Today’s most popular story was Microsoft investing $240 million for a 1.6% stake in Facebook. Everyone’s gettin’ all crazy about this since the deal values Facebook at $15 billion. This is a great big important story blah blah blah. Needless to say, I’ve gotten too many emails asking what I think of this deal.
My answer: I don’t care!
This is just the latest case of the media brainwashing you to believe that this kind of deal actually matters to you. Sure, if you’re invested in Microsoft, bravo, this is a big win for them and you as an investor. If you’re an internet startup, great, now you know how successful you can become in 4 years. If you’re a TV network or media outlet, beautiful, you’ll be able to discuss this one for a long time, viewers will tune in and the ad dollars will pile up. But for individual investors and the majority of other people who don’t want to sit around investing for the longterm, it’s overwhelmingly meaningless. Kinda like that Google/YouTube deal way back when.
I know I’m sounding a little crazy so what should you focus on instead, hmmm, let’s see — how about Terra Nostra Resources Corporation (OTCBB: TNRO) down trending perfectly after a staggering runup that was caused by a whole lot of hype and promotion (I, alone, received over a dozen faxes and emails hyping this stock) and an incredible earnings report . While the earnings look great on the whole, this is an OTCBB so be cautious. Wouldn’t it be nice to be able to know how take advantage of a chart like this? (my DVD, cough, cough).
Sure, I know what you’re thinking–this only a $200 million company–smaller than the 1.6% stake Microsoft took in Facebook!–why should I care? And it’s a Penny Stock, ewwwwwwwwwwww!
Well, it’s just that this kind of play is a whole lot more predictable and if you’re gonna play the stock market, you should focus on these kinds of plays rather than huge deals and stocks that everyone and their mother are talking about. We’re here to make money int he stock market, not try to guess the future potential and valuation of internet leaders, right?
And, no, I didn’t take advantage of this play either–the process of closing a hedge fund down and transferring assets to personal accounts sucks and takes much longer than you think!
