Nasdaq FB: Is this the cause of Facebook’s Economic Decline?

Sep 16, 2012 -- Posted by : admin

On a recent report from Money Morning, Facebook’s meek performance on Wall Street is relatable to common phenomena regarding unpronounceable ticker abbreviations. Companies that have a ticker name that does not form a legible word will most likely fail - For real?!

"[Our] research shows that people take mental shortcuts, even when it comes to their investments, when it would seem they would want to be most rational," Professor Daniel Oppenheimer, who co-authored a 2006 Princeton University study of the subject, told Psych Central.

While the academics who have studied this have not conclusively nailed down the cause, most suspect it has to do with something called "fluency," or how easily a person can process information.

People are simply drawn more to a catchy ticker symbol like YUM than a drab one like FB.” [Source]

While most think that Zuckerberg is the cause for the company’s poor performance these last few months, this phenomena could truly explain why Facebook is at an all-time low. While I still support the future success of Facebook and the Zuckerberg regime, I don’t know if this occurrence is anything more than a lochness monster sighting.

Stocks perform based on the behavior of the market which is in turn adversely affected by the behavior of buyers in the market so I guess this could hold true. Could this mean that social media marketing has nothing to do with Facebook’s success or failure? How will this information impact the online marketing firm of tomorrow? Your thoughts?


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