THE PUBLIC EYE: The Facebook Debacle

By Bob Burnett
Friday June 08, 2012 - 09:56:00 AM

On May 17th, Facebook had its long anticipated Initial Public Offering (IPO). It sold shares at $38 each, giving it a market valuation of $104 billion. For an instant, Facebook was the 23rd most valuable company in the US. The ensuing debacle serves as a metaphor for the US in general.

Facebook is an eight-year-old social networking service that has over 900 million users worldwide. It’s a convenient way to maintain contact with family and friends – for example, to post photos of your new relationship or grandchild or pet.

There’s nothing wrong with Facebook selling stock in order to raise money and compensate its employees and investors. It’s the dream of every entrepreneur to start a company that one day becomes successful, has an IPO, and makes its founders wealthy. It’s the nature of the free market.

But in this case there was a serious problem with the valuation of Facebook stock. On May 17th Bloomberg Financial Services reported that at $38 per share, Facebook would be “the largest company to go public in the U.S. by market capitalization… Facebook's valuation is worth the combined market capitalizations of News Corp., Time Warner Inc. and CBS Corp.” At its offering price, Facebook was worth more than: Amazon, McDonald’s, Cisco, Comcast, Visa, and Citigroup, among others. On May 17th Facebook ranked in the top 10 of technology companies; Facebook was worth roughly half of Google, the company it is most often compared to.

Then the bubble burst. As soon as Facebook shares (ticker symbol FB) were available to the public, the price began to drop. As of this writing, the stock price is $26.31 and the market value is $56.25 billion. -more-

ECLECTIC RANT: Bananas Over Fair Trade

By Ralph E. Stone
Friday June 08, 2012 - 10:41:00 AM

The main goal of Fair Trade is to ensure that producers — usually located in underdeveloped countries — treat their workers well and pay them a fair price for their labor, which in turn helps the workers to improve their lives. For consumers, it’s a simple way to choose products, knowing that those who grew or made the products were treated fairly and paid a fair price for their labor. When a product carries a Fair Trade label it means the producers and traders have met standards of the certifying organization. Farmers are audited annually. Thus, sellers agreeing to sell Fair Trade products and consumers buying these products are relying on the integrity and diligence of the certifying organization. And how much extra will a consumer be willing to pay for a Fair Trade certified product—5 percent, 10 percent? -more-

ON MENTAL ILLNESS: Teaching Persons with Mental Illness How to Survive

By Jack Bragen
Friday June 08, 2012 - 11:50:00 AM

My father died recently and didn't leave a mess behind for others to clean up. He was caring and considerate of others for the entire 47 years that I knew him. He worked most of his life, supported his family, and was a jokester and a mensch. His death was a shock, and it came far too soon. The kindness and the caring he radiated will be sorely missed. -more-

SENIOR POWER: Elder Abuse 2012

By Helen Rippier Wheeler
Thursday June 07, 2012 - 05:30:00 PM

World Elder Abuse Awareness Day is Friday, June 15. It’s quite possible, even likely, that it will come and go with little local recognition.

Every five seconds, an elderly person is abused. In 2011, California accounted for 10.6% of elder abuse cases in the United States. Five of California’s 58 counties account for over half of all elder abuse cases. ((Los Angeles, Orange, San Diego, Riverside and Santa Clara) Alameda County’s 233,823 elderly accounted for 25,827 abuse cases. California's elderly population will have doubled by 2025, to 6.4 million -- a larger growth rate than any other state. -more-

MY COMMONPLACE BOOK(a diary of excerpts copied from printed books, with comments added by the reader)

By Dorothy Bryant
Friday June 08, 2012 - 10:56:00 AM

“By the time a man is 50, he has the face he deserves.” —George Orwell

“. . . an untidy, preoccupied woman, whose face was beginning to take on the shape of the thoughts and emotions she had lived through, in place of the likeness of heredity with which it had been born.” —Nadine Gordimer, Occasion for Loving (1960) -more-