Juggling Dynamite

Facebook was the most over-hyped issue I have seen in the past 20 years. That’s saying something, because new issue pump and dumps are the norm. I have literally witnessed dozens of new issues pass by my desk over the years. Truly, this one was right up there as the gold standard of insanity. Predictably it was over-priced at issue. Predictably those who were suckered in have lost money. And as is human, most are traumatized and reacting badly to the loss.

The truth is that those who thought they were buying into a “hot” issue were not investing, they were speculating. Whether they understood this or not. They were taking sales puff from the distributors as “investment advice”. Most could not afford the risk, and are hurt now by the losses. Even if the stock eventually recovers value over coming months or years, most of the initial buyers will have long bailed with losses rather than waiting for the price to recover. There is another valuable learning opportunity in this story for everyone who is willing to see it.

This article really summarizes the story well. See Facebook IPO costs mom-and-pop investors a bundle, while Wall Street scored big.

I understand that many people are broke and desperate to make a quick buck to beef up their savings.  Desperate people often do desperate things that end up only hurting them more.  It is tragic but typical.  What I don’t understand as easily is why so many intelligent, hard-working, educated, disciplined people, who have actually amassed sizable savings, still go to risk-sellers–banks, brokers, commissioned mutual fund sellers “financial planners” for their investment advice– staying in abusive relationships, even while they frequently leave one for another.  Apparently many people still want to be repeatedly hit by a hammer.  It is an amazing phenomenon to witness.

The Daily Ticker’s Aaron Task interviews William Black about JP Morgan’s massive trading loss and why CEO Jamie Dimon must be replaced with a manager who is not addicted to exploiting federal subsidies ala taxpayers to gamble on financial derivatives.
Here is a direct link.

This documentary is worth considering. It is looooonnnnng (2:12) and far reaching (definitely conspiratorial). It includes many upsetting allegations or assertions. However it is not necessary to accept every proposition in order to see some overall merit.  Many of the ideas are broadly correct or within reason in my view.  I am doubtful that the oppressors or the “they” in the film are as calculated and intentional as the film suggests. I think most of the harmful decisions are and have been made in the human tradition of basic greed and control–coveting resources and power for a few at the expense of the rest. The oppressive collusion between the finance sector and governments over the past 30 years is something that I have personally witnessed and warned about for many years now.

I do think that the world is now entering an important period of revolution and evolution. And there is great opportunity in this. I am convinced that a brighter future will be found ahead more in prevention than treatment, in clean, sustainable, self-suficient energy, and in getting the finance/debt genie back into the bottle. The greatest hurdle to getting there is not science, or a deficit of innovation–but overcoming the oppression and resistance of the current status quo. You can make up your own mind about where you agree and disagree. Depending on one’s world view, some of the ideas in the film are no doubt incredulous. The key is that we think instead of blindly follow. Most importantly, I believe that we must each strive to be the change we wish to see. Suggestions on positive actions individuals can and are taking, starts about 1:35 in the film, in case you want to fast forward to the takeaways.

“THRIVE is an unconventional documentary that lifts the veil on what’s REALLY going on in our world by following the money upstream — uncovering the global consolidation of power in nearly every aspect of our lives. Weaving together breakthroughs in science, consciousness and activism, THRIVE offers real solutions, empowering us with unprecedented and bold strategies for reclaiming our lives and our future.”

Here is a direct link.