What a wild ride for Google today!
Didn’t quite hit my low prediction of $329 but I was fairly positive it was going there when news came out that they were compromising with the DOJ. The spike up at 12:40 surprised me as well as the guys who had been propping it up all morning but they quickly recovered and started selling into the rally.
http://finance.yahoo.com/q/bc?s=GOOG&t=1d
How do I know this? Thomson Financial (the “First Call” people) has a very useful chart that tracks institutional buying and selling. The presentation is terrible and I wish I could get the data and make better charts but here it is:
http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?ticker=goog
Now it doesn’t take a genius to see what’s going on here. “THEY” kept the price from falling below the $329 break point, from which it would be hard to recover but immediately sold anywhere above $335 – it is interesting what you can do with a stock when you are allowed to buy and sell the same security all day long with no margin requirements or account restrictions!
Notice heavy buying to save it from going to $330 at 10:45 and another big goose right at 12 – before the hearing started! So the idea was to create the impression that things were going well no matter what actually happened… Getting good news so quickly caused a huge run up and the institutional buying quickly ground to a halt.
After letting all the retail suckers buy it up to the psychological level of $345 it was SELL SELL SELL SELL SELL while the retail investors did a BUY BUY BUY. This is how the transfer of wealth is affected in this country!
At this point, just 3 days from expiration, I am just looking to get out of my remaining calls at it is possible the stock will flatline into expiration. Last month the stock gained 40 points on expiration day but counting on something like that is a good way to go broke.
Mike sent an interesting note in regarding Accoona, an upstart search engine (which I bet he doesn’t know is in large part owned by China Daily Information) that he says is “catching on” in colleges. Now what is really interesting is when you Google Acoona vs. wheh you Acoona (too soon to be a verb?) Acoona you get very different results.
Here’s an even better one: Type in “Chinese human rights violations” in Acoona and Google and compare them. The Google results on the first page are far less critical than Acoona’s! In fact, hit #5 on Google is a Chinese paper’s critique of the US’s human rights violations – out of 21,000,000 hits that one was the 5th most relevant?!?
This is not the first time Google has appeared to edit more than just Chinese search results, we had a similar problem finding information on “Google click fraud” when we tried to Google it a couple of months ago!
What was most interesting is that I got motivated to throw up Acoona, Ask, Google and Yahoo (which I never use for search even though I’m on the site all day) and put in “Iran Oil Bourse” in all four engines. I don’t know why I was surprised at the results as I understand all the underlying technical issues with various search algorithms but I was surprised at how different the first page of each was.
I was also surprised that Yahoo has a very nice search engine and I may start using it rather than popping over to Google all the time.
So my conclusion is: Barry Diller has a search engine, China has a search engine, Yahoo has a search engine, Bill Gates has a search engine and Google has a search engine… Why would I pay triple (p/e) for just a search engine when I can get one thrown in with MSFT? Hell, IACI’s current p/e is 12.6! YHOO’s p/e is 24. MSFT’s is 22.5. They, along with 20 other Acoona style upstarts all say they will grow over the next few years yet the only one that investors seem to believe in is Google (p/e 70 – and that’s assuming a lot of things)?
Yet they don’t really believe it do they? Otherwise why all the selling at $345? That’s like leaping out of Yahoo because it goes up from $33.30 to $34.50 in one day – 4%, OMG no, no more profits, I can’t stand it, must sell… Doesn’t ring true for a stock you believe will go to $500 (or even $400) does it?
Google’s growth assumptions include wiping out the competition by 2010, being able to wallpaper their search screen with ads without losing any eyeballs and, ultimately, displacing windows as your operating system.
Microsoft has a simpler plan: By 2010 have a 25% market share in search. That would ruin Google’s plan entirely! The only thing worse than that would be if some upstart like Acoona actually catches on…
Speaking of Microsoft, they have been busy locking up the big advertisers. Here’s a shocking announcement that is probably going to make me wish I’d held my puts yesterday:
http://biz.yahoo.com/prnews/060315/sfw034.html?.v=51
Oh yeah, and don’t forget about these guys… Seems AOL is making good use of the Billion dollars Google gave them (and Google is going to expense that when?):
http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060315:MTFH87091_2006-03-15_05-01-37_N14382801&symbol=INTC.O&rpc=44
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Speaking of Iran, here’s an interesting article from New Zealand courtesy of Yahoo from when I was doing my comparison. I wonder what else I miss by using Google too often?
