There were a few things bothering Glenn this morning, one of them was Facebook. Facebook was valued at $60 billion more than the Disney – why? What are they creating that is so valuable? Pointing to the dot com bubble, Glenn explained that you’re not left with any tangible assets. If a company like Disney goes belly up you could sell movies, networks like ESPN, three theme parks, etc. – but with Facebook Glenn noted, “In the end, all I’m really buying is a domain name.”
Glenn, who is obviously not anti-internet or social media, made sure to point out that Facebook has obvious upsides. “900 million people connect through Facebook,” he said. “It is the wave of the future.”
Last Friday, Glenn touched on the IPO and the lunacy of the conversation that was occurring in the media over its price point – all of the “experts” were saying, “is it $100 billion or $116 billion.”
Even the president’s favorite banker Jamie Dimon at J.P. Morgan Chase was involved, as was Morgan Stanley. “The president doesn’t trust anyone on Wall Street, but he trusts these guys,” Glenn said sarcastically. "You know, Jamie Dimon and J.P. Morgan Chase, they have a million dollars of the president's own money, and they are some of the best bankers in the world right there at J.P. Morgan Chase and Jamie Dimon."
While Greece and Europe are in turmoil and the Euro is on the brink, the mainstream media completely shifted focus to …Facebook? Really? There were a very small handful of people that point to the fact that a lot people could lose a lot of money on this.
Surprise, surprise, there were a few facts that most people didn’t hear about last week regarding Facebook. Like the way the IPO was evaluated, or that the guy who did the IPO for Facebook is the same guy who did the IPO for General Motors for the government. General Motors also came out last week and said they were ending all of their advertising with Facebook and the Super Bowl. Glenn said that the reason given by GM was “it’s pricey” and “it doesn’t work.”
“Okay, wait a minute,” Glenn started, “Hand on just a second. 900 million people connect on Facebook. You’re going to get out of the Facebook business, General Motors… Government Motors? And then you’re going to get out of the Super Bowl? So your advertising executives are third graders, you’re broke, or something else is going on.”
At first Glenn thought that General Motors was just broke, but then after taking a step back to look at the big picture, the Facebook issue stood out at him. “Everybody is on the bandwagon except General Motors? Why is that? Why are they getting out of the Facebook business, while everybody on the planet is going this direction?” Glenn asked.
Glenn noted that unless Facebook increases its revenue by 47% for the next three years it will collapse – something that nobody talked about last week. Now it’s being reported that the banks made about $100 million off of this, and now the left is coming out against Facebook and demonizing them.
“I thought these were the greatest people ever? I thought the president loved these guys?” Glenn asked. “I thought the president said how great Facebook was because it was leading ‘change’ – people were connecting with it all over the world and it was the leader in revolution? He held a rally at Facebook and now, all of a sudden, they’re evil? Huh.”
Experts are also coming out now and saying that this could be the Black Swan event if Facebook doesn’t make their 47% increase in profit for the next three years. It could implode and bring down the entire economy.
Glenn pointed out that, like most people, if everything did crash, he’d rather have a roller coaster and the assets of Disney, but the government on the other hand, what would they rather have in their pocket in the event of a market and/or economic collapse?
“If I was the government, wouldn't that be great to have an asset like Facebook?” Glenn asked. Especially if you had the kind of ideas of Cass Sunstein or Mark Lloyd where you needed to control the media? Well, this is the new media. Wouldn't it be great? Think of the money we could save. Think of the money we could save, because remember one of the first things that Barack Obama did is say, "I've got to archive all of the Facebook posts. I've got to archive all of those because it's so important to our culture. What do you think of the money we'll save in the archives, if we just helped them or bailed them out – had access, had control?" What a great asset that would be for the United States of America.”