I’d take a chance and buy 100 shares if it went down to $10. I do think the IPO was botched but I wouldn’t discount the value moving up again in the near future. If you have any type of home business, where else can you post your wares for free? For now anyway....


12 posted on 05/22/2012 6:25:34 AM PDT by jersey117
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To: tired&retired

Yet another reason why I have never participated in any IPO that was NOT underwritten by Goldman Sachs. Love them or hate them, but they know how to do it right, as they did (big time) with China’s Baidu (BIDU) in 2008. Morgan is just pathetic.


13 posted on 05/22/2012 6:29:21 AM PDT by montag813
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To: tired&retired

If you accept the underwriter estimates uncritically, you’re not much of an investor. Everyone can see it is in the interest of the underwriter to pump up the stock. Anyone taking a substantial position should work out his own estimates.


14 posted on 05/22/2012 6:29:59 AM PDT by proxy_user
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To: PGR88
We are stuck with Wall Street in its present form

It was much better when Wall Street compamies were partnerships, and committed their own capital. You are much more careful with your own money.

15 posted on 05/22/2012 6:33:06 AM PDT by FatherofFive (Islam is evil and must be eradicated)
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To: tired&retired

"But, just as important, news of the estimate cut was passed on only to a handful of big investor clients, not everyone else who was considering an investment in Facebook."

The wonders never cease.

16 posted on 05/22/2012 6:35:03 AM PDT by Qbert ("The best defense against usurpatory government is an assertive citizenry" - William F. Buckley, Jr.)
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To: Buckeye McFrog
Just more fodder for the Socialist argument that “Capitalism is a rigged casino game”.

True, and , interestingly, engineered by the leftist sleazebag Zuckerberg, and the "stimulus" insider Morgan Stanley.

Sooner or later, by playing things too cute, guys like this are going to elect the American Hitler or Stalin.

And Severin leaving the US makes even more sense.

17 posted on 05/22/2012 6:35:13 AM PDT by Navy Patriot (Join the Democrats, it's not Fascism when WE do it and the law is what WE say it is.)
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To: tired&retired

Link goes to “Whoooops! Page you are trying to locate cannot be found! Not surprising!


18 posted on 05/22/2012 6:37:44 AM PDT by liberalh8ter (If Barack has a memory like a steel trap, why can't he remember what the Constitution says?)
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To: ImJustAnotherOkie
I'll not take that bet.

I read an analysis of it yesterday. If Facebook was valued the same as Google, Apple, and other Tech darlings...

It would be between $6 and $7 per share.

Overblown. Overhyped. But Mark Whatshisface will make a few billion off of it. Can't fault him for that.

19 posted on 05/22/2012 6:59:30 AM PDT by wbill
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To: tired&retired

I look forward to the day when anti-virus programs treat Facebook like the virus it is.


20 posted on 05/22/2012 7:09:21 AM PDT by Wurlitzer (Nothing says "ignorance" like Islam!)
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To: wbill

I guess that depends on who committed fraud and when. Like we will ever find out.


21 posted on 05/22/2012 8:04:55 AM PDT by ImJustAnotherOkie (zerogottago)
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To: tired&retired

Just like the tech bubble. Think about what Facebook does and how it generates revenue. That should give you an idea of its ‘growth’ potential.

Like most tech companies, the value of Facebook is driven by people’s imagination. Very little behind it. Most people already believe it is a fad.


22 posted on 05/22/2012 8:39:09 AM PDT by ABQHispConservative
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To: jersey117

The web is far to volatile to value anything out 10 years. The pe ratio system completely is completely FUBAR in this case


23 posted on 05/22/2012 8:43:17 AM PDT by ImJustAnotherOkie (zerogottago)
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To: tired&retired

This is the kind of thing in combination with guilt by association that makes republicans a hard sell. I am very pro-free market, but until some of these bastards are hung in the streets the sheeple will continue to push for socialism (which incidently only empowers scumbags even more). This is a serious problem that the republican party needs to come up with a solution for. Other than Ron Paul the rest of them just sound like [insert bank name] board members. And Ron Paul would get us all killed, so there has to be another option!


24 posted on 05/22/2012 9:03:34 AM PDT by douginthearmy (Obamagebra: 1 job + 1 hope + 1 change = 0 jobs + 0 hope)
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To: Buckeye McFrog
Just more fodder for the Socialist argument that “Capitalism is a rigged casino game”.

Exactly.

It's a fake scandal.

These analysts who make these future estimates are not allowed to receive information that is not in the prospectus.

That's why the prospectus is so damn long, too long for a lot of investors to bother reading.

So if an "analyst" raises or lowers his guess for future earnings, why is that a scandal? These guys are wrong more often than they are right.

25 posted on 05/22/2012 9:51:54 AM PDT by Meet the New Boss
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