In the 1980s, there was a famous rap music anthem titled, “Don’t Believe the Hype.” Well, I borrowed that admonition frequently last year when the overblown hype over the Facebook (Nasdaq: FB) IPO reached a fever pitch. Nearly every retail investor I knew wanted to own Facebook stock, and it became a symbol of the groupthink mentality that’s so often infects Wall Street and… Read More
In the 1980s, there was a famous rap music anthem titled, “Don’t Believe the Hype.” Well, I borrowed that admonition frequently last year when the overblown hype over the Facebook (Nasdaq: FB) IPO reached a fever pitch. Nearly every retail investor I knew wanted to own Facebook stock, and it became a symbol of the groupthink mentality that’s so often infects Wall Street and Main Street.#-ad_banner-# The hype got so bad, that in May 2012, I actually had a friend ask me if they should borrow money on his home so that he could buy Facebook shares. Sadly, many people (thankfully not my friend) recklessly scrambled to buy Facebook shares immediately following the stock’s public debut, and many of those investors are still sitting on a losing position. I won’t go into the epic fails on the part of… Read More