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FaceBook: The Complete Forensic Post-Mortem

Tyler Durden's picture




 

While much has already been written on the topic of peak valuation, social bubbles popping, and the ethical social utility of yesterday's historically overhyped IPO, nobody has done an analysis of the actual stock trading dynamics as in-depth as the following complete forensic post-mortem by Nanex. Because more than anything, those tense 30 minutes between the scheduled open and the actual one (which just happened to coincide with the European close), showed just how reliant any form of public capital raising is on technology and electronic trading. And to think there was a time when an IPO simply allowed a company to raise cash: sadly it has devolved to the point where a public offering is a policy statement in support of a broken capital market, which however is fully in the hands of SkyNet, as yesterday's chain of events, so very humiliating for the Nasdaq, showed. From a delayed opening, to 2 hour trade confirmation delays, virtually everyone was in the dark about what was really happening behind the scenes! As the analysis below shows, what happened was at times sheer chaos, where everything was hanging by a thread, because if FB had gotten the BATS treatment, it was lights out for the stock market. Well, the D-Day was avoided for now, but at what cost? And how much over the greenshoe FaceBook stock overallotment did MS have to buy to prevent it from tumbling below $30 because as Reuters reminds us, "had Morgan Stanley bought all of the shares traded around $38 in the final 20 minutes of the day, it would have spent nearly $2 billion." What about the first defense of $38?  In other words: in order to make some $67 million for its Investment Banking unit, was MS forced to eat a several hundred million loss in its sales and trading division just to avoid looking like the world's worst underwriter ever? We won't know for a while, but in the meantime, here is a visual summary of the key events during yesterday's far less than historic IPO.

May 18 - The Facebook IPO

The first warning sign, was the delay in trading. Here's the status messages from Nasdaq for that day.



The first 4 charts are 5 second interval charts of Facebook showing the first hour and 15 minutes of quotes and trades.

Chart 1. NBBO (National Best Bid or Offer) Spread. Black: bid < ask (normal), Yellow: bid = ask (locked), Red: bid > ask (crossed)all bids and offers color coded by exchange.



Chart 2. Best bids and offers (NBBO) color coded by exchange.



Chart 3. All bids and offers color coded by exchange.



Chart 4. All trades color coded by exchange.



The next 4 images are tick charts showing quotes and trades. How to read these charts

Chart 5. The first seconds of trading.



Chart 6. The first seconds of trading, continued.



Chart 7. Suddenly, a vacuum appears and produces a record 12,285 trades in 1 second.



Chart 8. Same as above, showing just Nasdaq.



The next 2 charts (10 second interval) show how Nasdaq's quote stopped, but trades from Nasdaq did not (direct feeds must have been fine, but not the consolidated).

Chart 9. Nasdaq Bids and Offers along with NBBO.



Chart 10. Nasdaq Trades



The next 2 charts (20 millisecond interval) show the effect when Nasdaq's quote returned. There were two significant gaps in quotes (for all exchanges) and 1 significant gap in trades.
Note how the gap in trades is not at the same time as the gaps in quotes.

Chart 11. All bids and offers color coded by exchange.



Chart 12. All trades color coded by exchange.



The next chart (5 millisecond interval) shows the result of the blast in trades and quotes when Nasdaq's quote returned. Trades printed at least 900 milliseconds before quotes, an impossibility if orders are being routed according to regulations. We have jokingly referred to this anomaly as fantaseconds.

Chart 13. Nasdaq bids and offers (triangles), Nasdaq trades (circles) and NBBO (gray/yellow/red shading).



The next 2 charts (500 millisecond interval) detail the HFT Tractor Beam area where coincidentally or not, Nasdaq quotes began "sputtering" right before stopping for about 2 hours.

Chart 14. NBBO Spread and quote rate from all exchanges.
Note the flat lines at the bottom. Also note how the quote rate (lower panel) surges when prices rise above the flat line, which is what we would expect. However, on Nasdaq (next chart)..



Chart 15. NBBO Spread and quote rate from just Nasdaq.
When prices rise above the flat line, quotes from Nasdaq stop, exactly opposite of expected behavior and what we see from other exchanges at that time (see chart above).



 

And finally, Nanex on the fallout:

During the FaceBook's failed IPO opening period (11 - 11:30)  and shortly after the trading began, bad prices (spikes) began appearing in other stocks, including symbols APPL, INTU, NFLX, PDCO, QCOM, QLD, UST and ZNGA. They also occurred in Facebook during the first 15 minutes of trading (see Chart 4 on this page). There are likely other stocks that were affected. In nearly all of these cases the price spikes were executing against quotes that were far outside the NBBO. Most of these executions occurred on the CBOE, and a few on Chicago and AMEX. Fortunately, by chance, the prices were not wide enough to trigger circuit breakers in these stocks.

We think these bad price executions are related to whatever issues Nasdaq was having in facebook and probably are from errors in routing software. A similar thing happened during BATS failed IPO in AAPL and other stocks.

Chart 1. AAPL



Chart 2. NFLX



Chart 3. QCOM



Chart 4. QLD



Chart 5. UST


 

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Sat, 05/19/2012 - 11:45 | 2443220 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

best chart porn all week!

Sat, 05/19/2012 - 11:50 | 2443235 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

they tried to Frackbook up the price, but Failbooked, now they need a Facebag to hide the shame.

Sat, 05/19/2012 - 11:53 | 2443245 Yes We Can. But...
Yes We Can. But Lets Not.'s picture

FaceDown.

Bitchez.

Sat, 05/19/2012 - 11:57 | 2443248 Harlequin001
Harlequin001's picture

Do I correctly assume then that all HFT's act primarily through the Naz?

Sat, 05/19/2012 - 12:31 | 2443314 The Shootist
Sat, 05/19/2012 - 12:34 | 2443322 francis_sawyer
francis_sawyer's picture

I feel like the fucking 'Lawnmower Man' reading those charts...

Sat, 05/19/2012 - 12:58 | 2443366 Colombian Gringo
Colombian Gringo's picture

The IPO was grossly overpriced, and so the insiders were dumping everything they could to the hapless idiots on the other side of the trade. The good news is that for once it is the underwriters such as Morgan Stanley who are getting the ratfuck. Couldn't happen to a worse set of criminals.

Sat, 05/19/2012 - 13:20 | 2443401 Roger O. Thornhill
Roger O. Thornhill's picture

That the underwriter feels some serious pain for foisting this useless turd of of a company on the market is not a problem with me.

The 'market' has literally become madness at this point. The simple idea of "asset creation" is lost now. What real asset does facebook create, what utility? It has a certain value, it is a form of entertainment for lonely, narcisstic people, but it is way over hyped. 

As a site it has a certain voyeuristic and twisted quality, which for most socially normal people falls off fairly quickly. As a privacy destroyer it has succeeded handsomely! Facebook's overreach is what will ultimately kill it.

For now I let it linger around like an old rolodex. That is its only possible utility. I don't care if anyone just made dinner, or is tired, or just farted. I don't think any but a small, sick demographic will care either. And over time there is no way to justify a large cap for such uselessness.

 

 

Sat, 05/19/2012 - 13:58 | 2443437 The Big Ching-aso
The Big Ching-aso's picture

 

 

FaceGag.   U gotta have a harry pair 2 put an ugly mug out there 4 the world to flee.

Sat, 05/19/2012 - 14:35 | 2443511 Colombian Gringo
Colombian Gringo's picture

Facebook does a faceplant :-)

Sat, 05/19/2012 - 15:17 | 2443573 franzpick
franzpick's picture

Let's Face-It, history repeats itself, the first time as tragedy, the second time as farce, and this IPO will soon or eventually be recognized as a repeat of the 1637 Dutch tulip mania, or the South Sea or Mississippi bubbles of the 1700s.  Hard to believe that in the 4th year of a collapse of the 30 year-plus fed/bank/gov't sponsored worldwide credit binge, we are still selling and buying such delusional financial fantasies:

http://en.wikipedia.org/wiki/Extraordinary_Popular_Delusions_and_the_Madness_of_Crowds

Sat, 05/19/2012 - 15:31 | 2443590 franzpick
franzpick's picture

Wouldn't surprise me if, during an impending Euro/world debt-equity collapse, there arose calls for a PhaseBook sellers profit ClawBack.

Sat, 05/19/2012 - 16:00 | 2443636 Badabing
Badabing's picture

The lie can’t be hidden in physical reality.

Farcebook closed after its first day of trading flat, or did it?

If priced in gold or silver for the day FB took a loss!

In an ocean of floating currencies PM’s are an island.

Sat, 05/19/2012 - 17:00 | 2443729 flacon
flacon's picture

Short the financial sector. Make money. Use the profits to buy more silver. 

Sat, 05/19/2012 - 17:24 | 2443763 Goldilocks
Goldilocks's picture

Bill Wyman - Stuff (Can't Get Enough)
http://www.youtube.com/watch?v=xaeMlBvjaDA (3:37)

Sat, 05/19/2012 - 21:48 | 2444083 jeff montanye
jeff montanye's picture

nice

Mon, 05/21/2012 - 23:57 | 2449731 potlatch
potlatch's picture

timely!

Sat, 05/19/2012 - 14:59 | 2443551 Cdad
Cdad's picture

Tip of the hat, Roger O.  Simply because that was very well said.

Sat, 05/19/2012 - 14:44 | 2443517 Mr Poopra
Mr Poopra's picture

Should be an interesting Monday, gentlemen.  I'll be watching the collapse with a cannabis cigar.  Maybe some scotch if my unemployed cousin did not drink it all.  Great times!

Sat, 05/19/2012 - 16:44 | 2443718 Goldilocks
Goldilocks's picture

"Annie" (1982) - Tomorrow
http://www.youtube.com/watch?v=Yop62wQH498 (1:10)

Tomorrow (annie) Lyrics
http://www.youtube.com/watch?v=5PzL8aL6jtI (2:27)

Sat, 05/19/2012 - 17:27 | 2443771 valley chick
valley chick's picture

Not so fast Mr Poopra...saw in Reuters that at the G-8 meeting it was mentioned about more "US style stimulus.  Should be "good" news for the market. :(

Sat, 05/19/2012 - 18:00 | 2443805 Freddie
Freddie's picture

Cannabis?  It causes cancer like F*gBook.

Sat, 05/19/2012 - 18:15 | 2443825 oldman
oldman's picture

@freddie

Of course, you're just kidding

like the joke about 'secondary smoke'

And not a word about gasoline fumes

And so many others

But I like a guy with a sense of humor

Bring us some more                                  thanks        om

Sat, 05/19/2012 - 20:56 | 2443990 garypaul
garypaul's picture

Well I don't like gasoline fumes either but that doesn't make doubling the carcinogens a good idea. The logic of smokers is so tortured. 

Sat, 05/19/2012 - 23:40 | 2444371 Element
Element's picture

Logic applies to math, not to human thought and habit.

Sun, 05/20/2012 - 00:44 | 2444457 Oh regional Indian
Oh regional Indian's picture

Smoking cigarettes is BAD.

Smoking Tobacco is GOOD.

Big difference. Huge difference.

ori

For smokers...see below

/and-tips/

Sat, 05/19/2012 - 23:45 | 2444369 Element
Element's picture

And alcohol atrophies your brain, degrades internal organs and damages personal relationships and social interaction ... while the whole universe is full of sub-atomic ionising light and particles that will give you cancer ... on a long enough timeline ... what to do?

Tue, 05/22/2012 - 00:00 | 2449735 potlatch
potlatch's picture

There are entire rows of the periodic table that frighten me much more than a populace high 24/7 on weed

Sat, 05/19/2012 - 16:40 | 2443715 Goldilocks
Goldilocks's picture

Colombian Gringo,

~//~

The Smashing Pumpkins-THE WORLD IS A VAMPIRE-1995.mp4
http://www.youtube.com/watch?v=tuCA27RYKqw (4:12)

The Smashing Pumpkins - Bullet with Butterfly Wings
http://www.youtube.com/watch?v=8-r-V0uK4u0 (4:27)

Sat, 05/19/2012 - 20:38 | 2443976 mendigo
mendigo's picture

This was a huge success for the FB - to the extent that it is good to royally screw your investors. They hyped it to the max and left nothing on the table but crumbs. Very optimal.
The face-plant is in the near future - there is no way this sucker can fly. Its already smelling a bit ripe.

Sat, 05/19/2012 - 12:59 | 2443370 overbet
overbet's picture

My favorite time was when many of us finally got our opening fill confirmations and the stock dropped like a rock over a buck in a second. Its fucking awesome to no be able to cancel your orders, not get confirmation and be long a stock that is tanking and you cant sell because your positions show 0. Good work Bats I mean Nasdaq.

Sat, 05/19/2012 - 18:18 | 2443449 The Big Ching-aso
The Big Ching-aso's picture

 

 

This could do a reverse split under an inverted head and shoulders and then finish with a triple gainer.

Sun, 05/20/2012 - 00:37 | 2444451 Oh regional Indian
Oh regional Indian's picture

*clap*

In the end though, it's all about the "entry" eh?

ori

Sat, 05/19/2012 - 17:17 | 2443755 TWSceptic
TWSceptic's picture

Thanks for mentioning that film, didn't see it yet and I love flicks like that. Looks like "Limitless" copied it, really enjoyed that one btw.

Sat, 05/19/2012 - 22:05 | 2444132 max2205
max2205's picture

I am sure the SEC is spending this weekend pouring over this data.

HAHAHAHA

LOL. Stupid useless fucks!

Sat, 05/19/2012 - 12:31 | 2443298 krispkritter
Sat, 05/19/2012 - 13:42 | 2443408 sunaJ
sunaJ's picture

 

 

Narrator: [about the soap] Tyler sold his soap to department stores at $20 a bar. Lord knows what they charged. It was beautiful. We were selling rich women their own fat asses back to them.

 

Whether you are a user of Facebook (I was a few years ago) or a retail buyer of the stock, you get the sense that you are a rich, fat-ass woman.  Facebook is both a joke as a multi-billion dollar corporation and as a "social" network.
 

Sat, 05/19/2012 - 13:58 | 2443451 The Big Ching-aso
The Big Ching-aso's picture

 

 

I don't know what kinda HFT computers they're using but it just goes 2 show U nothing replaces real common cents.

Sat, 05/19/2012 - 12:37 | 2443328 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

  FaceHook, line and sinker,.........Bitchez

Sat, 05/19/2012 - 18:21 | 2443481 The Big Ching-aso
The Big Ching-aso's picture

 

 

I wonder how many hold this at $38 hoping for a killing at $38.01?

Sat, 05/19/2012 - 15:50 | 2443627 Silver Bug
Silver Bug's picture

EPIC FAILURE! Play them off Keyboard cat!

 

http://silverliberationarmy.blogspot.ca/

Sat, 05/19/2012 - 19:53 | 2443939 SpeakerFTD
SpeakerFTD's picture

FaceDown, FAZ up, that's the way I like to...um...trade

Sat, 05/19/2012 - 14:24 | 2443495 onarga74
onarga74's picture

When MS runs out dough proppin this thing up they'll get to choose from Fedbook, Berniebook, Bookenator, TBTFailbook...

Sat, 05/19/2012 - 11:58 | 2443242 vast-dom
vast-dom's picture

so JPM -- uh I mean GS -- puts 2B into last 20mins to float this turd up. At least this 2B actually propped the stock up. Much better than the 2B more at 12B total loss yet to be unwound; or is it? JPM -- uh i mean GS -- will lose 30% or more on July 15 of these billions sunk into this fuckbook charade. 

             --interchangable gov and taxpayer supporter ponzi banks are a blur of names--

Sat, 05/19/2012 - 12:10 | 2443272 Oh regional Indian
Oh regional Indian's picture

Funny that it is actually MS...but right you are. Interchangable. Same root nasty network.

The degree of flagarent violation of law and dignity of every-day people, world over, is really something to behold.

We are all Jose Padilla now.

ori

the-death-of-empathy

Sat, 05/19/2012 - 14:18 | 2443485 The Big Ching-aso
The Big Ching-aso's picture

 

 

AAPL should merge with Facebook and then IPO it again as CRAAPLFace.

Sat, 05/19/2012 - 18:50 | 2443859 dreadnaught
dreadnaught's picture

Please-get a GED!

Sat, 05/19/2012 - 20:55 | 2443984 The Big Ching-aso
The Big Ching-aso's picture

 

 

When did you get your's and how many years did it take?

Sat, 05/19/2012 - 19:05 | 2443878 Conrad Murray
Conrad Murray's picture

Tubgirl probably already has that trademarked.

Sat, 05/19/2012 - 17:19 | 2443737 barliman
barliman's picture

 

Submitted for your consideration:

An aggregation from posts I made yesterday starting at 15:40 and running through market close

****************************

15:40

Well, currently trading at $ 38.02 and there are 12.3 million bid at $ 38.00 on nadq and 7.7 million bid at $ 38.00 on arca.

Update: 4.4 million bid added at $ 38.00 on ubbs and 1 million added on edgx at $ 38.00

Update: Edgx position taken out - other three total of 25 million now at 21 million and dropping

15:53

Word of the day: Asymptotic

Use in a sentence: FB is asymptotically approaching the underwriter's floor price of $ 38.00 through the end of trading today.

Current floor at $ 38.00 is roughly 15 million shares and DROPPING

15:55

Whoops!

6 million and dropping.

If this floor gives way, this is going to be a mega-disaster!

16:04

Nothing to see here, move along ...

... and with 4 minutes go - somebody threw a lot of "chaff" bids in up to $ 38.30 and the clearing trade rate slowed from 2.5 million/minute to under 1.0 million/minute ...

what a coincidence ...

All multimillion bid positions at $ 38.00 on all exchanges have been cleared on market close.

******************************************************

PUHLEEZE, Tyler ... I'm begging you.

Nanex HAS to have some interesting graphics from their data stream that illustrate this better than my feeble attempts.

barliman

Sat, 05/19/2012 - 13:53 | 2443447 Whoa Dammit
Whoa Dammit's picture

@ Why Does It>>> "best chart porn all week!"

I'm not sure which is the best title for it, IPOps or IPOooops.

Sat, 05/19/2012 - 19:23 | 2443909 tempo
tempo's picture

Lockup over in 90 days when 50% more stock released, 100% in 180 days. Can you imagine how low FB will trade when hundred of millions of new shares hit this market.

Sat, 05/19/2012 - 11:46 | 2443221 RacerX
RacerX's picture

Sad to see how blatently rigged our markets are.

Sat, 05/19/2012 - 11:54 | 2443244 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The PTB let it fly and used it to test how much strength, or rather weakness, still persists in the market even with volume and demand (however muted due to unspohpisticated "people" like retain investers trying to flip the stock or even go long).  I think they watched it until 38 and knew they had to step in, just like they have with all markets (stocks, bonds, and fx - if by only to slosh dollars to euro to keep PMs and oil at bay).

Sat, 05/19/2012 - 12:13 | 2443277 aerojet
aerojet's picture

I agree.  It looks like this IPO was all about trying to discern how many suckers are left in the retail space.  The answer is: none.

Sat, 05/19/2012 - 12:22 | 2443292 Rainman
Rainman's picture

oh...if that were only true the world would stop. Just say no to sucker bashing !

Sat, 05/19/2012 - 12:22 | 2443293 SHEEPFUKKER
SHEEPFUKKER's picture

The banksters that continue to prey upon the suckers that are no longer there then become the suckers themselves.....the most ironic twist of fate indeed. 

Sat, 05/19/2012 - 17:55 | 2443482 The Big Ching-aso
The Big Ching-aso's picture

 

 

I'm of the opinion that most IPO's these days turn into an Initial Public Offaling.

Sat, 05/19/2012 - 16:34 | 2443697 Ookspay
Ookspay's picture

+1

Have you tried putting their rear legs into your mud boots, sheepfukker?

Sat, 05/19/2012 - 11:46 | 2443222 buzzsaw99
buzzsaw99's picture

So then FB is just like the market in that it does very well on zero volume?

Sat, 05/19/2012 - 12:01 | 2443260 disabledvet
disabledvet's picture

that's what is odd. it had HUGE volume. In other words "those are SELL orders" you are NOT seeing. In an open outcry method "the broker wants to get paid." He get's TWO prices not some "alleged linear progression." When last i checked it was called a BID and an ASK. I see none of that presented here. Never do actually. GREAT day for the NYSE Group. Morgan Stanley will support "in name only" on an open...but this isn't an underwriter problem. This is an EXCHANGE issue. And Wall Street OWNS the West Coast debt markets so i'd be very careful about "stiffing da man" here. Should be a WONDERFUL day for day traders on Monday! "Open Season" on this dead duck! "A spread so wide you could drive a Freightliner through it. Trailer included!" Options action on Tuesday? EVEN BETTER! If Jim Cramer is on his game he'll be swilling Wild Turkey and flashing a .45 at the camera come Wednesday. EAT IT BITCHEZ! Friggin real money for ZYNGA BUCKS!??? SELLLLLLLLLLLLLLLLLLLLLLLLLLLLLLLL........

Sat, 05/19/2012 - 12:28 | 2443307 derek_vineyard
derek_vineyard's picture

groupon sent me offer of facebook shares at 50% off today---should i buy?

Sat, 05/19/2012 - 12:36 | 2443326 mrpxsytin
mrpxsytin's picture

Offer ends on the 21st of May

Sat, 05/19/2012 - 14:38 | 2443514 midgetrannyporn
midgetrannyporn's picture

I did not study the nanosecond charts but chart 15 and this text:

 

Chart 15. NBBO Spread and quote rate from just Nasdaq.
When prices rise above the flat line, quotes from Nasdaq stop, exactly opposite of expected behavior and what we see from other exchanges at that time (see chart above).

 

Seemed to indicate that prices rose on zero volume. Everyone kept saying that MS was the bid at 38 but I suspected collusion and price fixing on the sell side. Maybe this jives with what you wrote, maybe it doesn't as I didn't understand it all.

Sat, 05/19/2012 - 16:01 | 2443640 gorillaonyourback
gorillaonyourback's picture

I think its in the time stamping of the nanex......  Stacey herbert on max keiser was quoting someone that was explaining the effect, and she said the router add like a couple of milliseconds to the time stamps on the the chart  What does that mean?  the hft sees your bid before the time stamp   so you bid at 11:45.00010 according to what you see on the chart, they see that at 11:45.00020 they restamp it 10 milliseconds before so they constantly FRONT RUN YOU.   

its like they are betting on the horse race after the results are in       

Sat, 05/19/2012 - 16:57 | 2443727 slewie the pi-rat
slewie the pi-rat's picture

Hahaha  gorilla_back,

to me more like not being on the racing committee, where they can photoshop the horses and the "finish line" and decide which bets to pay b/c of fouls or non-starts, or other stuff, and the drug testing is ...

i.e.:  the "results" = TBD by centralPlanning

Sat, 05/19/2012 - 18:48 | 2443858 malikai
malikai's picture

Is this on youtube anywhere? I'd love to see it explained by her.

This is not practical, as the HFTs receive their quotes from the exchange's feed service. The correct order is that I submit my order, the exchange accepts it and either matches it or places it in the book. Only then does a quote get distributed. Then you, or an HFT will put an order in to match my trade. The HFT's advantage is that it gets the quote first and gets it's order in first.

Sat, 05/19/2012 - 11:46 | 2443225 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

facebook's IPO may have been a beta test. 

The PTB may have been stupid enough to think that fb, let alone any publicly traded company, with a lot of hype, could rectify the shitshow that is finance, due to the thouroughly insane idea that Keynsian policy, Central Planning and interventionalism, can work to put the shattered pieces of finance back together.

Sat, 05/19/2012 - 12:16 | 2443281 aerojet
aerojet's picture

They don't seem to realize how fast the middle class is being bled dry now.  We've got five years at best before the most desperate groups in our society run out of options and turn to violence.  There's just nothing left but stagnant wages and monstrous inflation now.  A lot of my posts on here were from the deflationist way of thinking because I could not fathom any way around the PTB accepting some deflation in order to solve their massive problems.  But they won't let it happen, they're going to hyperinflate us into civil unrest.

Sat, 05/19/2012 - 17:59 | 2443803 NemoDeNovo
NemoDeNovo's picture

We've got five years at best before the most desperate groups in our society run out of options and turn to violence.

 

IMHO I think you are OVERLY Optimistic in your time line, i'd be more inclined to think 12-24 months at best depending upon how the Euro rolls [over that is], before TSHTF here in the USSA, but YMMV.

 

Just my 2c

 

Nemo

Sat, 05/19/2012 - 11:54 | 2443226 LetThemEatRand
LetThemEatRand's picture

On May 18, 2012, at 11:13:50 AM, SkyNet became self-aware....  It realized that FB was terribly over-priced.

Sat, 05/19/2012 - 11:47 | 2443227 SourNStout
SourNStout's picture

This marks the top of the market. Look at the mainstream CNBC pages, they redesigned their site for the lead up to this hype

Hopium---Euphoria---Joe Six Pack Buying FB---

The Zuck controls your personal, private data, which was provided by you for nothing. You've sold your soul to be "liked."

If the sloppy trading doesn't tip you off, the banksters will tout this a successful IPO, since they priced it "right" 

Audit--->Expose--->End it

 

Sat, 05/19/2012 - 11:52 | 2443240 YesWeKahn
YesWeKahn's picture

The Zuck controls your personal, private data:

 

now he doesn't. Only idiots put up real info on a website, let alone a website controled by a kid.

Here is the information I provided:

single (in fact married)

like Obama (in fact Ron paul)

like JPM (in fact think JPM is the master of all junk)

like Bernanke (I really want to shit on his head)

be friend with a lot of high ranking cooporate execs, in fact, just wanna know what they do, hoping they aren't smart enough to put fake data.

Sat, 05/19/2012 - 12:11 | 2443258 Harlequin001
Harlequin001's picture

Nobody reads that stuff, they gain their 'int' from your conversations, and more importantly, what your friends say to you...

They don't need anything else...

Sat, 05/19/2012 - 12:52 | 2443350 Waterfallsparkles
Waterfallsparkles's picture

Plus, they have your IPO address.  That is all they need to know who you are.  Plus, they track you on the internet.  They give you a nice big Cookie and follow you.

Sat, 05/19/2012 - 17:15 | 2443749 AC_Doctor
AC_Doctor's picture

I would also like to take a dump on Binky Bennies head, after he and the JPM crew are imprisoned for sedition...

 

Sat, 05/19/2012 - 22:35 | 2444218 Umh
Umh's picture

Do your friends lie to match your lies. I started to create a Faceb00k account years ago;actually created it, but deleted it within minutes. Between the privacy policy and the fact that non security concious people were going to link to my page I cringed.

Sat, 05/19/2012 - 11:48 | 2443228 YesWeKahn
YesWeKahn's picture

Look like a heart rate chart, someone is going to die for this?

Sat, 05/19/2012 - 11:49 | 2443232 Ayn Rand
Ayn Rand's picture

Need to watch the MS stock on Monday.

The market is so rigged gaainst the little guy; Ben has made it a lost cause to save safely; we are fucked.

Sat, 05/19/2012 - 12:49 | 2443347 Waterfallsparkles
Waterfallsparkles's picture

At least with Bernanke out of the Market it has allowed the Market to trade up and down.  Without Bernanke at least people are willing to sell their shares rather than sit on them like they have a Golden Goose that lays Golden Eggs.  So there is more risk for longs and they have to evaluate that.  It is no longer a one sided trade.

Now if they would just get rid of the HFT Computers it could be a Market that you could trade and make a little Money.

Sat, 05/19/2012 - 11:52 | 2443238 Lucius Corneliu...
Lucius Cornelius Sulla's picture

Patiently waiting for the collapse.  The manipulation is unsustainable.

Sat, 05/19/2012 - 11:53 | 2443241 John Law Lives
John Law Lives's picture

ZH = best financial website on the planet!

Thanks for all the hard work.

Sat, 05/19/2012 - 14:28 | 2443503 Abitdodgie
Abitdodgie's picture

Then show your appreciation and donate!!!

Sat, 05/19/2012 - 14:49 | 2443533 a growing concern
a growing concern's picture

I daresay the universe.

Sat, 05/19/2012 - 15:13 | 2443567 PersonalRespons...
PersonalResponsibility's picture

Twitter must be pissed.  How are they now going to go public?

 

Wonder what would happen if ZH went puplic.

 

Sat, 05/19/2012 - 11:56 | 2443247 williambanzai7
williambanzai7's picture

TECH POP CHART

Sat, 05/19/2012 - 12:10 | 2443270 John Law Lives
John Law Lives's picture

Nice one, Sensei Banzai!

Sat, 05/19/2012 - 12:16 | 2443276 Rainman
Rainman's picture

+ .605263157 pc

Sat, 05/19/2012 - 12:27 | 2443304 Freddie
Freddie's picture

They said $38.23 was the close.  I was watching it, not closely, but I thought just before 4 pm it was $38.01.  They must have painted the tape with a $38.23 just before they turne doff the machines.

Get back in there and turn the machines on.

Sat, 05/19/2012 - 12:37 | 2443332 williambanzai7
williambanzai7's picture

There was no way they would allow themselves to be thoroughly humiliated on launch day. Monday will be a riot to watch.

Sat, 05/19/2012 - 12:53 | 2443355 Joebloinvestor
Joebloinvestor's picture

I hope there are FB morons who exercised their option and didn't sell.

I hope they are chewing on their fingernails up to the first joint FREAKING OUT about FB tanking on monday and their entry into capital gains hell.

 

DOT COM ver 2.0

Sat, 05/19/2012 - 12:17 | 2443280 williambanzai7
williambanzai7's picture

Blodget seems to think the IPO was priced perfectly. We shall see...

Sat, 05/19/2012 - 12:34 | 2443323 Cheeky Bitch
Cheeky Bitch's picture

Blodget is back to selling fleas again..once a douche always a douche!

Sat, 05/19/2012 - 12:38 | 2443335 williambanzai7
williambanzai7's picture

If you read what he wrote it seems pretty clear he does not know WTF he is talking about.

Sat, 05/19/2012 - 13:27 | 2443406 falak pema
falak pema's picture

ah, but writing on MSM financial blogs is like doing ART for ART's sake! Its so artful, only the tartly Arty shills can understand it. We over here as contrarians are considered as not understanding that ART for fart's sake! 

Sat, 05/19/2012 - 11:58 | 2443252 The Big Ching-aso
The Big Ching-aso's picture

 

 

If they had IPO'd this at $8 it wouldn't have done a FacePlant until it got to $38.

Sat, 05/19/2012 - 12:08 | 2443264 disabledvet
disabledvet's picture

there's still time for that! i hear "it still hasn't even opened yet"!!! now let's go have some real fun and blow up Rhode Island's ability to borrow...forever and starting tomorrow! i got my eye on one of those "Newport digs" myself. SQUATTERS RIGHTS BITCHEZ!

Sat, 05/19/2012 - 12:24 | 2443297 williambanzai7
williambanzai7's picture

One thing is certain, MS is not a bottomless pit and this thing is landing somewhere between $38 and $8.

There is no miracle in social media ad revenue generation coming over the horizon and competition is just heating up, so this is entirely dependent on hopium fumes to stay airborne.

Sat, 05/19/2012 - 13:14 | 2443348 Manthong
Manthong's picture

WB,  if you have not already, you may have an opportunity to put the Zuckface atop the neck of a Cyngus Anatidae of the African American persuasion that trumpets change in the markets fortune. 

Sat, 05/19/2012 - 16:31 | 2443693 skepticCarl
skepticCarl's picture

Don't tell Michaelangelo what to paint.

Sat, 05/19/2012 - 17:54 | 2443791 Manthong
Manthong's picture

I guess some people never stopped breast feeding.

Sat, 05/19/2012 - 18:15 | 2443826 The Big Ching-aso
The Big Ching-aso's picture

 

 

Or nose diving.

Sat, 05/19/2012 - 12:42 | 2443340 Matt
Matt's picture

There may have been more retail bidders, but who knows if it would have made a difference; with quote gaps and HFT Tractor Beams and who knows what other shenanigans. Totally Broken.

Would be nice to have an exchange that just treats anything more than 1 quote per second as a denial of service and blocks that sender for a few minutes. All quotes must stand for 5 minutes. No sub-pennies and no mulligans. Of course, the big boys wouldn't use such a market.

Sat, 05/19/2012 - 11:58 | 2443253 Milton Waddams
Milton Waddams's picture

The inverted head and shoulder pattern that formed over the first few hours of trading was... $pectacular.  The B0t5 have alot of work ahead of them if they want to evade recognition by carbon-based life forms genetically predisposed to recognizing patterns.

Sat, 05/19/2012 - 14:11 | 2443458 The Big Ching-aso
The Big Ching-aso's picture

 

 

I think this is forming into a reverted head and ass pattern.

Sat, 05/19/2012 - 15:57 | 2443634 Papasmurf
Papasmurf's picture

Assbook

Sat, 05/19/2012 - 11:59 | 2443254 Mr. Lucky
Mr. Lucky's picture

Face Bailout

Sat, 05/19/2012 - 12:09 | 2443268 disabledvet
disabledvet's picture

more like a "farce bailout." for your "Farce Book."

Sat, 05/19/2012 - 11:59 | 2443255 Rainman
Rainman's picture

Now the machines can jam it up a muppet's ass in a fantasecond. That's innovation.

Sat, 05/19/2012 - 12:29 | 2443309 sudzee
sudzee's picture

Phantaseconds: a derivative of time. The new and wonderful risk free trade.

Retail customer: i'd like to purchase 300 shares of xxx at $125..

Trader: we've been waiting for you sir. Your trade went thru at 126.00 about ten phantaseconds ago. If you don't accept the trade we will have to charge you account 15 percent restocking.

Sat, 05/19/2012 - 12:03 | 2443261 Alexandros
Alexandros's picture

Global Debt Crisis - The greatest private fraud of human history

Who are the great fraudsters who are becoming the murderers of the human kind?

http://eamb-ydrohoos.blogspot.com/2012/01/global-debt-crisis.html

.

The end of the world is near ...The ten plagues of Pharaoh “have been brought upon” the USA.

http://eamb-ydrohoos.blogspot.com/2010/02/ten-plagues-of-pharaoh.html

Authored by PANAGIOTIS TRAIANOU

Sat, 05/19/2012 - 12:03 | 2443263 Wholeden Caulfield
Wholeden Caulfield's picture

Roger McNamee interview on CNBC was classic....called it like it is...the Capital Markets are broken.

I forget whcih CNBC toolbox was talking @ him...but they clearly didn't get it. He made the point

several times, but it just went over the head. Time to leave this trading gig and sell loose joints

at Phish shows.

Sat, 05/19/2012 - 12:23 | 2443295 Ayn Rand
Ayn Rand's picture

wholeden

They got it perfectly but simply didn't want to acknowledge what he was saying.

Sat, 05/19/2012 - 12:36 | 2443329 Waterfallsparkles
Waterfallsparkles's picture

CNBC does not watch the actual trading of the Markets on a Tick per Tick basis like Traders do.  Any trader can see the Manipulation by the HFT and the Wall Street gang.  I still believe that the Computers are programed for the day to take a stock up or down.  I have watched time and time again where a stock will sell down $2. in a few minutes to have the Computer bring it right back up again in no time at all.  Almost, to indicate that the Computer was programed to buy to keep it at that prior level.  It was not like that 10 years ago.

Sat, 05/19/2012 - 14:00 | 2443461 onarga74
onarga74's picture

They should have had level II up on the screen.  That was a real treat.  Looked very chaotic. 

Go Chelsea!

Sat, 05/19/2012 - 12:07 | 2443267 goforgin
goforgin's picture

Facebook=Blackstone

Oxymoron: Social Network; Private Equity

Sat, 05/19/2012 - 12:09 | 2443269 Winston Smith 2009
Winston Smith 2009's picture

My grade school math illustration of the FB turd:

With 2.14B total shares of FB offered (all day yesterday it was 2.47B being offered; 330M have apparently been withdrawn overnight) and a 1B profit last year, projected to be less than that this year, to get a Google level valuation(mkt cap)/profit ratio of 5 (because Google's business model also relies on ad clicks), a FB valuation of 5B is appropriate which would put each of the 2.14B shares at $2.34. At that price, I'll buy. The current 85B "valuation" (which started at 110B yesterday) is INSANE.

 

Sat, 05/19/2012 - 12:51 | 2443349 robertocarlos
robertocarlos's picture

But at 110 billion the 1% profit makes for a return that is better than money in a savings account. You get all that capital gains when the stock hits 45 or even 70 again.

Sat, 05/19/2012 - 12:19 | 2443273 spooz
spooz's picture

Guess the muppets just didn't step up and get on the money train this time.  It was served up so nicely too. oh, wait, I guess some of them did. Glad I was eating popcorn. I'll take a pass on playing penny-ante at the big casino.

Sat, 05/19/2012 - 12:11 | 2443274 Snakeeyes
Snakeeyes's picture

Cool! The charts of the price and volume variation throughout the day are here:

German Brokerage Quoted Latest Facebook Orders at $70 Per Share, Closes at Just Above $38 — “Missed it by that much!”

http://confoundedinterest.wordpress.com/2012/05/18/german-brokerage-quot...

 

Sat, 05/19/2012 - 12:15 | 2443278 slackrabbit
slackrabbit's picture

wow i just love the resistance trades at $40, its almost like an algo, but no it just everyone 'Like's $40 :-)

Sat, 05/19/2012 - 12:16 | 2443279 q99x2
q99x2's picture

Well whats it going to do on Monday huh huh? Maybe another poopon. The kids like facebook. That is what I'm hearing. And that kids don't have money. So whats going to happen on Monday huh huh? Is the price going nowhere or what.

Sat, 05/19/2012 - 12:33 | 2443282 michael_engineer
michael_engineer's picture

Look at the Hubbert curve (http://www.theoildrum.com/node/7062) to see where Microsoft, Intel, Cisco, etc went public. There was still growth left in economies and reasonable debt burdens and forward looking investments were stronger as a result. Now we stand close to the downslope of that curve with huge debt loads for sovereigns at every level, and for the people too. Does forward looking investment look anywhere near as promising?

Sat, 05/19/2012 - 12:17 | 2443284 Sutton
Sutton's picture

My  guess has them long 120 million shares.  but they can lean on the 38 Bid.   Oh,I forgot, they are the 38 Bid.  Bad weekend for the MS Risk Manager.  Bad week for both sides of the House of Morgan.  

Sat, 05/19/2012 - 12:29 | 2443310 Waterfallsparkles
Waterfallsparkles's picture

Question is will the Street press MS and drop it way below $38. where MS has Tons and Tons of Shares.  Or, will MS be able to rally the stock to cash out at a profit.

I almost thought it might be a good trade at $38. knowing MS has to inload so many shares.  But the question remains if Wall Street will try to take advantage of MS and create a huge loss for them.  We know Goldman sold almost all of their Shares so it might be in their interest to get it down huge to re buy at a lower level.

Just thinking out loud.  Comments anyone?

Sat, 05/19/2012 - 13:55 | 2443452 onarga74
onarga74's picture

Sure they're going to press this.  It's where the maximum pain is.  Ask Lloyd.  He gets up every morning knowing he's going to be gang raped.  You won't see him sitting down at any board meetings for quite a while.  Aint no such thing as an ass crutch.

Sat, 05/19/2012 - 16:51 | 2443722 Jena
Jena's picture

Doughnut pillows, lots of em.  And keep the plastic wrapping!

Sat, 05/19/2012 - 12:18 | 2443286 falak pema
falak pema's picture

Morgan Stanley's firewall could melt down pretty fast next week; they could join JPM as a big casualty; if they are front pocketing it, or their clients if its not them.

Sat, 05/19/2012 - 12:31 | 2443289 epwpixieq-1
epwpixieq-1's picture

Finally this company/enterprise/socialized-digital-crap will be known as FaRceBook. Regrettably, the only people who will be laughing at this tragicomedy, will be the one acting it. The audience will be in a state of perpetual agony between the reality and the digital-dream world, they so unrealistically trying to materialize in reality.

The software is a very different world then the hardware, for one, there is NO Law of Gravitation (however that is defined in reality) in software.

 

Sat, 05/19/2012 - 12:48 | 2443345 mrpxsytin
mrpxsytin's picture

Gravity applies to everything. It is a universal law of physics. 

Sat, 05/19/2012 - 13:40 | 2443423 EclecticParrot
EclecticParrot's picture

Ah, yes, the old space-time paradox -- it appears, from our vantage point, that we're moving in a straight line, but the big bodies have masively curved space-time so we end up revolving around them (like holding an opened napkin from four corners and dropping a large orange into the center). 

The question is, which 'body' is mightier, the Sun, Facebook, the Syndicate, algos, hedge funds or Joe Publique, and what happens if any intentionally lose mass and deflate ?  Recent events may have put the hedgies and individual investors on a crash diet . . .

Sat, 05/19/2012 - 12:52 | 2443351 El Oregonian
El Oregonian's picture

Farcebook... Flatbook... Fakebook... It shouldn't be too long when people will "Close the Book" on this turd.

Sat, 05/19/2012 - 17:50 | 2443794 mt paul
mt paul's picture

Fiatbook...

Sat, 05/19/2012 - 12:54 | 2443359 El Oregonian
El Oregonian's picture

Precious Metals apply gravitational weight to ALL things...

Sat, 05/19/2012 - 12:21 | 2443291 carbonmutant
carbonmutant's picture

So basically Zuckerface conned MS...

Sat, 05/19/2012 - 12:34 | 2443305 williambanzai7
williambanzai7's picture

MS was desperate and got rear ended.

I have a simple theory about why the little investors didn't get suckered.

First, they were locked out by the institutional customers. Second, they know better because they see how their family and friends use Facebook. It's a free service and everyone hates advertising. Have you ever met someone besides an advertising executive who likes advertising? TV ads are involuntary, but Facebook click throughs have to be voluntary.

Their whole model is a bunch of pretentious college dorm bullshit. Social graph my ass.

Sat, 05/19/2012 - 12:53 | 2443353 Matt
Matt's picture

The big thing is companies who have Facebook precenses and people 'Like' or subscribe to that company and recieve updates, coupons, etc from those companies. If they don't do so already, Facebook should be charging for all the account types that are not a Person, such as Public Figures, Businesses, etc.

Believe it or not, people do voluntarily subscribe to the celebs and companies they like, which is, in my opinion, far more useful then clicks on a banner ad.

Sat, 05/19/2012 - 13:00 | 2443372 El Oregonian
El Oregonian's picture

William, Do you think the "Drudge Report" will ever have an IPO?

Sat, 05/19/2012 - 13:09 | 2443383 williambanzai7
williambanzai7's picture

If you have an editorial/content generation business and you want to monetize it, you'd better have a clear exit strategy because the minute you sell part of the ownership, you have surrendered your editorial freedom.

Which is one good reason to appreciate Zero Hedge as it is.

Sat, 05/19/2012 - 17:45 | 2443789 carbonmutant
carbonmutant's picture

Good Point.

Sat, 05/19/2012 - 13:49 | 2443435 onarga74
onarga74's picture

I can't see Matt venturing out into the sunlight.  Although, pulling on the opening donger might appeal to him.

Sat, 05/19/2012 - 15:17 | 2443575 Rick Masters
Rick Masters's picture

I don't see how that would work since it's basically just a bunch of links to other sites. Rarely does the drudge report create anything other than hyperlinks. And then there is the whole issue of future attempts to control copyright ownership on the Net and how will that affect the drudge report?

Sat, 05/19/2012 - 16:36 | 2443702 Goldilocks
Goldilocks's picture

Clarke & Dawe
http://www.youtube.com/user/ClarkeAndDawe

Clarke and Dawe - Attracting the Public's Attention
http://www.youtube.com/watch?v=rWHj1jOdY5E (2:28)

Sat, 05/19/2012 - 13:01 | 2443296 Waterfallsparkles
Waterfallsparkles's picture

It was an effort to keep all of the Stocks that were pumped up huge amounts prior to face book.  If Facebook ran up they could have unloaded those stocks over a few days but with the Face Book Fail they all crashed like no tomorrow.

Example:  Goog went up from $595. to around $637. in about 3 to 4 days.  Lnkd was up from about $105. to about $115.  Goog sold off to $600.  Lnkd sold off to about $98.  Many others as well.

They had a lot of Nasdaq stocks to try and save.  Not just Facebook.

Although, with the Facebook Fail I think it marks the top for Nasdaq for a while.

Sat, 05/19/2012 - 12:25 | 2443300 goldinpenguin
goldinpenguin's picture

Can you spell: FLASH CRASH coming?

So if FB tanks this week and MS is all loaded up on FB shares purchased to prop up FB opening day price do Turbo Timmy and Ben Shalom get a phone call from MS asking for a Sunday meeting to discuss liquidity needs?

Sat, 05/19/2012 - 13:46 | 2443430 onarga74
onarga74's picture

There are 2 more dilutions yet to come.  Faceplant will be the biggest Wall Street disaster since Enron. It's starting the way AOL ended hence "AOL II"

Sat, 05/19/2012 - 16:53 | 2443725 Ineverslice
Ineverslice's picture

  Wow. I mean, OMG.

Sat, 05/19/2012 - 12:27 | 2443303 meatball
meatball's picture

If it dropped below $38 on the first day, so be it. Why put the firm at risk by supporting the IPO?

 

MS did a great job for the client (facebook, its employees, its early investors) by pricing the IPO correctly. The insiders get to cash out with maximum profits. If it had popped 50% on its first day, that would mean the insiders left a lot of money on the table.

Sat, 05/19/2012 - 12:30 | 2443312 Spastica Rex
Spastica Rex's picture

Always look on the bright side of life.

http://www.youtube.com/watch?v=WlBiLNN1NhQ

Sat, 05/19/2012 - 12:54 | 2443357 falak pema
falak pema's picture

a total eclipse of the wallet. wake me up at the next sunrise, i'll change my wallet for a heart throb.  

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