"wanna loose some money???"

"Wanna lose some money?"

Easy. Buy Facebook. It's said to be going public at 150 times earnings.

In order to justify the price, says our colleague, Chris Mayer, Facebook would have to sign up every human being on the planet...and a few extraterrestrials too.

The whole Internet complex is a "bubble that's about to pop," he says.

"It's rumoured that Facebook's IPO will value the company somewhere between $75 and $100 billion - about 150 times 2011 net income, 212 times free cash flow, and just shy of 27 times last year's sales. Facebook's sales have grown 77-fold since 2006, and its valuation based on private secondary markets has soared 92-fold during the same time."

Wow! How do you beat that?

We tried to use Facebook. It just seemed like too much trouble. And what do you get out of it? Another way to keep up with your friends? That is, another way, in addition to phone, mail, SMS, email...and carrier pigeon. Seems like more than enough ways already.

We also tried LinkedIn. We signed up. But we could never figure out what the point is.

So...we apologise to all the many people who offered to make us a 'friend' or a 'contact.' I'm afraid we had to ignore them all. Not because we don't want them as friends and contacts. But simply because we can't keep up with the volume of contacts we have already.

Our advice to Dear Readers: Sell Facebook and LinkedIn...as soon as you get a chance. Turn off Facebook. Unplug yourself from LinkedIn.

Tune out. Turn off. Buy gold. Be happy.

Regards,

Bill Bonner
for The Daily Reckoning Australia

I don't use Facebook, and agree that is is probably over valued, but what you are missing is the revenue model is very different for Facebook. It's users are not the customer, the advertisers are. The potential convergence and aggregation of the information is where the potential long term value is.

Icarus

Easy way to make 30-100% on your investment, IF you buy early in the day and sell before the end of the day. Don't wait, it will tank the second day with all the late acting profit takers.

I wouldn't hold ANY dotcom stock for an extended time. That's what stock in companies that actually produce tangible goods are for.
Here's a tip: there's just one company in the USA that makes and sells most of the safes. Their business has been climbing steadily. Once FDR...I mean BHO...outlaws the private ownership of gold, every other house will be buying a safe, because it won't be safe to keep gold in your safety deposit box anymore; the government can ransack it, and will.

Completely hypothetical, of course

Glad to read I'm not the only one to find Facebook awkward and nauseating! We're all Facebook free around here, can't see the point of it when there are enough other ways to communicate.

I don't use FB and it drives me crazy to see companies that you cannot contact unless you have a FB account! If I'm hiring a web designer, she better be able to build a simple "contact us" page.