Explaining Southern California's economy

Why Google has stopped trading on the Nasdaq stock exchange

KIMIHIRO HOSHINO/AFP/GettyImages

A Google+ logo is seen at Google's annual developer conference, Google I/O, at Moscone Center in San Francisco. The search giant ran into some trouble today on Wall Street.

Two bad things happened to Internet search giant Google Thursday: the company missed Wall Street earnings expectations for the third quarter by a country mile; and its earnings release hit the wires in the middle of the trading day, rather than after hours.

The stock has stopped trading on the Nasdqaq exchange while everybody gets this all sorted out. In an amusing turn, a Twitter account has already been created for @PendingLarry, a reference to a line from Google's premature release to the SEC, "PENDING LARRY QUOTE," with the "Larry" being Google CEO Larry Page.

Former Securities and Exchange Commission Chairman Harvey Pitt was on CNBC Thursday saying that the screwup with Google's release — which could equally be blamed on R.R. Donnelly, who handles the technical aspects of Google's SEC reporting — means that folks who just lost a ton of money ($19 billion market capitalization basically vanished in a matter of minutes) will lawyer up and sue everybody in sight.

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Happy Facebook Day!

Facebook-Stock

Facebook

A good old-fashioned stock certificate, for a company that's anything but.

Facebook finally began trading this morning on the NASDAQ exchange, after some technical glitches prevented the social network from testing its $104-billion market cap and $38 IPO price at 11 a.m. Wall Street Time, as anticipated. The party had to wait until 11:30.

The basic story has two parts. First, there was no big first-day pop — at least not yet, and with just a few hours of trading left on the East Coast, there's every chance that sell orders will be executed late in the day that will push Facebook down to near its IPO price. It won't fall below $38 because Morgan Stanley and the syndicate of investment banks that ran the IPO will provide support at that level.

The stock opened at $42.50, for a reasonable if unspectacular pop, around 13 percent. By contrast, LinkedIn popped 109 percent when it began trading in May of 2011. That performance prompted some market observers to get very, very angry.

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Facebook goes public at $38 per share and raises $16 billion

At last. At last.

It's official. Facebook is now FB on the NASDAQ. The great, heaving social network, started by Mark Zuckerberg (and a few others) in a Harvard dorm room less than a decade ago, will float 422 million shares and begin trading tomorrow.

Humanity rejoices! But life just got much tougher for Zuck & Co., who will now be reporting to Wall Street every three months. 

So...will you be buying? 

Follow Matthew DeBord and the DeBord Report on Twitter.

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