The bias of stock market movements and the psychological phenomenae that affect it have been pretty well documented. The purposeful ways of manipulating it less so, though with every new scandal we learn – usually retrospectively – something new. As a person with some history in technology, what never fails to impress me is how tech journalists get carried away. A recent example is Facebook. Glowing reports and hyperbole, dotted with a few lifestyle titbits and dashed with vague futurological questions was all we got for years.
And then came the IPO.
Suddenly we learnt all about its internal management issues. Guess what? A major percentage of Facebook’s users (that enormous number journalists flouted about in the titles) is fake accounts. Oh my, what a surprise! We learnt about Zuckerberg’s lack of skills for the job. The huge problems in the business model, the enormous questions about the kind of advertising it sells. The possible impact from legal action in relation to privacy concerns.
All this was either non existent in the press before, or glossed over. But when it comes to paying good money to buy a stock, we are obviously more careful than we are when choosing what to read.
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