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Goldman Sachs Says No Facebook Shares For US Investors
theodp writes "In 2009, Robert Cringely speculated that the day might be coming when Goldman Sachs decides the United States isn't worth dealing with anymore. Crazy, eh? Maybe not. Blaming 'intense media attention,' Goldman Sachs has decided to exclude US investors from a $1.5 billion Facebook offering. In a nicely-timed all-investors-are-not-created-equal MLK Day statement, the US taxpayer bailout beneficiary said, 'Goldman Sachs decided to proceed only with the offer to investors outside the US....We regret the consequences of this decision, but Goldman Sachs believes this is the most prudent path to take.'"
This actually sounds pretty plausible. Remember that Facebook is a company that is valued at more than 50 billion USD, yet pulls in 500 million yearly in revenue. If it turns out that Facebook is a bubble, GS and Zuckerberg might be able to cash out quick before the stock price cashes and burns, and not have to worry about any pesky insider trading or fraud investigations being brought up by the SEC. Remember that the holdings company GS set up for Facebook is registered in a generic foreign island tax haven country.
It kind of looks like the people who could really benefit from an IPO would already have been excluded. Just like always. So, I'm less inclined to be upset about this.
Given Facebook has all the hallmarks of being the next AOL and Mark Zuckerberg the next Steve case, I have a feeling that GS is doing the US a favor.
Maybe it's the opposite. Who knows? Maybe they actually think they woefully overvalued Facebook and decided they only want to screw over the foreigners.
"It is a good thing for an uneducated man to read books of quotations..." -Winston Churchill
And, they probably -are- protecting the public in this case...companies should not be allowed to sell shares to the public without disclosing important information about themselves.
Maybe this is the future growth export industry in the US: securities fraud of foreign nationals.
"It is our blasphemy which has made us great, and will sustain us, and which the gods secretly admire in us." - Zelazny
If it turns out that Facebook is a bubble[...]
If?
I have to wonder -- given their past behavior -- if GS is juggling its various independent business entities so that one entity can offer the IPO while another entity shorts the motherfucking hell out of it. The actual reality would undoubtedly be more complex than the non-gnome population could readily understand, but I wouldn't be surprised if, once all the layers of obfuscation are peeled away, that's what it boils down to.
In any case, Facebook really doesn't have a whole lot of room to grow, and it's ripe to be friendsterized by someone in the next wave of social networks. Live by the social trend, die by the social trend.
Proud member of the Weirdo-American community.
Not confused at all. They owe more than MONEY. You don't get that.
The fed isn't a fucking bank, we had to bail them out because of their own actions, and actions of like banks. What they owe is to move forward in a responsible way so we don't have to bail them out again. They owe the citizens a debt of gratitude. They operate in a free country, they owe it to us to operate ethically. Money isn't the only method for measuring the "quality" of a business. It is also not the only way to measure debt.
Tequila: It's not just for breakfast anymore!
What it is is a scheme to get our taxpayer money which we bailed them out with last years out of the country. They invest in a big bubble once more, this time with their bailout money, invest in it from outside the country using shills (so it can't get scrutinized by the local authorities) and then bust the bubble after transferring out all the cash.
Custom electronics and digital signage for your business: www.evcircuits.com
It wasn't the "European banks" that got hurt from the mortgage-backed bunkum. They were made whole to the tune of 100 cents on the dollar. The people who are paying for it are the same ones that are paying for it over here. You and me. Our parents. Our kids.
They are creating a "breakaway" culture, who within decades will be the only ones with access to capital, to new technologies, to advanced health care. That's the ultimate effect of the dramatic increase in wealth disparity. Fifty years of this and they'll be as far ahead of the rest of us as the American settlers were of the Native Americans. When two cultures exist side-by-side and one is so far in advance of the other, it doesn't work out well for the ones on the bottom. We are seeing evolutionary branching based on wealth alone.
You are welcome on my lawn.
Just because I think that 99.999% of Republican policy is absolute bullshit DOESNT mean I support the democrats on most economic issues. Almost all Republican and most Democratic economic policies have little to no empirical backing. I try to be as empirical as possible, for example I'm one of those people thats for public health care but against extending unemployment benefits. Why? Because public healthcare has been unequivocally proven to be much cheaper for both the individual and society as a whole than private health care. The numbers are there for all to see. However on the flip side extended unemployment does act as a disincentive to return to work, even jobs that people feel are beneath them(for the record, I am pro-unemployment benefits up to 1 year, after that you had better figure something out).
Monstar L