Why coming FACEBOOK CRASH will take down the whole market. Happening soon. Futurist explains

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Facebook share prices will collapse for sure, and it will start happening soon. There are two main reasons, explained below. 

The first is share prices are vastly overpriced. Stock analysts think the P/E ratio is not bad, as they refer to something called “forward earnings.” Folks, there is no such thing! What they should say, but they don’t, is “Estimated Forward Earnings” with the operative word being estimated. And who is doing the estimating? Bozos who actually think there is something called Forward Earnings.

I like to look at things differently, in round numbers. The market value of facebook is about $182,000,000,000. In recent quarters they have earned around $752,000,000. OK, let’s do something very simple here….. take 6 zeros off of each number. That means for each $182,000 they earned 752 bucks. Now let’s say you have a very bright neighbour with a promising idea. And you give him $182,000, and after a while he reports the business is making $752 every three months. Around $3000 per year. Would you be happy with that? Would you start to think maybe you would like to get your $182,000 back? He would say, “Yeah but, next quarter looks better, blah blah blah.” What if next quarter is about the same, or down a bit? What if the quarter after that it is down again? Would you start to get nervous about your money? And your $182,000 is getting burned up at a faster and faster rate? This is what is happening NOW. In my city facebook has ads at bus stops, trying to get more viewers. This is a desperate move, and involves burning a lot of money.

The second reason facebook will crash is this: Tests have shown that fb ads are about 1/10th as effective as google ads. Yet facebook is charging close to google rates. What will happen when facebook advertisers reaize their ads on facebook are not cost effective? What will happen when savy facebook advertisers quit advertising with facebook? Facebook profits will plunge next quarter, and their stock will be down 20 to 30 percent. The next quarter after that the stock price will be HALF of what it is now. Wait and see, more about this on my site. 

PS: Google is getting away with overcharging too, and they will get away with it for a while longer, but google will have to get used to getting about 1/4 as much per ad as they are now. Google will crash too! More about this on my site. 

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