Will someone explain this to me please (Maria Bartiromo ) :

[G+_George Kozi]

Originally shared by George Kozi

 

Will someone explain this to me please... (Maria Bartiromo ) :

 

The stock price of Twitter, who hasn't yet figured out how to make money (if they ever will), jumps from 26$ to 45$ on the first day, and the stocks of companies that rake in many BILLIONS each quarter, like Microsoft, yes microsoft, is going down. Something is really funky about this.

[G+_Andrew Wilson]

Over exuberance by a people and organisations who will wish they left well alone this time next week.

[G+_Christopher Young]

Because the investors think Twitter will be profitable in the future and Microsoft will not. Only history will tell if they're right. I'm staying on the sidelines of this one.

[G+_Joe Morrison]

Investors are betting on the future stock price, not future profits other than possibly hoping that profitability will bring dividends.  The banks putting the deal together are making out like bandits while everyone else takes it in the shorts.

[G+_Billy Vaughn]

That's exactly why it's a scam. Companies are not valued based on their profitability or ability to make a great product. It's what's hot and what buzz is being created. Apple's in the same boat. Has more money and makes more money all the time but " They can't innovate" is all you hear from the analysts. Stock price goes down.  

[G+_Dave Trautman]

Those of us who watched in horror during the dot-com bubble of the late 90s can only shake our collective heads and wonder how many more will be fooled.

 

Stock market activity is gambling plain and simple. Whoever is hot or whatever is 'trending' gets the attention and later the seller goes looking for the sucker to take his bet off his hands. Ignore all we've learned about IPO events in the past. "This one is different..." is all we hear.

 

Seeking to make sense out of trader activity and investment "analysis" is a fool's game. When something this juicy (the Twitter thing) gets telegraphed for months in advance it puts people in a great position to feed on the excitement and then feast on the short sellling. It matters not whether any investment actually makes something or has profit potential. The original owners of the offering will not be holding for the long term. They are there to pump up the price so they can get a second profit when it falls back to earth. Holding Twitter stock for more than the minimum required time is crazy talk. But talking up the potential is everyone's game right now.

 

Twitter itself, the company, the people, the innovation, and the massive online membership, have absolutely nothing to do with what the price of the stock is for the next month. After the required hold time expires these banks and brokers are hoping to have found enough followers to sell down into and harvest their short term gains. Then it's on to the next big thing.

 

This relates to Apple because they used to stay away from anything which might attract or entertain financial analysts; until very recently. During the decades – where they ignored the traders – their focus on great products was admired but getting hold of their stock was pretty hard to do. In the past 6 years they've been the darlings of the investment crowd because they started to change their relationship with them. Today those analysts are turning away from Apple and looking for the next big thing. In their minds the bet on Apple is over. There will be no more opportunity for flipping Apple stock. The tech investment market needs a new darling. "Hey, what's this Twitter thing all about?"

[G+_George Kozi]

From the outside and very far away, I think I that can see a fundamental conflict of interest. What the stock market wants, and what a company's best interests should be are not the same thing. That's one aspect of it.

 

The other aspect is that the short term gain always seems to trump the long term strategy... and our economic system is based on this kind of stuff... it's worrying.