A quick line on Facebook shares

Facebook lost around 11% of its value on a single day after it went public. This is probably reflecting concerns on monetization of its consumer base - a long anticipated problem (that actually should only raise eyebrows on why to additional shares at the high-end of the price range). And a problem that is still not exclusive of Facebook - most of the big digital and social companies are still struggling to ensure revenues that match its consumer base (we are talking about names as Twitter, Pinterest,...). That is why I always talked about a possible bubble looming in these area of trade. Warren Buffett once said that you shouldn't invest in a company with a business model that you don't understand how to it is making money - a very good warning that if nobody knows how the company is making money, then, probably, share price gains are being made through speculation. Which is not good...

It will be interesting to follow Facebook over the next few months and understand market trust on the company. But let me disclose it to you - yes, there is a share price that will make me buy Facebook shares... (I will just not tell you which).

http://www.publico.pt/Tecnologia/facebook-caiu-11-e-fecha-ensombrado-por-duvidas-dos-investidores-1547060 

http://money.cnn.com/2012/05/21/markets/facebook-stock/index.htm?cnn=yes&hpt=hp_bn1

8th

Portugal is the 8th European country in terms of tax burden - and that is having dire consequences in terms of choking economic growth. The solution can only be one - decrease the size of the State and its weight in the economy. We need that to ensure future growth - but it is a painful and long process...

http://economia.publico.pt/Noticia/peso-medio-dos-impostos-cobrados-em-portugal-abaixo-da-media-europeia-1547009

You know I agree with him

Europe needs a growth strategy, as Hollande and Moscovici are saying. And I agree with that. But that shouldn't be understood as a way to invest in lax ROI projects. Budget rationality should still be at the core of investment.

http://economia.publico.pt/Noticia/franca-nao-ratifica-o-tratado-orcamental-sem-medidas-de-crescimento-1546464

White Elephants in Spain - a reminder

This week's Time is highlighting Spain's white elephants - the cheer number of expensive cultural centers, airports, high-speed rail connections... I have already talked about them here  http://my2centsontheworld.blogspot.co.uk/2011/06/spanish-elephants.html . But I think it is useful to remind them, as symbols of what happens when there isn't a strong Governance spending process - most of them were actually built and promoted by autonomic regions budgets, based on lose assumptions and with regional pride and voters as their main aim. And what happens when projects don't have a Return On Investments menthality at their core, supported by sound calculations and educated assumptions. It is a common mistake - but with dire consequences. And in 5 years time, we should still remember this lesson.

http://www.time.com/time/world/article/0,8599,2114888,00.html

A benefit of global teams

Working with people from all over the world, all seated at the the same table, holds an amazing benefit - we can understand how different countries, cultures, people feel and live the same situations. Listening a Greek and a German talking about the euro crisis, understand the Indian - Pakistani riff is not that important for the people, share the hardships of non-European nationals to travel to so many countries. It is an amazing and eye-opening experience!

Henrique de Castro's interview

It seems I am in a positive mood. Again, I identify with many of the points Henrique de Castro (one of Google's Presidents) highlighted. Namely the need to rethink the return Portugal offers investitors, the need to refocus university work towards output and importance of private investment and initiative and of free-will. It is a good interview - very pragmatic.

http://economia.publico.pt/Noticia/a-emigracao-portuguesa-e-uma-optima-oportunidade-para-ter-acesso-a-mercados--1544700

Yes, I agree with Mario Draghi

As you know, I believe Europe needs to reduce non-productive expenses, while supporting higher competition and consumer power and defining new productivity and growth strategies. Let's do it?

http://economia.publico.pt/Noticia/draghi-pede-a-europa-para-por-o-crescimento-no-centro-da-agenda-1544542