SevenCubed - 4:57 pm on Oct 23, 2012 (gmt 0)
Hurting small businesses is bad but hurting small investors is OK?
If there was an impression from my previous post that I don't care about the small retail investors I want to clear the air.
First of all the largest percentage of the stock markets today are only playgrounds for the institutional investors. I haven't bookmarked any financial articles from any sources that I can post a link to but there many out there that explain how retail investors (moms and pops) have been chased out of the market in the last decade. Moms and pops are probably less than 10% of market participation. Institutional investors are big boys, they know how to play the game and can take care of themselves. In fact they often times manipulate the game for their own benefit, at the peril of retail investors. But, for the retail investors who can afford to buy board lots of goog shares at $500+ I can only assume that they didn't have that much spare money kicking around by being careless in life's events. Therefore, they too no doubt have the intelligence to know when to get in and when to get out of the share. Right now we need to be more concerned about countless businesses that are being adversely affected worldwide. The ratio of affected small investors as compared to affected small businesses is what causes me to lend my support to the small businesses (sorry backdraft7 no offense, I've always respected your posts and still do, and as you pointed out you are a goog shareholder). I have to stand by the majority rather than the minority.
Stock market "investing" has changed dramatically in recent decades from the perspective that their has been a major shift away from the long term strategies of "buy and hold" to the short term "instant gratification" crowd. In fact most of the retail investors that are left are now what we know as day traders. It's purely gambling. With few exceptions individuals no longer buy at age 25 and hold until age 55 to then sell their shares to take their capital gains profits for their retirement years. Also along the way a company typically reaches a stage of financial maturity when they become known as blue chip stocks. In a nutshell they are no longer expected to have significant growth so they then need to begin paying investors dividends. Younger public companies typically don't pay dividends but it is commonly accepted that they are going to reinvest profits back into the company to grow the business. But when you consider the EPS that goog has been making they should have been rewarding the common share holders by now with dividends. Instead they just continue to go on a spending spree buying technology companies. They ARE NOT INNOVATORS, they simply buy up innovative companies.
I want to make one more comment about what I quoted previously:
Destroying business? Really? Those businesses have decided that they want to make money based upon some other company's algorithm. Thats not a business, model that is gambling.
What do you suppose google's business model was? They decided that they could make money based on the intellectual property of other companies and frame it with ads. That type of relationship is healthy as long as it is symbotic as I explained earlier. But goog in all their mighty wisdom (they are after all a "knowledge team" with a "knowledge engine") have decided they can go it alone and just take and take and take with no consequences. It doesn't work that way. There REALLY is a law of karma; I'm not using that term loosely. An entity like goog can only inflict so much damage on others before it snaps back on themselves. The writing is on the wall. They brought people up to the top of the mountain(view) and proclaimed that all the world can be theirs if you only worship them like so many of us webmasters have been doing. It's time to reclaim our dignity. I took mine back with my harsh words in my previous post. If I suffer a -950 karma point penalty because of it, meh, it was points well spent. And it gets goog off the hook for their indebtedness to me so I did them a favour even though they don't deserve it.
Finally, I don't want to see the company itself in ashes, but the share prices, I couldn't care any less if I tried. If they go belly up (extremely unlikely) then we will only have to deal with a new monopoly a decade from now when a new player is unable to control their gluttonous greed. We need them to remain as a search engine company but we also need at least 2 more equally as dominant ones to keep them in check. If SEM was shared equally among at least 3 players the healthy competition would ensure that no single one could run all over us like goog has been doing in recent years.
I really don't feel like wasting any more breath on goog. I could go on for another 1000 words here to reinforce my point but I have more productive interests to devote my time to. But I did just check my karma balance before writing this and I realized I can afford another -950 point penalty if need be so I'm not here to make any apologies this time. Defiant little bugger eh?
Let it ride...