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Facebook IPO Hubris a Sad Commentary on America

EST

It’s a sad time for America when a firm that does what Facebook does is on track to become one of our largest companies. Based on capitalization, the web-based lubricator of social interaction could be in the top 50 within a few years, or even in the top 25 if analysts’ wildest expectations pan out.  Facebook’s IPO promises to top Google’s $27 billion offering, reaping early backers a giant windfall.  But wouldn’t it be far better if a company that actually made something were to enjoy such extravagant enthusiasm on Wall Street?  Facebook of course makes nothing, and what it sells is of little economic value to anyone. And yet its founder, Mark Zuckerberg, is about to become one of the wealthiest men in the world.

A gushy tribute to his impending monetary success appeared on the op-ed page of the Wall Street Journal yesterday. Written by a Rutgers anthropology professor named Lionel Tiger, this paean to the biggest time-waster in the galaxy saw Facebook’s inventor as “bestrid[ing] vast business numbers once dreamt of only by toothpaste and soft-drink makers. This reflects a new commercial demography in which the consumer is not someone who wants something necesssary, but rather one who seeks to assert simply what he is. And the tool he uses in order to become nothing more or less than an efficient, interesting and socially propsereous primate is the Facebook page.”

Hefner’s ‘Genius’

Karl Marx himself could not have come up with a more powerful indictment of capitalism or of the soulless craving it would seek to create for things we don’t really need. And yet, although he doesn’t say so explicitly, Prof. Tiger would seem to place Zuckerberg – whom he labels “the world’s richest primatologist” — in the Pantheon of human genius with DaVinci, Einstein and Gutenberg. For sure, a vast number of users all over the world are Facebooking at any given moment. But let’s not kid ourselves, professor. If someone were to offer a porn site that allowed men to have their way, virtually speaking, with the Hollywood babe of their choice, does anyone doubt that the site’s usership would dwarf Facebook’s?  A digitized, 3-D hotty who responds obligingly to a guy’s every command could conceivably earn enough in royalties to become richer, even, than Zuckerberg. And the men lusting after her, more than merely being mesmerized, would cease to report to work.  However, we somehow doubt that the purveyor of such lascivious fare would be hailed as a genius — other, perhaps, than by those who think Hugh Hefner is one.

Meanwhile, if Zuckerberg is so smart, how come he hasn’t figured out a way to monetize a billion-and-half eyeballs?  At present, Facebook’s profits are only a tenth of Google’s.  More to the point, at least where investors are concerned, profits seem unlikely to grow significantly unless Facebook gets in users’ faces far more aggressively. This implies intruding on their privacy and selling their “information” in ways even more appalling than those that are already troubling civil libertarians. Users will become appalled too if and when Facebook is legally forced to disclose the nature and extent of the personal data it has been collecting on them and selling to who-knows-whom. On the day that  law is enacted, we can imagine Facebook shares losing 30% of their value. Until then, however, we may as well resign ourselves to the orgy of greed and hubris that is being whipped up by the Masters and a fawning press to send Facebook’s IPO into the financial stratosphere later this year. Click here to read about out how Facebook uses your data.

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Comments on this entry are closed.

Chris T. February 8, 2012, 7:24 pm

“oops” should have written “The Bourne Trilogy” instead of the Clancy in the above comment.

Chris T. February 8, 2012, 7:23 pm

Cam:
“… doubts about the true nature of Facebook, Linkedin, Twitter and the like and where and how that treasure trove of information with all its “associations” might be leading…”

My belated reply:
When the media reported about the British couple being deported for making “threats” against the US, and supposedly “digging-up” Marilyn Monroe, the focus was only on:
how silly, and why would Homeland Security believe that?

But the main point I didn’t see:
The couple had tweeted only shortly before departing, yet HS was waiting for them the moment they stepped off the plane.
Those word-search algorithms, etc their computers use, most certainly far more effficient and potent now than anything seen in “Clear and Present Danger”, had them fingered in no time against the all-fliers list.

That is where social media is at, not headed towards, and compared to that, the private/commercial uses, as appalling as they are, are just small-fry.

Welcome to the UPoliceSA.

Norman Hechtkoff February 8, 2012, 5:58 pm

http://blog.ecommercebytes.com/cgi-bin/blog/blog.pl?/pl/2012/2/1328580357.html
Etsy is an internet market place designed to sell items made by the sellers. Or if they have changed that at least hand made. As A long time ebay seller i can attest that Ebay was destroyed in great part because they went public and had to answer to “Wall Street” And shareholders. I love the part where they have to do something for the venture capitalists who invested. The people in charge are getting tight pants or wet looking at Facebook. Going public will destroy much of ecommerce.

D. Barber February 8, 2012, 4:02 pm

Also read from David Galland of Casey Research that Homeland Security is now cutting deals with corporations to gather info on you that cannot be obtained legally by other means.

Robert February 8, 2012, 6:11 pm

I read that as well…

Here is the link:

http://www.caseyresearch.com/cdd/zeitgeist-zealotry

and the blurb By David Galland:

“I recently had the opportunity to speak with an acquaintance of mine who is a serving police officer, albeit in a small town that will go unnamed in order to protect his identity and possibly his job.

This particular town, like so many others, is now festooned with a modern, oversized Homeland Security Center (formally known as a police and fire station). In response to my question as to how he liked the new digs, he told me that they were quite spacious and even a bit luxurious, complete with automatic lights, water taps and even toilets. He also told me that the building was set up so that, on a moment’s notice, an entire emergency federal task force could be moved in, plugged in, and ready to operate.

Further on in the conversation, he let it be known that the police department in this rural town, a place where anything more than the most minor of crimes is virtually unknown, will soon have its squad cars outfitted with special equipment allowing its officers to pull up next to a bank, school, or any number of other buildings and wirelessly tap into the security camera system to observe what’s going on.

It was at that point that I couldn’t help but comment, “You know, all of these sort of things are a bit concerning to the average citizen, wouldn’t you agree?”

To which he nodded in agreement, before adding, “Personally, I’m a lot more worried about the corporations.”

I like this guy, but that comment crossed a personal line with me, and so I said, somewhat stridently, “Seriously? Listen, unlike the government, which can force you to do things that you don’t want to do – under penalty of jail or worse – corporations can’t force you to do anything. In fact, they have to treat you right in order to earn your business.”

In response, he waved his hands to break into my modestly indignant diatribe and proceeded to clarify his position – tellingly, in a lowered voice. What he said caught me by surprise.

“No, you don’t understand. That’s not what I’m talking about. What I’m talking about are the corporations that are now working with us. You see, it’s illegal for the government to keep certain kinds of data on the public without a court order. That’s not the case for the corporations. Get it? Technically, we don’t keep the data, the corporations do, we just access it. That’s what worries me.”

Before the conversation could go any further, we were called to our respective responsibilities and so left it at that.”

Cam Fitzgerald February 8, 2012, 7:15 pm

That should not surprise any of us, Barber. Corporations have long been the blunt tool of government policy. That is where the expertise lies and the bureaucracy knows it. That is where talent and skill come together under existing organized structures that can be directed with the least effort and the smallest amount of leverage. Money is always involved.

Taking the worst example from history, we do know the extent to which Nazi Germany employed its various companies in the effort to extinguish people in a mechanized fashion. Everyone from auto makers to railroads and chemical companies became fully engaged in what was one of the greatest tragedies of the century. And of course, everyone who was employed by one of those companies was “just” an employee taking orders and doing their job. Nobody accepted any responsibility. That is just how business is done in extreme times.

Why should we think that anything will change in the future given the relationships between state and corporate bodies? Are business not subject to government regulation? Do they not respond to appease when their income is threatened? I am certainly not suggesting a repeat of the past though. Rather I am pointing to how government agendas are often carried out beyond the offices of government itself and I am saying we should be wary of invitations to offer private information to certain companies. Especially those whose business model specifically cites that it is selling data!!

Facebooking is the realm for damn fools in my opinion. It is irresistible, even addictive to some and there is often social pressures to be engaged by the potential hazards it poses in the unknown future are untold.

Simple step in avoidance of data collection are to refuse to respond to vendor requests, not participate in surveys, never filling out contest forms that ask for e-mails or details of your life, refusing to shop online or respond to anonymous messages sent to your inbox. If you need to shop then do it in person so you know who you are dealing with.

The internet has become really problematic though and some of you will already be aware that you are being monitored without your knowledge or explicit consent. There is one popular un-named program that I feel certain is little more that a piece of glorified spyware but I can’t seem to get the damn thing out of my machine. (You all have a copy of it installed on your computers too so don’t relax yet.)

Avoiding privacy invasions therefore means doing much more than just “not participating” in the obvious data collection processes. It requires active vigilance and a proactive approach to guarding your personal life. And government is not your real worry. Not directly anyway. The really insidious threat comes when you voluntarily give away your rights to privacy to corporate interests or other private companies.

You then have no control whatsoever in how or where that data might finally be used. User beware.

D. Barber February 8, 2012, 3:54 pm

I found facebook to be some sort of psychological support group. Yer suppose to pat people on the back at every opportunity.
My daughter, 29, had me blacklisted in short order and she has 250 active ‘friends’ 50 of whom are probably predators. Younger generation can’t distinguish advice from criticism, and criticism is NOT ALLOWED on facebook. lol
Meanwhile, Firefox with Ghostery shows 8 or 10 sites like facebook, twitter, google this and that, yahoo, disqus… attempting to track every move I make on the internet and requesting to connect with each other to share info.

Paul February 8, 2012, 7:05 am

Trading can be done to snatch a $100 fiat dollar move in gold in both directions from the $1750 level. But keep in mind you are risking “real money” to obtain a few additional “fiat dollars”.

For example … say you buy one ounce of gold now at $1750 and sell your “real money” on a rise to $1850 fiat dollars.

Based on the assumption that the banksters can keep the system going long enough for a correction in gold to take place you can hopefully “complete the trade” by buying back your “real money” when gold eventually falls to $1650 fiat dollars .

After this round trip trade you are left with one ounce of gold again and an additional $200 fiat dollars.

However after taxes and commissions you are probably looking at about a $100 fiat dollar profit for all your efforts.

On a risk reward basis … you risk the loss of $1750 in “real money” (if the banksters Ponzi scheme goes down in the middle of your trade) to obtain that additional $100 dollars in “fiat money”.

Some may say such risk/reward is acceptable because a banking holiday is so far off in the future that they have confidence to “even leverage their trade” to obtain a higher return … others may feel otherwise as the five major US Banks are bankrupt “right now” and the whole Ponzi system could go down without warning at any time …

So when trading your “real money” to make some additional “fiat money” … prudence suggests you don’t do it with “a significant portion” of your real gold savings.

With Bernanke printing fiat hand-over-fist to bail out his bankrupt bankster buddies … a simple “buy and hold gold” strategy can be very powerful … as it “keeps you safe” even if Bernanke’s printing is successful in keeping the banks alive (creating inflation) and “keeps you safe” if Bernanke’s printing efforts fail … and the whole fiat system comes down.

Robert February 8, 2012, 3:44 pm

Paul-

But, but, but……

US Dollars ARE real money. As long as they are accepted everywhere, there is no reason to assume that a crash is coming, right?

Ok, so maybe they DO only buy as much as 4 pennies did in 1913, but that’s just because the world has a “more complex” economy today than it did back then…

I’ve rehearsed this sound bite so much you might actually think I really WAS a devout Federal Reserve System lackey….

What was Mark’s earlier point about hiding in plain sight?

Paul makes a very good point about the risk factor involved in trading gold – the kind of leverage you have to maintain in order to generate miniscule profits elaborates the very nature of risk when the scale of the price relationship is reversed….

I agree with Rick Ackerman’s premise that paper cash will still maintain purchasing power in the event of a global banking crisis.

All forms of paper “liquidity sinks” (bonds, t-Bills, CD’s, and yes, even high P/E stock portfolios) could evaporate in a very nasty chain reaction; but the following morning, when the ATM’s are not working, and the debit card scanners in the local stores are all reading “error”, people will probably accept greenbacks in trade for items (epecially perishables) that they happen to have in surplus…

And gold? My opinion is that gold would STILL not go into circulation… gold would be what it has been for eons- savings and wealth preservation. The banks and the “new” treasury facilities that would have to begin coordinating a new global currency network will have to have SOMETHING to issue their circulating notes against… since the whole “faith” thing will be treated as highly suspect by a wearly population….

Rusty February 8, 2012, 5:34 am

Good point, Mark. Also, parents should definitely join if their children are on there. Those who do not keep up with what their children are posting on FB will likely be more than a little shocked to see little Sally posing that special big-girl way — with that revolting Mohammed blighter from down the street!

Mark Uzick February 8, 2012, 2:29 am

I read Rick’s link and I come away with a different interpretation of how to deal with the threats to privacy.

Hasn’t it occurred to anyone that keeping off the social radar could be interpreted by snoops as you’re having a high probability of trying to hide something or that you are a risk for being someone who engages in clandestine or unsavory behavior? or that you’re anti-social?

Wouldn’t ‘being out there in public view’, but using discretion about what you reveal, be a more effective tool to avoid potential trouble? kind of like ‘hiding in plain sight’.

Avoiding social media would be analogous to attempting to protect your credit rating by avoiding credit cards and other forms of credit; it not only doesn’t work, it counts against you.

Rich February 8, 2012, 1:28 am

Aloha All

Thought the GOOG Dutch AuctionIPO at 85 was overpriced too. Boy was I wrong.

Since FB IPO is mostly a secondary “handled” by Wall Street, will say:

“Heigh 0 Silver.”

“Up up and away”…

(Click on name for silver details)…

Mahalo

Robert February 7, 2012, 11:35 pm

“efficient, interesting and socially propsereous primate ”

– This entire commentary was worth reading expressly for the chuckle the passage above brought with it…

Regarding Facebook, especially as it pertains to the comparison with Google, there is one important differentiator:

Google is really nothing but the world’s largest, and most efficient library card-catalog. It is like a giant will-call warehouse that uses some REALLY fast forklifts.

Facebook, and also Twitter, are more than social interaction tools – They are BEHAVIOR repositories. What you post to Facebook gets taken away from you forever: You surrender your ownership of your own activities.

When a person uses a social networking site to “interact” with friends, what they are also doing is characterizing and storing their behaviors, personal preferences, and tastes… And, they are not storing them for their own future use or recollection. Most people think that what they did yesterday is “in the past”, but with the data recorded and stored by Facebook, this data can be recalled and shared at exactly the most inopportune future moment in the interest of maximizing embarrassment, or humility for the individual.

They say “What happens in Vegas, stays in Vegas”; but the reality is that “What happens in Vegas, and gets posted to Facebook, becomes the property of any potential future political majority on Planet Earth”

So, the more the “socially preposterous primate” tries to demonstrate and enforce their dominant individuality, what they are actually doing is selling this cherished individuality and self identity down the river… for free.

So, why is the price of gold rising again? Doesn’t everyone know that NOBODY on Facebook is buying Gold?

Think about that one a good, long time…

Benjamin February 8, 2012, 12:27 am

Well, according to the link that Rick posted (which I didn’t see until he pointed it out in another post), it isn’t just facebook and twitter. Data mining is also done on emails and even search engine querries.

And it isn’t just what you, personally, do. You become guilty by association with others who have similarities to you (however insignificant).

“So, why is the price of gold rising again? Doesn’t everyone know that NOBODY on Facebook is buying Gold?”

Eh? Are you being funny or serious, Robert? I know it’s a dumb question. You can’t possibly know that! But I’m not sure what you’re saying, here, and I don’t like jokes I don’t get 🙂

Cam Fitzgerald February 8, 2012, 1:05 am

Exactly Benjamin. Guilt by association. It is the oldest tool in the book. It does not even matter if you are innocent when your friends are found to have done wrong. The Italians have an old saying….

It begins with the words “tell me who your friends are…….”

Robert February 8, 2012, 1:17 am

Benjamin-

ok, my deliberately shadowy inference regarding the Gold market may have been a bit too obscure-

My point was that the gold bull market will not breath its last until people are posting on Facebook about how the coins they purchased last week have doubled in price, and how this week they are taking every last penny they inherited from their late uncle George and dumping it into the PHYS ETF…

And of course, they will be oblivious to the fact that it is a really bad idea to share this data with friends, or with the government…

roger erickson February 7, 2012, 10:05 pm

Facebook’s model does seem to be doomed.

Google simply indexes any/all registered web addresses, for mapping by advertisers. It’s useful service is in working hard to lower the real net cost of that indexing/mapping service. Their lead in designing/making/improving better/faster/cheaper server-farms is indeed wildly impressive.
It’s a technology race from there, and Google has a sizable moat that no others have approached yet.

Facebook attempts to circumvent that with methods for attracting users to a private web-hosting service. There seems little barrier for linking independently hosted urls through open-source links. They’ve poached Google staff to try to play technology catch-up, but good luck there.

Interdependencies are always free in an organized system. Organizing them for group productivity is hard. Navigating them for valid system-maintenance service – or for parasites – is a fairly trivial task.

nonplused February 7, 2012, 8:46 pm

My wife disabled her Facebook page and I might too. I used to see it as a way to make contact with long lost friends, but unfortunately the few I have actually made contact with send me messages I don’t see for days, due to infrequent check-ins.

Facebook, like Yahoo, AOL, and countless other on-line fads that have come and gone, is just one twist away from becoming yesterday’s news, just like any other technology company. In technology today, you have to be “cool” to be on top, and cool only lasts so long.

Companies like Google, Microsoft, and Apple probably have more staying power because they have defined monopolies. (Google in advertizing, Microsoft with Windows and Office in the corporate space, and Apple in the consumer space.) Of the 3, I think Apple has the weakest monopoly and the Android platform is the next cool thing. But the young people I talk to are still very loyal to Apple, seeing the Android as the phone for “geeks”. How long that lasts I do not know but my leading indicator, which is my wife, switched to Samsung when Apple dropped the 4s instead of a new 5. The 4s just wasn’t good enough to drop $200 on in her mind. So far she loves her new Galaxy. The big screen impresses me.

I personally am stuck on Blackberry because that’s what my employer puts in my pocket, and you know what, it’s a decent phone. It’s got the touch screen and all that, but I actually like the mechanical keyboard it also has better. But does anybody believe the mechanical keyboard is going to make a comeback with the younger crowd?

RIM still has a lot of clients. Maybe Facebook always will too. But sooner or later the “growth” will move elsewhere.

Mark Uzick February 8, 2012, 1:52 am

nonplused: “I used to see it as a way to make contact with long lost friends, but unfortunately the few I have actually made contact with send me messages I don’t see for days, due to infrequent check-ins.”

Does that mean that you don’t check your e-mail frequently either? I get an annoying amount of invitation and friend requests as well as messages sent to my e-mail which I mostly ignore, unless I both recognize and have some interest in the the sender.

BigTom February 7, 2012, 8:35 pm

Rick – short and to the point – well said….could not agree with you more on the whole sordid affair……

Gary Tealot February 7, 2012, 8:19 pm

Sorry you live in Russia, 1936. I don’t. Note: Cam and I are best friends. OK, now you and I are linked forever!! 🙂 You can live in fear, or not. But please only use cash, never shop anywhere with cameras, never watch tv, use the internet, or do anything outside of the cave. Let others live and enjoy their only life. They made billions, and we didn’t. I’m not jealous. Good for them. They are laughing all the way to the bank.

Cam Fitzgerald February 7, 2012, 8:49 pm

If anyone really thinks that the array of potential financial outcomes in our future might lead to free popsicles, canycanes and Unicorns for all then they need to wake up from the slumber now.

Big political shifts in thinking and behaviour can happen during times of turmoil, financial discord and when war is in the wind. Sabre rattling over Iran may not be a real concern but the headwinds in the economy certainly are and we do not yet know the true extent of the damage that will be wrought to correct our profligacy of the past.

You don’t even need to make this stuff up. History itself offers ample evidence and proofs of why you should never let your guard down when it comes to personal privacy.

But go ahead Gary. Get all jiggy and complacent. The funny thing about the future is that nobody yet knows what it will bring or how it might affect the lives of everyone around you.

Therefore, I defriend you. (no offence intended).

Gary Tealot February 7, 2012, 7:41 pm

Facebook connects the opposite sex. This is critical. A girl you liked in HS, or college, or whenever. It’s also a metric to see if your “friends” are successful. This site creates emotions. Priceless. And it’s free. Economic value via 80% gross margins in semiconductor chips while enslaving chinese isn’t some great company either. Facebook creates groups of people, and adds more to the human experience than say someone trying to sell you a used car. Would you trade in your wife for a car? Of course not. Now you see the value.

Cam Fitzgerald February 7, 2012, 8:06 pm

Facebook is the single greatest threat to your privacy that has ever been conceived, Gary, and I can almost guarantee that when the next negative mood in society comes there will be plenty of defriending and running for the hills as all the damn fools realize what a mistake they made by publicizing and promoting every sad little aspect of thier lives for the whole world to see and interpret.

Computers never forget (even if you do) while data mining is very impersonal, even clinical in nature. You do not even need to be guilty of anything to end up on watch lists in the future. Judgements are made based on who you associate with and that is sufficient to bring you to the attention of whatever authority is in our unknown future.

Larry D February 7, 2012, 8:24 pm

“Would you trade your wife for a car?”
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*END STOP*

Mario cavolo February 7, 2012, 6:36 pm

Meanwhile the inexplicable short squeeze from hell in gold, crude and natural gas has made it a fascinating evening…as if the smart money knows exactly how to ruin my acct… I don’t suspect even Rick with his very reasonable recent guidance to wait for a drop to 17o2 on gold expected a one hour rocket ride to 1740 plus…! Evil lurks…

Cam Fitzgerald February 7, 2012, 7:39 pm

Well the buck turned out to be a bust Mario and dropped to seventy eight and a half right out of the damn blue pushing gold back up. No conspiracy, just the forex guys and the bats working in the wee hours to make Tuesday more interesting.

Rick Ackerman February 7, 2012, 9:52 pm

I don’t have a crystal ball, Mario, but “surprise” is never applicable to technical forecasting, which is always going to be conditional. Here is Tuesday’s tout for April Gold (sent out last night), along with an update I put out about 20 minutes ago:

“Gold’s downtrend stalled yesterday between two minor, bearish Hidden Pivots, but not before the June contract had taken out three more external lows. This is discouraging action for the near term, and it suggests the 1702.00 target given here earlier remains a good place to look for a tradable low. Alternatively, we can set the bar at 1747.50 (see inset) today to signal a meaningful resurgence of bulls. ______ UPDATE (2:33 p.m. EST): The April contract has rallied nearly $40 from this morning’s fake-out low, creating a bullish impulse leg on the hourly chart. Now, assuming 1752.60 holds as ‘B’ of the current impulse leg, Gold will need to pull back by at least $12.50 (0.625 of $20 k-A segment) to be considered fully re-charged for a C-D follow-through leg of as much as $40.”

Bradley February 7, 2012, 5:40 pm

Yeah, companies that specialize in pandering to our worst instincts, which are centered around ideas and products which do nothing to nourish our bodies or souls–man they’re all going straight to hell.
I’m shorting MCD and MO right now!

Benjamin February 7, 2012, 6:55 pm

Is it true, Bradley, that you’ve stopped being sarcastic with your wife? Anyway, the point isn’t whether or not Facebook provides a service which enough people value, or if that valued service is moral or not. It’s that it’s almost like the fate of the economy hinges on something which produces nothing tangible while consuming time and (cyber)space. If it wasn’t so obscene, it would be insane.

Bradley February 8, 2012, 1:01 am

sez Benjamin “It’s that it’s almost like the fate of the economy hinges on something which produces nothing tangible while consuming time and (cyber)space”…
jees, I’d bet most would have said about the same thing about the the possibilities for the telephone, the arpanet, junk food, cigarettes, sugary drinks, music, movies, digital anything. “What POSSIBLE good could any of those things be?”
The proof is in the pudding, and so far, more people are using Facebook than eating pudding, so I’d bet on the former. This is, after all, a website dedicated to investing, is it not? I guess finding companies which “provide a service which…people value” is out of fashion here…only OUR opinions matter!

Larry D February 7, 2012, 5:39 pm

“…Lionel Tiger…saw Facebook’s inventor as “bestrid[ing] vast business numbers once dreamt of only by toothpaste and soft-drink makers…”

Or toilet paper manufacturers, Professor.

Bernie February 7, 2012, 5:28 pm

What a diatribe dripping with envy. What concerns? Nobody is obliged to subscribe to FB. If you do, you know what the consequences are.

&&&&&

Drip this, Bernie: Most of Facebook’s hundreds of millions of users are undoubtedly ignorant of the consequences. That’s why I added a link at bottom to a NYT story that spells out just how insidiously users are tracked. The abuses of privacy are… I’ll stick with the word “appalling.”
RA

Mark Uzick February 7, 2012, 5:51 pm

I can see how you might jump to that conclusion, but those who’ve been around awhile know that Rick can go overboard in his criticism of a company, (but in a very entertaining way!) his disdain is primarily directed at any public offering that looks like an over priced, over hyped way to fleece naive investors. He’s just doing his job in his an entertaining style; investment education is his profession after all.

Cam Fitzgerald February 8, 2012, 12:53 am

Thanks for adding that article from The Times of India, Rick. It further bolsters my many doubts concerning risks of using social network sites while adding another layer of reasons to avoid them, if possible. If there ever existed a set of reasons for password protection on your laptop then this is it……..and never let the kids or your buddies use your machine.

good

TM February 8, 2012, 4:39 am

The last defense of the clueless is consistently the charge in this accusation. Do not mistake disgust of FB as jealousy.

Franco Mazzuca February 7, 2012, 5:22 pm

Facebook is a great communication and group organizational tool. Not unlike the telephone when it first came out and before then the post office and letter writing. Unfortunately there are a lot tools like that on the web. Once Facebook has a dominant position, it may be able to capitalize on the value its users have perceieved. Time will tell.

Gordon C February 7, 2012, 5:10 pm

My dog is on Facebook. She does have trouble typing, but she is working on it.

Mark Uzick February 7, 2012, 5:29 pm

You missed an opportunity: This would have been funny if it was a reply to Benjamin’s post where he equates FB’ers to pets.

gary leibowitz February 7, 2012, 5:01 pm

This is a turd as far as investing goes. Their valuations will never pan out, EVER. If interested to learn why look into Reggie Middletons articles. He was the first to expose the banks problems and why he considered it a “black hole” for shorting many years ago. He explained why Blackberry would lose to a donimante Andriod system. He has been doing financial forensics years before the problem surfaced.

http://boombustblog.com/blog/item/5995-the-webs-first-phenomonally-forensic-facebook-analysis-this-is-what-you-need-before-you-invest

George February 7, 2012, 4:41 pm

FACEBOOK is the Trojan Horse of the 21st Century.
easyEE is right on that its early fascination and curiosity of connecting with people is fast becoming stale. I really don’t give a shit what you ate for breakfast. FACEBOOK’s growth will be more in Asia and the developing countries as a means of cheap communication. Gaming remains a popular draw for many. Aside from that….

Larry February 7, 2012, 4:05 pm

Extraordinarily insightful.

John Jay February 7, 2012, 3:25 pm

It is all part of the bulk of the US populations descent into fantasyland. Pro sports, Lady Gaga, housing boom, prolific drug use, vampire movies, Comic book conventions, on and on it goes.
My 68 year old Opthamologist told me he tried to get his son into medical school, but he was not interested. So his son is now 38 and spends his time in virtual video gameland. As far as a Facebook IPO goes, the stock market has been fleecing rubes for a long time. Remember all the dot com stocks going parabolic for years? When you are dealing with momentum it’s best to check your brain at the door and just ask yourself what is the market doing? Going up buy, going down, sell. Very little of what goes on in this world makes any sense if you try and use logic. All you can do is react as fast as you can to changing circumstances.

Rob T February 7, 2012, 8:55 pm

The flip side to your ophthalmologist’s conundrum is the bevvy of med students with hairdresser mothers with whom I’m acquainted. Virtual time wasters may just be new mechanisms to facilitate class mobility.

Benjamin February 7, 2012, 11:23 am

“This reflects a new commercial demography in which the consumer is not someone who wants something necesssary, but rather one who seeks to assert simply what he is.”

We already have those. They’re called pets.

But seriously it is necessary! It sells computers, doesn’t it? And computers have to be made, don’t they? And in order to sell computers like Facebooks (hotcakes are sooo yesterday), we have to sell consumer debt like computers, right?

Of course. ‘Cause if we don’t, we’ll be turning our backs on the future, that place where our economy always, importantly, seems to be. Never forget that!

Mark Uzick February 7, 2012, 11:18 am

In a sad way, Rick may have stumbled upon something:

Rick: “If someone were to offer a porn site that allowed men to have their way, virtually speaking, with the Hollywood babe of their choice, does anyone doubt that the site’s usership would dwarf Facebook’s?”

Facebook’s model is based on social interaction between real people, where Google’s model is based partially on a pretend form of social interaction in the form of pornography searches. On this basis, shouldn’t we be rooting for Facebook’s dominance over Google?

What does our agreement with Rick’s prediction tell us about our opinion of modern society?

BTW: Isn’t this forum a form of social interaction? Does it produce nothing or is it possible that there are things of value which may be produced, like education or friendship, that are not things made in a factory?

Benjamin February 7, 2012, 12:07 pm

“Facebook’s model is based on social interaction between real people, where Google’s model is based partially on a pretend form of social interaction in the form of pornography searches. On this basis, shouldn’t we be rooting for Facebook’s dominance over Google?”

Assuming that Google and FB are used for different purposes pretty much leads the questioner to one answer. But the two are not entirely dissimilar, regarding interactions. So the question isn’t really one of rooting for either, but rather what one chooses for ones self. I come here to this particular forum because the people are generally civilized and insightful. But if it were to become like the Reason.com comment sections, I’d neither post to nor read from it.

mario cavolo February 7, 2012, 12:08 pm

Google, well perhaps I should say “search on the web” which google now dominates, is the greatest thing since hotdogs and apple pie… whatever I need, whatever I want, whatever anyone asks me, whatever I need to quickly research, confirm or deny, whether its a business topic, or plan or, insightful thoughts, more recently a 5 year old’s english lessons to help a friend….its at my fingertips worldwide…that’s freakin’ amazing and wonderful!!

Meanwhile, I’m happy to say I never was enamored with facebook in the first place, I’m too busy, linked in is very useful and polished as a professional/business connection platform and I’m very glad I have my linked in page which I know is often checked out and links to my other business web pages…

Cheers, Mario
Mario

Mark Uzick February 7, 2012, 5:04 pm

mario: I agree with everything you just said, though I wonder if my own lack of enthusiasm for FB might not really be a reflection of my age and the fact that I never had much interest in collecting hordes of friends.

As FB is a social network, as opposed to a professional network or a special interest forum such as this one, its content reflects on society – especially the younger people – so wouldn’t criticism of it imply more of a disappointment with popular social values than the FB platform itself?

I’ve gotten some good value from FB, although I spend little time there: I’ve viewed photos of family and friends; I’ve been contacted by cousins I’ve never met who were curious about me – an easy thing to do, as my last name’s so uncommon -; I’ve recently taken up e-mail correspondence with an old friend living in Singapore, who found me through FB, whom I haven’t heard from in over 15 years.

As far as concerns about collecting data go, as commerce is a two way street, this ‘dossier’ on members doesn’t merely serve businesses, but it helps them to target our needs and preferences. While it could be put to use by sinister powers, anyone who has the ambition to become important enough to be made a target will most likely be discreet about revealing things that he may care to keep secret.

mario cavolo February 7, 2012, 5:21 pm

🙂 Remember Prodigy?…about 20 years ago my senior year high school sweetheart sent me an email through that platform…what a thrill!..

Mark Uzick February 7, 2012, 5:23 pm

Benjamin: “So the question isn’t really one of rooting for either, but rather what one chooses for ones self. I come here to this particular forum because the people are generally civilized and insightful. But if it were to become like the Reason.com comment sections, I’d neither post to nor read from it.”

My comment was in response to Rick’s essay; I personally root for them both. Google is already a marvelous wonder; and, while FB is of much lesser relevance to my life, who can predict what wonders may evolve from it or some similar company? (…not that I would invest in it…)

I love Reason Magazine – I get the printed version – but I avoid the on-line comments section; it needs moderation.

ricecake February 8, 2012, 12:00 am

Totally agree Mario Mario 200%.

Google becomes my walker (or my be I’m an idiot.) I can’t live without Google these days. For example, at work whenever I forget something: information, data, and spelling of an English world, I just simple Google it and you get it right there in a second. It’s just simply freaking amazing! Say if you want to know about “Whipple procedure”, Google it and then Youtube it. You’ll learn and know in NO time.

Do I want to know about the birthday wish of so call “Friends,” (whom most of time are no friend(s) of mine, or they are bunch of people you don’t even know) ???

The answer is – HELL, NO NO NO!!!!!!!!!

Do I want to hear from them day in day out and worst many time of a day?

The answer is HELLO? NO NO NO!!!!!!!!!! If I do have the time, I don’t have the patience or the tolerance.

😉

I would rather spend some time on Youtube to watch some videos of useful and entertaining. Or read a book.

easyEE February 7, 2012, 10:30 am

The facebook, a fascinating phenomena. I observed it in myself, I was a bit hooked on it at first. Not in a ridiculous way, but I’d log on almost every day to check it out. From my circle of 50 friends there would usually be some witty comment or picture of interest so it was alright. I also got started with it because of a woman, so you can see how that would factor into it. Anyway, the woman is gone, I haven’t de-friended her, and the facebook account is still there. Not as active for me as it used to be. Maybe once a week if that? For many of my 50 friends, the same. I’m in my 50’s, but half of my 50 are in their late 30’s and they also appear to be tiring of it. I can tell, as the posts and comments are not as witty and well thought out as they used to be. The fad is passing, at least for me and my lot. I think what will happen with facebook is that part of the world or populace will resonate with it for a spell, and then tune out. The facebook is an emotional experience, and humans get bored of same ways that fire their emotion.. I think facebook will be very challenged to keep the emotion flame alive to ensure long term, loyal customers. Google’s advantage is they have a practical purpose that is always pervasive. Emotion is fleeting.

Mark Uzick February 7, 2012, 11:28 am

Your experience is a very good illustration of the principle of ‘reversion to the mean’. In this case, after an initial infatuation with a new tool, a normal balance between personal responsibilities and social interaction was resumed.

Carol February 7, 2012, 3:43 pm

Worst, FB will not allow you to delete your page so once you have one you always have one. So their huge “eyeball” or “users” numbers are really meaningless. If they allowed users who tire of this fad to actually delete themselves the numbers would be far different.

Cam Fitzgerald February 7, 2012, 7:30 pm

I did not know that Carol. That fortifys my doubts about the organization and its data collection motives.

What possible explanation could be given to deny a person the right to permanently extinguish their account? Makes me all the happier I never signed up despite the lure of all the “friending” requests. Some of them were out and out suspicious anyway.

I am sure everyone has received those and thought “what the hell is going on here anyway?” or “who is this from?”.

On the other hand, if you needed to be in the know you could not have dreamed up a better method to find out who a certain individual might be associated with and therefore a means to categorize them into political camps or social classes.

Maybe Zuckerberg has earned the big bugs and rewards for bringing the ultimate tool of discovery to a future totalitarian regime. Who the hell knows. He has got to know what a can of worms his project is going to be in the long run and how much damage it might cause.

Imagine if Facebook had existed during the Second World War or Vietnam. What if it was around during prohibition? What if it was a tool being used during the McCarthy era or for tracking suspects in the Black movements in the 60’s?

Of course, the war on terror and the war on drugs continue and many would support social networking sites being used as tools to nail down the bad guys. But there have been times in the past where governments clearly took a turn in the wrong direction even though we only really appreciate this in context many, many years after the fact.

Social networks are all fine and dandy as long as times are good but God help you the day the mood of the nation changes, a real war starts or one of your so-called “friends” is caught up doing something serious or even illegal.

Go ahead, explain that friend away now.

AnonyMoose February 7, 2012, 8:29 pm

FYI there is a javascript wallcrusher that will go through and delete all of your wall posts:

https://github.com/grekker/Facebook-Wallcrusher

Very easy to use, just bookmark the JavaScript and activate it when browsed to your wall. I recently got rid of eight years of facebook posts, but of course who know what they keep in “backup copies”

FB even has a feature where you can download a zip file of all of your posts, pictures, videos, etc. Snag that before you wipe your wall!

Cam Fitzgerald February 7, 2012, 8:51 am

Well said, Rick. A great many of us have more than just fleeting doubts about the true nature of Facebook, Linkedin, Twitter and the like and where and how that treasure trove of information with all its “associations” might be leading those whose business it is too watch the herd.

With the advent of truly cheap storage costs and new analytical capabilities of supercomputers the moment will surely arrive when all will be indexed and filed discreetly under our personal names along with our various paper records of taxes paid, drivers data, vital statistics and credit data.

One big fat file, just waiting to be harvested.

One treasure trove of data too. And the sheep are foolish enough to not understand for the most part that as they participate they simply gift all their most personal details to the data miners of the future.

The questions we might ask are “who will benefit most” and “why would the data ever get centralized in the first place”?

We do not doubt for a moment though that the outcome of wide public participation in a wild West of unrestricted internet connectivity and electronic socialization with few checks and balances for government agencies and corporate interests will truly benefit the gifters of all the data.

Sometimes I am really happy I was born too late to ever be a part of this mad new world where every fart is a reason to tweet your college drinking buddies and is also a reason to perhaps have a regret when you discover belatedly that all the details of your evening fart-fest were recorded and saved for public posterity some rainy day down the road.



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