Financial watchdog the SEC has ruled that listed companies can make key announcements and publish financial info on Facebook and Twitter. The decision follows an investigation sparked by Netflix CEO Reed Hastings. Hastings posted on Facebook in June that subscribers to video-on-demand biz Netflix had watched more than a billion …
It's kind of a public service
Company posts critical shareholder info via Facebook? Company might not be a great investment; not a buy.
What about not having an account on FB?
So I don't have an account on FaecesBook and thus I miss the info because I got the "you must log in to view this" page. Does this mean I win the lottery and can sue the hell out of them? I hope so...
Re: What about not having an account on FB?
I can see plenty of stuff on https://www.facebook.com/netflix without logging in.
Even if you did have to log in, would that really be any more restrictive than needing a subscription to some monitoring service? I mean, not so very long ago, company filings and press releases wouldn't be available to the average investor other than through some third party service monitoring such things or by reading about it the next day in the WSJ or FT.
Great, more volatility
R11's comment about people not being able to see information until the WSJ publishes it kind of highlights a problem we have today -- extreme market volatility that gets worse every year.
HFT has a lot to do with this, but another factor is just the fact that it's so easy for Joe Investor to see something on CNBC (or Facebook/Twitter now) and instantly log in to their brokerage account and trade. I don't want to go back to a world without the Internet, but it sure was a much more predictable stock market back then. Even very wealthy people had to get their information from old-fashioned sources, and in most cases only had a few hours' jump on everyone else. Think about it -- Sir Thurston Picketts III picks up the WSJ, sees an article predicting the imminent collapse of Company X. He has to call his broker, put in a sell order, and hope he can get out before the world burns. So does *everyone* else. Now, that same story pops up on Facebook, and 25 million investors immediately put in the same sell order, all at once, with zero delay, dragging down the price, causing more people to sell, and creating a negative feedback loop.
This is just going to contribute to the ongoing casino-ization of the markets. Too bad everyone's retirement savings is in there (in the US at least...)
Only a matter of time until a company's twitter account is hacked then, tweeting misleading information that leads to sell orders...
When you get down to technicalities, no method works.
"“One set of shareholders should not be able to get a jump on other shareholders just because the company is selectively disclosing important information,” said George Canellos, acting director of the SEC’s enforcement division."
So, even sending out notices in the post won't meet this criteria, as there's no way to ensure delivery to all shareholders on the same day.
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