Facebook: Smells Like Enron
Perhaps we are now witnessing the only thing that has made any sense throughout this entire sad episode. It not only teaches Wall Street an important lesson in humility, but it also reminds investors that there is no such thing as a sure thing, or that "what you see" can be a façade, absent a considerable amount of due diligence.
As Enron exploited a base of greedy and unsuspecting investors, Facebook's popularity, unlike most stocks, also presented an easily exploitable base of naive investors. This group believes that a great idea not only should be a great investment, but that fundamentals and valuation don't matter. However, a Facebook-Nasdaq act will ensure that everyone's interest is served and greed does not ever precede sound logic.
At the time of publication, the author was long FB and held no positions in any of the stocks mentioned, although positions may change at any time.
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