However big a clusterfuck you may have previously believed the Facebook IPO was, this WSJ article – Nasdaq CEO Lost Touch Amid Facebook Chaos — makes you realize it was actually worse, much worse.

The Journal politely but devastatingly skewers Nasdaq for the bungled IPO trading. The words that come to mind is inexcusable and incompetent. (No mention of HFT though)

That said, the train wreck most likely would not have happened had Facebook not been so wildly over valued at $104 billion dollars. That was what filled the warehouse with dangerous vapors, waiting for a spark.

Nasdaq’s snafu provided the igniter.

 

 

click for larger graphic

 

 
Source:
Nasdaq CEO Lost Touch Amid Facebook Chaos
JENNY STRASBURG, ANDREW ACKERMAN and AARON LUCCHETTI
WSJ, June 11, 2012 
http://online.wsj.com/article/SB10001424052702303753904577454611252477238.html

Category: IPOs, Trading, Valuation

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

13 Responses to “Facebook + Nasdaq = Faceplant”

  1. PeterR says:

    As previously posted, “Fa(r)ceBook.

    Another tip of another iceberg, along with Spain’s banks, Greece, now Italy, the EU, etc. etc..

    Mayday Mayday Mayday!

  2. albnyc says:

    The WSJ couldn’t find a better poster boy than someone who ponied up for a big 85 shares?

  3. dead hobo says:

    BR conjectured:

    That said, the train wreck most likely would not have happened had Facebook not been so wildly over valued at $104 billion dollars.

    reply:
    ——–
    No. In days gone by, I had a conversation or two with IT project managers who truly believed their personal charisma, skill at handling management, and ability to bully everyone was a substitute for competent work. All were otherwise quite stupid at the task at hand. Their best skills were sounding smart and pushing people around.

    Undoubtedly, there were one or several people who wanted to test the system at 1 billion transactions, or some number believed to be 10x the probable size. They were probably threatened with their jobs and various toadies were instead considered project superstars … until the massive transaction handling failure. Then the toadies became invisible and the bullies may have sniveled adequately enough to escape responsibility.

    While this kind of massive incompetence couldn’t exist without massive incompetence in upper management … in the form of control failures and basic slackerism, the idiots in IT project management still need to be recognized for their laziness and desperate need to be fired immediately.

  4. dina says:

    You can’t blame the current CEO. The problem actually started 10 years ago when NASDAQ started outsourcing to Indian companies. I have seen developers with very little experience working on Execution Systems like SuperMontage and reporting systems like ACT. It is very difficult to find IT people who are willing to work in exchanges because the pay is very low compared to banks/hedge funds. This was the reason why did not fire anyone. If you fire an idiot, you have find another idiot.

  5. PeterR says:

    The next tip of the next iceberg?

    Does this Titanic scenario ring a bell?

    http://www.marketwatch.com/story/recession-crushed-middle-class-wealth-fed-survey-2012-06-11

  6. dead hobo says:

    dina Says:
    June 11th, 2012 at 2:30 pm

    You can’t blame the current CEO.

    reply:
    ————
    Yes you can. He sets the tone at the top. These people should be coming to work every day planning on how to expand the business AND trying to figure out where ALL the impediments to progress lie to meet those plans. You can’t plan one without considering the other and assuming systems will need extreme attention to accomplish the expansion successfully. If you don’t know your weak points or choke points for a given objective, you don’t know your business. And if you ignore them, you’re an idiot. (PS, this is just basic SWOT analysis, but it takes effort and those with hubris aren’t any good at it.)

  7. ToNYC says:

    The essence of FaceBook is FaceTakes, so why not consider MogenStanled making it a verb like FaceTook ?
    The faceplant may be generic, but the facetook is forever.

  8. PeterR says:

    Graph this drop in family net worth relative to SPX from the early 1990′s!

    http://www.nytimes.com/2012/06/12/business/economy/family-net-worth-drops-to-level-of-early-90s-fed-says.html

    Another tip of another iceberg IMO.

    Mayday Mayday Mayday!

  9. rtalcott says:

    I’ve never seen a failure like this (clearly a cluster) that was not a management failure…been doing high tech start-ups for 30 years…disasters are due to management…this isn’t any different…
    rt

  10. PeterR says:

    So sorry to Dis’ Fa(r)ceBook.

    Switch the term to:

    “FARCE” about the (global) market in general.

    PS — Have you been paying attention to previous posts? [to keep the exit door in sight?]

  11. ruetheday says:

    I really don’t see the big deal. There were some issues with order confirmations for a few hours on the first day of trading. Sucks for people who were trying to get in and out that first day. Has absolutely no bearing whatsoever on why FB is trading for $27 3 weeks later. Anyone who thinks “if only we were able to get a bigger pop on the first day it would be worth a lot more now” is an idiot.

  12. VennData says:

    How DARE these… these JOURNALISTS accuse alabaster-white pillars of New York investment world of not being “in touch” …what ever THAT means. And you freaks in IT should be happy to have a job.. Ewww… you are, like, so… GROSS!

  13. Robespierre_ says:

    The fact that he flew commercial and was worrying about his phone running out of battery shows an appalling lack of contingency planning. He should have been dialed in every minute of that high profile event wherever he was. I’ve worked at mid-sized organizations where the contingency plans for much lower profile events were so clearly better than what the Nasdaq seems to have had in place for such an important event. The lack of effective planning reflects quite poorly on leadership. I say the CEO is to blame.