May the source be with you, but remember the KISS principle ;-)
Home Switchboard Unix Administration Red Hat TCP/IP Networks Neoliberalism Toxic Managers
(slightly skeptical) Educational society promoting "Back to basics" movement against IT overcomplexity and  bastardization of classic Unix

Many faces of Facebook

News Social Sites as intelligence collection tools Recommended Links Facebook as Giant Database about Users IPO Competition with Google+
PHP as Visual Basic of the Web Total control: keywords in your posts that might trigger surveillance Mark Zukenberg Google sites Prizm-related humor Etc

Facebook is social networking site for Internet red necks. People have been communicating with each other for about 6 years now, making Facebook the largest database about users with over 350 million users worldwide. See Social Sites as intelligence collection tools

As  Raul Ilargi Meije noted ( Google & Facebook Are 1984 ):

As Google, Facebook and the CIA are ever more entwined, these companies become so important to what 'the spooks' consider the interests of the nation that they will become mutually protective. And once CIA headquarters in Langley, VA, aka the aptly named "George Bush Center for Intelligence", openly as well as secretly protects you, you're pretty much set for life. A long life.

While many people include Youtube into the list of "evil" social sites, I would not put Youtube in the same set of social sites as Facebook. This is a different platform. And much more useful. No respectful person that I know uses Facebook for putting personal information on it.  Only most stupid teenagers are doing that. And even among them resentment against Facebook is common.

Google  with its search engine is a more dangerous beast, but there are alternatives. many people stitched for Google to other search engines.  That does not give much privacy protection other then moral satisfaction, but still it is stupid just to use Big Brother search engine voluntarily if you can avoid it.


At the front end, their servers run LAMP stack (Linux, Apache, MySQL, and PHP) with Memcache (they have become the largest user of this technology).

Facebook’s backend services are written in a variety of different programming languages including C++, Java, Python, and Erlang. It is mostly closed source. Their philosophy for the creation of services is as follows:

  1. Create a service if needed
  2. Create a framework/toolset for easier creation of services
  3. Use the right programming language for the task

There are some open source projects as well. A list of  Facebook’s open source developments can be found  at Open Source - Facebook Developers Among them:

Developer tools

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Old News ;-)

Peak FaceBook?

Tyler Durden on 04/22/2015 16:45 -0400

Remember MySpace? No? You are not the only one: apparently nobody else does (even though it did sell for a token price to a greater fool).

What about Friendster? Also no? Hardly surprising either.

Of course, both of these social networks are dead and buried, with Facebook gleefully dancing on their grave, a Facebook, or rather FB, which went public on May 18, 2012. A curious date we should note, because as we showed on that very day, the underwriters decided to go public just as Google Trends showed interest in Facebook was at its very peak.

So, where are we now? It depends who you ask. On one hand, according to the company, and the way it counts eyeballs, pardon Monthly Active Users, things have never been better, with some 1.441 billion MAUs, of which 210 million in just the US and Canada, or more than the entire employed population in those two nations.

What about earnings? Well, there too it depends which accountant you ask: one who believes that GAAP earnings matter, and that share-based compensation (whose proceeds are all too real and allow employees to buy any number of GDP-boosting products and services) is actually an item that should be counted toward one's bottom line. Or that they shouldn't.

Because in the latest quarter, non-GAAP Net Income was more than double GAAP.

But the reason one can't help but wonder just how much of FB's "users" are merely robotic autoclicks and/or originate at various clickfarms somewhere in Asia, is that taking the Google Trends chart posted above, and refreshing it as of today, reveals something troubling.

That something is whether, despite the company's loud protests to the contrary, that Facebook's peak has come and gone, and what remains is the MySpace/Friendster inevitable supernova as Facebook's easily distracted users go on to cooler, newer venues.

Luckily, there is an easy way to find out: if the company folds and admits the growth cycle is finished, and begins to repurchase its own shares courtesy of one of the few largely pristine balance sheets remaining, then it may be time to log off for good.

[Dec 03, 2017] Google Facebook Are 1984 - Tax Them 'Til They Bleed by Raul Ilargi Meije

I would not put YouTube in the same set of Facebook. This is a different platform. And much more useful. IMHO no respectful person that I know uses Facebook for putting personal information on it. Only teenagers are doing that. And even among them resentment against Facebook is common.
Google with its search engine is a more dangerous beast, but there are alternatives. many people stitched for Google to other search engines. That does not give much privacy protection other then moral satisfaction, but still it is stupid just to use Big Brother search engine voluntarily if you can avoid it.
Notable quotes:
"... For Google and Facebook as the world's new major -only?!- ad agencies: Tax the heebies out of them or forbid them from running any ads at all. Why? Because they extract enormous amounts of productive capital from society. Capital they, as Varoufakis says, do not even themselves create. ..."
"... As Google, Facebook and the CIA are ever more entwined, these companies become so important to what 'the spooks' consider the interests of the nation that they will become mutually protective. And once CIA headquarters in Langley, VA, aka the aptly named "George Bush Center for Intelligence", openly as well as secretly protects you, you're pretty much set for life. A long life. ..."
"... I know, you were thinking it was 'the Russians' with a few as yet unproven bucks in Facebook ads that were threatening US and European democracies. Well, you're really going to have to think again. ..."
Nov 12, 2017 |
Authoredr via The Automatic Earth blog,

An entire library of articles about Big Tech is coming out these days, and I find that much of it is written so well, and the ideas in them so well expressed, that I have little to add. Except, I think I may have the solution to the problems many people see. But I also have a concern that I don't see addressed, and that may well prevent that solution from being adopted. If so, we're very far away from any solution at all. And that's seriously bad news.

Let's start with a general -even 'light'- critique of social media by Claire Wardle and Hossein Derakhshan for the Guardian:

How Did The News Go 'Fake'? When The Media Went Social

Social media force us to live our lives in public , positioned centre-stage in our very own daily performances. Erving Goffman, the American sociologist, articulated the idea of "life as theatre" in his 1956 book The Presentation of Self in Everyday Life, and while the book was published more than half a century ago, the concept is even more relevant today. It is increasingly difficult to live a private life, in terms not just of keeping our personal data away from governments or corporations, but also of keeping our movements, interests and, most worryingly, information consumption habits from the wider world.

The social networks are engineered so that we are constantly assessing others – and being assessed ourselves. In fact our "selves" are scattered across different platforms, and our decisions, which are public or semi-public performances, are driven by our desire to make a good impression on our audiences, imagined and actual. We grudgingly accept these public performances when it comes to our travels, shopping, dating, and dining. We know the deal. The online tools that we use are free in return for us giving up our data, and we understand that they need us to publicly share our lifestyle decisions to encourage people in our network to join, connect and purchase.

But, critically, the same forces have impacted the way we consume news and information. Before our media became "social", only our closest family or friends knew what we read or watched, and if we wanted to keep our guilty pleasures secret, we could. Now, for those of us who consume news via the social networks, what we "like" and what we follow is visible to many [..] Consumption of the news has become a performance that can't be solely about seeking information or even entertainment. What we choose to "like" or follow is part of our identity, an indication of our social class and status, and most frequently our political persuasion.

That sets the scene. People sell their lives, their souls, to join a network that then sells these lives -and souls- to the highest bidder, for a profit the people themselves get nothing of. This is not some far-fetched idea. As noted further down, in terms of scale, Facebook is a present day Christianity. And these concerns are not only coming from 'concerned citizens', some of the early participants are speaking out as well. Like Facebook co-founder Sean Parker:

Facebook: God Only Knows What It's Doing To Our Children's Brains

Sean Parker, the founding president of Facebook, gave me a candid insider's look at how social networks purposely hook and potentially hurt our brains. Be smart: Parker's I-was-there account provides priceless perspective in the rising debate about the power and effects of the social networks, which now have scale and reach unknown in human history. [..]

"When Facebook was getting going, I had these people who would come up to me and they would say, 'I'm not on social media.' And I would say, 'OK. You know, you will be.' And then they would say, 'No, no, no. I value my real-life interactions. I value the moment. I value presence. I value intimacy.' And I would say, 'We'll get you eventually.'"

"I don't know if I really understood the consequences of what I was saying, because [of] the unintended consequences of a network when it grows to a billion or 2 billion people and it literally changes your relationship with society, with each other It probably interferes with productivity in weird ways. God only knows what it's doing to our children's brains."

"The thought process that went into building these applications, Facebook being the first of them, was all about: 'How do we consume as much of your time and conscious attention as possible?'" "And that means that we need to sort of give you a little dopamine hit every once in a while, because someone liked or commented on a photo or a post or whatever. And that's going to get you to contribute more content, and that's going to get you more likes and comments."

"It's a social-validation feedback loop exactly the kind of thing that a hacker like myself would come up with, because you're exploiting a vulnerability in human psychology." "The inventors, creators -- it's me, it's Mark [Zuckerberg], it's Kevin Systrom on Instagram, it's all of these people -- understood this consciously. And we did it anyway."

Early stage investor in Facebook, Roger McNamee, also has some words to add along the same lines as Parker. They make it sound like they're Frankenstein and Facebook is their monster.

How Facebook and Google Threaten Public Health – and Democracy

The term "addiction" is no exaggeration. The average consumer checks his or her smartphone 150 times a day, making more than 2,000 swipes and touches. The applications they use most frequently are owned by Facebook and Alphabet, and the usage of those products is still increasing. In terms of scale, Facebook and YouTube are similar to Christianity and Islam respectively. More than 2 billion people use Facebook every month, 1.3 billion check in every day. More than 1.5 billion people use YouTube. Other services owned by these companies also have user populations of 1 billion or more.

Facebook and Alphabet are huge because users are willing to trade privacy and openness for "convenient and free." Content creators resisted at first, but user demand forced them to surrender control and profits to Facebook and Alphabet. The sad truth is that Facebook and Alphabet have behaved irresponsibly in the pursuit of massive profits. They have consciously combined persuasive techniques developed by propagandists and the gambling industry with technology in ways that threaten public health and democracy.

The issue, however, is not social networking or search. It is advertising business models. Let me explain. From the earliest days of tabloid newspapers, publishers realized the power of exploiting human emotions. To win a battle for attention, publishers must give users "what they want," content that appeals to emotions, rather than intellect. Substance cannot compete with sensation, which must be amplified constantly, lest consumers get distracted and move on. "If it bleeds, it leads" has guided editorial choices for more than 150 years, but has only become a threat to society in the past decade, since the introduction of smartphones.

Media delivery platforms like newspapers, television, books, and even computers are persuasive, but people only engage with them for a few hours each day and every person receives the same content. Today's battle for attention is not a fair fight. Every competitor exploits the same techniques, but Facebook and Alphabet have prohibitive advantages: personalization and smartphones. Unlike older media, Facebook and Alphabet know essentially everything about their users, tracking them everywhere they go on the web and often beyond.

By making every experience free and easy, Facebook and Alphabet became gatekeepers on the internet, giving them levels of control and profitability previously unknown in media. They exploit data to customize each user's experience and siphon profits from content creators. Thanks to smartphones, the battle for attention now takes place on a single platform that is available every waking moment. Competitors to Facebook and Alphabet do not have a prayer.

Facebook and Alphabet monetize content through advertising that is targeted more precisely than has ever been possible before . The platforms create "filter bubbles" around each user, confirming pre-existing beliefs and often creating the illusion that everyone shares the same views. Platforms do this because it is profitable. The downside of filter bubbles is that beliefs become more rigid and extreme. Users are less open to new ideas and even to facts.

Of the millions of pieces of content that Facebook can show each user at a given time, they choose the handful most likely to maximize profits. If it were not for the advertising business model, Facebook might choose content that informs, inspires, or enriches users. Instead, the user experience on Facebook is dominated by appeals to fear and anger. This would be bad enough, but reality is worse.

And in a Daily Mail article, McNamee's ideas are taken a mile or so further. Goebbels, Bernays, fear, anger, personalization, civility.

Early Facebook Investor Compares The Social Network To Nazi Propaganda

Facebook officials have been compared to the Nazi propaganda chief Joseph Goebbels by a former investor. Roger McNamee also likened the company's methods to those of Edward Bernays, the 'father of public' relations who promoted smoking for women. Mr McNamee, who made a fortune backing the social network in its infancy, has spoken out about his concern about the techniques the tech giants use to engage users and advertisers. [..] the former investor said everyone was now 'in one degree or another addicted' to the site while he feared the platform was causing people to swap real relationships for phoney ones.

And he likened the techniques of the company to Mr Bernays and Hitler's public relations minister. 'In order to maintain your attention they have taken all the techniques of Edward Bernays and Joseph Goebbels, and all of the other people from the world of persuasion, and all the big ad agencies, and they've mapped it onto an all day product with highly personalised information in order to addict you,' Mr McNamee told The Telegraph. Mr McNamee said Facebook was creating a culture of 'fear and anger'. 'We have lowered the civil discourse, people have become less civil to each other..'

He said the tech giant had 'weaponised' the First Amendment to 'essentially absolve themselves of responsibility'. He added: 'I say this as somebody who was there at the beginning.' Mr McNamee's comments come as a further blow to Facebook as just last month former employee Justin Rosenstein spoke out about his concerns. Mr Rosenstein, the Facebook engineer who built a prototype of the network's 'like' button, called the creation the 'bright dings of pseudo-pleasure'. He said he was forced to limit his own use of the social network because he was worried about the impact it had on him.

As for the economic, not the societal or personal, effects of social media, Yanis Varoufakis had this to say a few weeks ago:

Capitalism Is Ending Because It Has Made Itself Obsolete – Varoufakis

Former Greek finance minister Yanis Varoufakis has claimed capitalism is coming to an end because it is making itself obsolete. The former economics professor told an audience at University College London that the rise of giant technology corporations and artificial intelligence will cause the current economic system to undermine itself. Mr Varoufakis said companies such as Google and Facebook, for the first time ever, are having their capital bought and produced by consumers.

"Firstly the technologies were funded by some government grant; secondly every time you search for something on Google, you contribute to Google's capital," he said. "And who gets the returns from capital? Google, not you. "So now there is no doubt capital is being socially produced, and the returns are being privatised . This with artificial intelligence is going to be the end of capitalism."

Ergo, as people sell their lives and their souls to Facebook and Alphabet, they sell their economies along with them.

That's what that means. And you were just checking what your friends were doing. Or, that's what you thought you were doing.

The solution to all these pains is, likely unintentionally, provided by Umair Haque's critique of economics. It's interesting to see how the topics 'blend', 'intertwine'.

How Economics Failed the Economy

When, in the 1930s, the great economist Simon Kuznets created GDP, he deliberately left two industries out of this then novel, revolutionary idea of a national income : finance and advertising. [..] Kuznets logic was simple, and it was not mere opinion, but analytical fact: finance and advertising don't create new value , they only allocate, or distribute existing value in the same way that a loan to buy a television isn't the television, or an ad for healthcare isn't healthcare. They are only means to goods, not goods themselves. Now we come to two tragedies of history.

What happened next is that Congress laughed, as Congresses do, ignored Kuznets, and included advertising and finance anyways for political reasons -after all, bigger, to the politicians mind, has always been better, and therefore, a bigger national income must have been better. Right? Let's think about it. Today, something very curious has taken place.

If we do what Kuznets originally suggested, and subtract finance and advertising from GDP, what does that picture -a picture of the economy as it actually is reveal? Well, since the lion's share of growth, more than 50% every year, comes from finance and advertising -whether via Facebook or Google or Wall St and hedge funds and so on- we would immediately see that the economic growth that the US has chased so desperately, so furiously, never actually existed at all.

Growth itself has only been an illusion, a trick of numbers, generated by including what should have been left out in the first place. If we subtracted allocative industries from GDP, we'd see that economic growth is in fact below population growth, and has been for a very long time now, probably since the 1980s and in that way, the US economy has been stagnant, which is (surprise) what everyday life feels like. Feels like.

Economic indicators do not anymore tell us a realistic, worthwhile, and accurate story about the truth of the economy, and they never did -only, for a while, the trick convinced us that reality wasn't. Today, that trick is over, and economies grow , but people's lives, their well-being, incomes, and wealth, do not, and that, of course, is why extremism is sweeping the globe. Perhaps now you begin to see why the two have grown divorced from one another: economics failed the economy.

Now let us go one step, then two steps, further. Finance and advertising are no longer merely allocative industries today. They are now extractive industries. That is, they internalize value from society, and shift costs onto society, all the while creating no value themselves.

The story is easiest to understand via Facebook's example: it makes its users sadder, lonelier, and unhappier, and also corrodes democracy in spectacular and catastrophic ways. There is not a single upside of any kind that is discernible -and yet, all the above is counted as a benefit, not a cost, in national income, so the economy can thus grow, even while a society of miserable people are being manipulated by foreign actors into destroying their own democracy. Pretty neat, huh?

It was BECAUSE finance and advertising were counted as creative, productive, when they were only allocative, distributive that they soon became extractive. After all, if we had said from the beginning that these industries do not count, perhaps they would not have needed to maximize profits (or for VCs to pour money into them, and so on) endlessly to count more. But we didn't.

And so soon, they had no choice but to become extractive: chasing more and more profits, to juice up the illusion of growth, and soon enough, these industries began to eat the economy whole, because of course, as Kuznets observed, they allocate everything else in the economy, and therefore, they control it.

Thus, the truly creative, productive, life-giving parts of the economy shrank in relative, and even in absolute terms, as they were taken apart, strip-mined, and consumed in order to feed the predatory parts of the economy , which do not expand human potential. The economy did eat itself, just as Marx had supposed – only the reason was not something inherent in it, but a choice, a mistake, a tragedy.

[..] Life is not flourishing, growing, or developing in a single way that I or even you can readily identify or name. And yet, the economy appears to be growing, because purely allocative and distributive enterprises like Uber, Facebook, credit rating agencies, endless nameless hedge funds, shady personal info brokers, and so on, which fail to contribute positively to human life in any discernible way whatsoever, are all counted as beneficial. Do you see the absurdity of it?

[..] It's not a coincidence that the good has failed to grow, nor is it an act of the gods. It was a choice. A simple cause-effect relationship, of a society tricking itself into desperately pretending it was growing, versus truly growing. Remember not subtracting finance and advertising from GDP, to create the illusion of growth? Had America not done that, then perhaps it might have had to work hard to find ways to genuinely, authentically, meaningfully grow, instead of taken the easy way out, only to end up stagnating today, and unable to really even figure out why yet.

Industries that are not productive, but instead only extract money from society, need to be taxed so heavily they have trouble surviving. If that doesn't happen, your economy will never thrive, or even survive. The whole service economy fata morgana must be thrown as far away as we can throw it. Economies must produce real, tangible things, or they die.

For the finance industry this means: tax the sh*t out of any transactions they engage in. Want to make money on complex derivatives? We'll take 75+%. Upfront. And no, you can't take your company overseas. Don't even try.

For Uber and Airbnb it means pay taxes up the wazoo, either as a company or as individual home slash car owners. Uber and Airbnb take huge amounts of money out of local economies, societies, communities, which is nonsense, unnecessary and detrimental. Every city can set up its own local car- or home rental schemes. Their profits should stay within the community, and be invested in it.

For Google and Facebook as the world's new major -only?!- ad agencies: Tax the heebies out of them or forbid them from running any ads at all. Why? Because they extract enormous amounts of productive capital from society. Capital they, as Varoufakis says, do not even themselves create.

YOU are creating the capital, and YOU then must pay for access to the capital created.

Yeah, it feels like you can just hook up and look at what your friends are doing, but the price extracted from you, your friends, and your community is so high you would never volunteer to pay for it if you had any idea.

The one thing that I don't see anyone address, and that might prevent these pretty straightforward "tax-them-til they-bleed!" answers to the threat of New Big Tech, is that Facebook, Alphabet et al have built a very strong relationship with various intelligence communities. And then you have Goebbels and Bernays in the service of the CIA.

As Google, Facebook and the CIA are ever more entwined, these companies become so important to what 'the spooks' consider the interests of the nation that they will become mutually protective. And once CIA headquarters in Langley, VA, aka the aptly named "George Bush Center for Intelligence", openly as well as secretly protects you, you're pretty much set for life. A long life.

Next up: they'll be taking over entire economies, societies. This is happening as we speak . I know, you were thinking it was 'the Russians' with a few as yet unproven bucks in Facebook ads that were threatening US and European democracies. Well, you're really going to have to think again.

The world has never seen such technologies. It has never seen such intensity, depth of, or such dependence on, information. We are simply not prepared for any of this. But we need to learn fast, or become patsies and slaves in a full blown 1984 style piece of absurd theater. Our politicians are AWOL and MIA for all of it, they have no idea what to say or think, they don't understand what Google or bitcoin or Uber really mean.

In the meantime, we know one thing we can do, and we can justify doing it through the concept of non-productive and extractive industries. That is, tax them till they bleed.

That we would hit the finance industry with that as well is a welcome bonus. Long overdue. We need productive economies or we're done. And Facebook and Alphabet -and Goldman Sachs- don't produce d*ck all.

When you think about it, the only growth that's left in the US economy is that of companies spying on American citizens. Well, that and Europeans. China has banned Facebook and Google. Why do you think they have? Because Google and Facebook ARE 1984, that's why. And if there's going to be a Big Brother in the Middle Kingdom, it's not going to be Silicon Valley.

[Mar 14, 2015] Silicon Valley's Web of Lies by Christine Rosen

"Instead of a win-win, the Internet is, in fact, more akin to a negative feedback loop in which we network users are its victims rather than beneficiaries,"
February 26, 2015 | The National Interest

Andrew Keen, The Internet Is Not the Answer (New York: Atlantic Monthly Press, 2015), 288 pp., $25.00.

DURING THE past few years, if you were one of the many people trawling the dating website OkCupid in search of love, you might have received a notice letting you know it had found someone who was an "exceptionally good" match for you. You might have contacted this match and even gone on dates with this person, comfortable in the knowledge that a sophisticated algorithm had done the difficult work of sorting through millions of profiles to find someone with just the right balance of appealing quirks and concupiscent charms to match your own delightful attributes.

What you didn't know is that OkCupid was experimenting on you. Engineers programmed the site to send its users matches that it claimed were "exceptional" but that were in fact bogus-all for the purpose of finding out if you would believe the assessment and pursue the match. Not surprisingly, most users did. We are nothing if not suggestible when it comes to love, even if Cupid's arrow has been replaced by OkCupid's algorithm.

This past summer, Christian Rudder, the founder of OkCupid, was prompted to publicize his company's manipulation of its users in response to the furor created by Facebook's acknowledgement that it, too, often uses the social network as a massive online behavioral-science experiment. In January 2012, more than half a million Facebook users became unwitting lab rats when the company deliberately massaged its users' news feeds by putting either more or less positive information in them, ostensibly to determine if emotions are "contagious." (Short answer: yes, but behavioral science had already proven this; Facebook, by contrast, was not doing this for science. The company wanted to show advertisers that it could manipulate its users.)

For a brief moment, as news of these experiments became public, we caught a glimpse of the chasm that has developed between what technology companies like Facebook and OkCupid assume about their users and how those users actually feel. Some OkCupid devotees were horrified to learn that the site keeps not only every single message sent to a potential date, but also bits of messages erased while trying to craft a perfectly pitched response. The users felt, well, used. Rudder was unmoved. As one of his OkCupid blog posts boasted, "We Experiment On Human Beings!"

Both the public's brief outrage and the hubris of the technology companies would come as no surprise to Andrew Keen, whose new book, The Internet Is Not the Answer, offers a critical narrative of the various ways Silicon Valley is reshaping the world's economy and values-and not for the better. "Instead of a win-win, the Internet is, in fact, more akin to a negative feedback loop in which we network users are its victims rather than beneficiaries," Keen writes. "Rather than the answer, the Internet is actually the central question about our connected twenty-first-century world."

Keen states outright that his book is a synthesis, and it contains both the benefits and drawbacks of one-repetitive and larded with quotations, it mainly advances arguments that have been made already (and in greater depth) by technology critics such as Jaron Lanier, Sherry Turkle and Nicholas Carr. Withal, he provides a timely and necessary overview of how the Internet arrived at its present state and a bracing polemic about where it's headed. If, as MIT Media Lab director Joi Ito once said, "The Internet is not a technology; it's a belief system," then Andrew Keen is one of its more compelling heretics.

SOMETIME AROUND 1989, Keen argues, when computer scientist Tim Berners-Lee sketched the early outline for the World Wide Web, the world changed. This new world, defined by the Internet's expansion, is one that has "created new values, new wealth, new debates, new elites, new scarcities, new markets, and above all, a new kind of economy." It is a world where, as a recent United Nations report noted, more people have cell phones than access to functioning toilets.

Many early Internet champions believed that the Web they were building would connect people in a way that would inaugurate an era of creative, cooperative economic and technological development. Technologists such as Berners-Lee and Robert Kahn had backgrounds in research science and academia; they were not focused on the potential profitability of their enterprise. Once the U.S. government opened up the Internet to commercial use in the early 1990s, however, Keen shows how it "triggered the rush by a new class of technological oligarchs in the United States to acquire prime online real estate."

In Keen's telling, the story of the Internet can be "summarized in a single word: money." One of the creators of the early Web browser Netscape captured the mood well when he said, "The hell with the commune. This was business."

But it is business that, for all of its rhetoric about innovation and disruption, has taken a traditional form. The online world is now dominated by a small group of big companies-Google, Amazon, Apple and Facebook foremost among them-that function like the monopolies of old. One technology investor whom Keen cites puts it this way: "The Internet, in its current form, has simply replaced the old boss with a new boss and these new bosses have market power that, in time, will be vastly larger than that of the old boss."

[Sep 05, 2012] Bull Markets Die Hard, Here's How This One Could End Breakout

Correction can well be 50%. When it will come nobody knows... Schatz sees this bull market drying up in 2013 or possibly into 2014. He advises watching for deterioration in market leaders Apple, Google, and Amazon as the first warnings of the next downturn.
Yahoo! Finance

September is kicking off with a whimper after the release of U.S. and Chinese manufacturing data and Moody's (MCO) warning of a rating downgrade for the European Union. The U.S. ISM reading ticked down to 49.6% in August, versus an expected 50.2%. China's official Purchasing Manager's Index slid to 49.2 in August from 50.1 in July. For both measures, below 50 indicates manufacturing activity contracted.

The market will likely tread water ahead of some big events later this week including an ECB meeting on Thursday and the U.S. employment report on Friday.

Regardless of these short-term, potentially market-moving events, investor Paul Schatz, president of Heritage Capital says this bull market is running out of steam and a few strong stocks have been masking that reality.

Schatz calls Apple (AAPL), Google (GOOG), and Amazon (AMZN) the generals of the market holding up the major indices, particularly and obviously the Nasdaq (^IXIC). While these stocks are posting gains for outpacing the broader market since the start of the bull run in 2009, in his opinion, investors are fleeing other areas of the market.

"Bull markets die hard, at the end this is what happens," he says.

Here's how the major indices stack up against the stock trio since early March 2009:


"It doesn't end well," he predicts. "If you look at historical examples, the story stocks are hit anywhere from mildly 30%, and in a bad case like we saw in '07 to '09, 60 or 70%."

Schatz sees this bull market drying up in 2013 or possibly into 2014. He advises watching for deterioration in market leaders Apple, Google, and Amazon as the first warnings of the next downturn.

Is the bull market story over? Let us know your thoughts in the comment section below or visit us on Facebook.


The periods in between crises are getting shorter. 2001-2008, 2008-2011, 2011-2013. The first crash was mostly American, the second one mostly European, the third one will be worldwide. A perfect storm of unresolved issues around the globe.


When the Fed can no longer print dollars to finance the US Gov's enormous debt issues because fools no longer with accept a negative return the jig is up. As long as the perception of low infation can be maintained the game can run.

Dave K

Bull markets die hard, Bullsh_t markets go out in a puff of smoke.


There seems to be a total dis connect between wall street and main street. I think part of that is due to the fact that the people on main street are dealing with real time problems that wall street is not giving full weight to.


May and John, are you morons, imbeciles, or idiots? There is no more $ pouring into 401Ks and pension funds GOING to wall street investments. People are on to the game and choose to pay down debt and make the most of their money. The little guy has left wall street to computers and foreign money.


Our National Public Debt is killing us. People, this is YOUR DEBT. Every man, women and child owes over $50,000. Every taxpayer owes over $140,000. Factor in unfunded liabilities and it rises to $1.4 MILLION. We are in a depression and will fully realize it soon.

The stock market is not a market. Just as the bond market is not a market. Both, and most other markets, are overtly and covertly manipulated by the FED and anyone keeping an eye on the ball knows it.

[Jul 25, 2012] Did Lloyd Blankfein just call the top of the tech bubble

April 26, 2012 |

Say what you will about Lloyd Blankfein, the CEO of Goldman Sachs, but for all his failings he's probably quite intelligent. Here's what he said in response to a question on the upcoming Facebook IPO from Eric Schatzker of Bloomberg TV. (Hat tip to Barry Ritholtz at The Big Picture):

If we ever added an S to the end of BRIC to make it BRICS, you might have to throw Silicon Valley in there.

Goldman, as you might know, is the firm that invented the BRIC acronym. Sorry, South Africa. Looks like the geeks beat you to it.

But did Lloyd just call the top of a new tech bubble? The main question that seems to be on the lips of everyone in the tech scene (and a good many people outside of it) is, "Are we or aren't we in a tech bubble?" Arguments tend to break down as follows:

In every market prices rise and fall, like a sine wave. Prices are kind of high now. They'll probably go down in the future, right? But high prices is not a bubble. A bubble is like a mania, right? I mean, people are thinking, "I gotta get in or I'll get left behind", right? And I don't feel that people are thinking that now [...] I mean, I was there for the first bubble and that was a mania!

The truth is that the technology sector as a whole over any length of time is a positive-sum game even if the economy doesn't grow at all, because it is taking business away from other industries (i.e. those other industries will experience negative gains adjusted for population growth; that is, they are shrinking in relation to everything else). A retraction of investment interest in this will slow but not stop the disruption.

But maybe the best, final word on this topic comes from an informal poll on Hacker News, which is a sort of Reddit for tech geeks.

As you can see the majority, about 72%, think that things are looking pretty bubblelicious.

[May 23, 2012] The Inside Story Of What Happened On The Facebook IPO

Business Insider

And now for some more bombshell news about the Facebook IPO...
Earlier, we reported that the analysts at Facebook's IPO underwriters had cut their estimates for the company in the middle of the IPO roadshow, a highly unusual and negative event.
What we didn't know was why.
Now we know.
The analysts cut their estimates because a Facebook executive told them to, a source tells us.
The information about the estimate cut was then verbally conveyed to sophisticated institutional investors who were considering buying Facebook stock, but not to smaller investors.


but not to smaller investors


All f#cked.


Why is everyone so negative today? Don't tell me everyone on here is long FB?!?!?

I have 200 shares of FB. My wife egged me into buying it -- so I'll blame it on her. I told her -- well look at the bright side, we can only lose about $8K.


I told her -- well look at the bright side, we can only lose about $8K.

This is why I have an imaginary trading account.

Which reminds me, VXX, which was up 35% for the month, is now only up 25%.

Outsider :

What if the SEC imposed larger fines?

That would send a message (a weak one, but one):

"Would you like fines with that?"


Sheryl Sandberg - Wikipedia, the free encyclopedia

-Prior to Google, Sandberg served as chief of staff for the United States Department of the Treasury. -While at Harvard, Sandberg met then professor Larry Summers who became her mentor and thesis adviser. -in March 2008 Facebook announced hiring Sheryl Sandberg away from Google. After joining the company, Sandberg quickly began trying to figure out how to make Facebook profitable.


[May 22, 2012] Did Morgan Stanley Botch the Facebook IPO by SUZANNE MCGEE

May 22, 2012 | The Fiscal Times

Meanwhile, there was plenty of information out there to make an investor become more wary about Facebook at the kind of valuation underwriters were seeking. Even before General Motors (GM) announced its decision to yank all its spending on Facebook because its ads there weren't attracting new customers, the financials made it clear that the company's growth rate was slowing. There simply aren't that many people left for most of us to "friend," and it seems that we don't like being pitched vacation villa rentals or liposuction treatments when we're trying to chat with those we have "friended."

Reuters Breakingviews published a detailed analysis of the company, its financial position and its strategy that was available for at least two weeks before the IPO as an e-book. In it, the authors concluded that the company likely had a fair value closer to $65 billion than the $104 billion price tag it commanded on the IPO date. Everyone vying for stock in the company last week could have paused to read and think that through instead of being caught up in the hype.

Similarly, Facebook could have avoided being caught up in its own hype. The company, as the premier social-networking company out there and subject of an Oscar-nominated feature film, was always going to be an iconic IPO. It didn't need to be valued at quadruple the level that Google was when the latter made its debut on the public markets in 2004. The company has plenty of savvy backers and employees who were in a position to say, "Waaaait just a second. Let's be sure this is handled properly, so that the stock not only fetches the maximum possible price." Sure, those insiders who sold as part of the deal wanted to maximize their return too. But most of them own more stock in the company that they likely will find themselves trying to sell at lower and lower prices, as lockups are removed in three to six months' time. They could have said "no" when Morgan Stanley and other underwriters suggested raising the size and price, if that is what happened. Or they could have refrained from asking underwriters to make those changes, if that's the way the scenario played out.

[Feb 04, 2012] Is Facebook's IPO an exit strategy? By Ken Hess

February 2, 2012

Summary: There's money to be made on Facebook's IPO but is it a long-term investment? I don't think so but there's much to consider.

It's no secret that I'm not a huge Facebook fan. All you have to do is read some of my other posts on the topic. I think Facebook's IPO comes at a time when Facebook is on its way out–out of our lives and out of our gadgetry–for good. I believe that a lot of people have discovered that it's a waste of time and computing resources. It was cute for a while but now, they're trying to rekindle interest in this juvenile phenomenon by issuing this IPO. It's silly but it will make megamillionaires and billionaires out of people who aren't qualified to deliver pizza. Crazy stuff, that.

I think the IPO is a last ditch effort to breathe life into a failing concern. But, it won't work. Not for long anyway. I think people will wake up and say to themselves, "OMG, I have invested in something that doesn't really exist except in Cyberspace. I've…I've…invested in AIR!"

They'll wisely pull their money out and Facebook will fall to the wayside.

Goodbye and good riddance.

Although I hate Facebook and I think that the IPO is really just a money grab for those who own stock, let me add this: If I had stock in Facebook, I'd sell it as soon as possible and retire comfortably on my ridiculously gotten gain. Yes, I'd be on the phone to the broker and say, "Show me the money, baby, I am outta here."

I don't trust the stock market. I've seen fortunes lost in it. It's the same logic that keeps me out of the casinos. Sure, some people win but the losers far outnumber the winners. I don't like to lose so I don't play and I never bet unless it's a sure thing–and it never is. But, if I were the guy who painted that mural at Facebook and today he might be worth $200 million dollars, I'd take the money and run.

However, there will be people who ride it all the way to the bottom.

I can't wait to hear the "analysts" discuss Facebook's meteoric rise and fall. Everyone will give their roundtable spins as to the whys and hows and no one will remember this humble prediction. Except for me, that is.

Years ago Zuckerberg had an offer on the table for a couple billion dollars for Facebook. He didn't sell it. I would have. He held on. People don't know when to let go. Of course, he stands to make billions more now but my guess is that either he'll ride it to the bottom and end up with almost nothing or he'll wisely bail on it. The smart people involved will use this IPO bubble as an exit strategy out of a dying animal's carcass.

My advice is that if you have Facebook stock that you should cash it in because it will never be worth more than it is right now.

Why? Because it's a silly social network thing. It's false, people. There's no value in it. It's a bunch of blips on a computer screen. It's a false way to be "social." It's the latest MySpace.

Be smart, don't gamble your underfunded retirement on it. If you get the twinge to do it, think about Enron, WorldCom and so many others. Also, think about MySpace. MySpace was "all the rage" a few years ago. Now, you couldn't sell it for the electricity it burns up. A few years ago, everyone had a MySpace page. You had to have one or you didn't really exist. That's Facebook.

Facebook and the rest of "social" media is basically a scrolling wall onto which you "spray" your graffiti. It's now an acceptable form of communication. By acceptable, I mean accepted but pointless.

... ... ...

[Jan 30, 2012] With friends like Facebook, who needs sociopaths by John Naughton

Jan 28, 2012 | The Guardian

The truth is that companies such as Facebook are basically the corporate world's equivalent of sociopaths, that is to say individuals who are completely lacking in conscience and respect for others.

In her book The Sociopath Next Door, Martha Stout of Harvard medical school tries to convey what goes on in the mind of such an individual. "Imagine," she writes, "not having a conscience, none at all, no feelings of guilt or remorse no matter what you do, no limiting sense of concern of the wellbeing of strangers, friends, or even family members.

Imagine no struggles with shame, not a single one in your whole life, no matter what kind of selfish, lazy, harmful, or immoral action you had taken. And pretend that the concept of responsibility is unknown to you, except as a burden others seem to accept without question, like gullible fools."

Welcome to the Facebook mindset.

[Jan 30, 2012] Is Facebook run by sociopaths?

A commentator on the Guardian suggests that "companies such as Facebook are the corporate world's equivalent of sociopaths." Might this be true?

While I wouldn't wish to wallow in a definition of sociopathy, I did happen to ask a couple of Facebook's advertising clients how they found dealing with the world's most powerful brain child.

"They breathe their own fumes," one executive told me. And he is someone who gives Facebook rather large sums of money.

It is in this, surely, that Facebook has its power. It tells us all that in tomorrow's world, everything will be social. If you're not riding in the social Ferrari, you will be but a mere cipher in the commerce of life. Worse, you will be a mere individual, someone with absolutely no friends in the playground.

And who would want to be an isolated individual or part of an isolated company? It's tempting, then to view Facebook's world picture as expressing the mindset of a sociopath--or even a con man.

The driving force of both is that their world is the only one that matters. Their own personal joy lies in dragging everyone else into their vortex and watching as everyone stares rapt in an excitement they can't quite define. There's a lot of fun in that.

Is there some ultimate meaning and spiritual uplift in the proceedings? Not so much. Rather, it's the power of the game and the protagonist's power in the game that matter.

The gullible--that would be us--play along because the game seems to offer something that we will enjoy: success or approbation, perhaps.

But, in the end, it's rather hard to believe that every move Facebook makes is the move of a benevolent association or a social revolutionary, instead of a move by an advertising company.

Who might suspect, in their private hearts, that privacy is not something that enjoys too much philosophical debate at Facebook HQ? Rather, it's simply something that stands in the way of selling more adverts. It's an inconvenience that gets in the way of economic progress.

Because economic progress is far more important than any individual's right to keep herself to herself. That's not Facebook's fault, some might say. That's just the world we live in. We've all come to believe that economic progress matters more than anything.

Naturally, this might all change a little should one of the Facebook management run into some sort of personal bother that becomes public. But, until then, let's knock down those privacy walls and make some money.

It is wrong, of course, to suggest that Facebook's management might be isolated in their apparent views. Google, too, would surely prefer it if you gave it more and more information so that it can sell more and more--and, cute phrase this, "better"--adverts.

For Naughton, sociopaths are "individuals who are completely lacking in conscience and respect for others."

I have a feeling that the people who run Facebook and Google aren't sociopaths in their private lives -- should they have them. It's just that when they create one of those social networks we call companies, a strange group-think takes over.

That strange group-think doesn't so much distort reality as try to create a new one.

We are now living in the new reality. It's one in which it all has to start with people. People are products, products are money, and money is power.

Once you have the power, you can even try to tell governments what to do and what to think. And that's so much fun.



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