Matrix Posted July 14, 2019 Share Posted July 14, 2019 What just happened? The big story yesterday was the FTC hitting Facebook with a record fine of $5 billion, following numerous scandals around the handling of personal data. But markets appeared happy with the fine, and sent Facebook’s market-cap up by over $10 billion, entirely negating the punitive action. Yesterday, we reported that the Federal Trade Commission (FTC) had levied a $5 billion fine against Facebook as punishment for a string of breaches, scandals and controversies. In almost any other context a $5 billion fine would be huge – not only as a punitive measure, but also in signalling just how poorly the business in question had behaved. But in the context of Facebook, given its size, reach and worth, $5 billion is little more than a slap on the wrist. So much so, that following news of the FTC’s decision, the social media giant’s stock price rose by 1.81%, adding $10.4 billion to their market valuation. Markets have rewarded Facebook for getting off so lightly, covering the cost of the fine and adding another $5 billion to the company’s coffers. Many have been quick to point out the flaw in this effort to hold such a mammoth company to account. Senator and Democratic Presidential candidate, Elizabeth Warren, called it a “drop in the bucket penalty,” tweeting our renewed calls for Facebook to be broken up. There’s no question that $5 billion is a lot of money, but given that Facebook made $22 billion in profit last year, and another $15 billion in revenues last quarter, many people think that the punishment doesn’t fit the crime. It should be said that the FTC’s decision wasn’t only monetary. The Washington Post reports that Facebook “may have to document every decision it makes about data before offering new products, keep closer watch over third-party apps that tap users’ information, and require its top executives, including CEO Mark Zuckerberg, to attest that the company adequately has protected privacy.” Though it seems reasonable to wonder why none of those things were mandatory to begin with. VIEW: Original Article. Link to comment Share on other sites More sharing options...
Disco Bob Posted July 14, 2019 Share Posted July 14, 2019 The rich get richer as always no matter the crime / criminal Link to comment Share on other sites More sharing options...
xpkRAKE Posted July 14, 2019 Share Posted July 14, 2019 Hitting them in the pocket is obviously a useless tactic - zuckerberg should be in prison. Link to comment Share on other sites More sharing options...
luisam Posted July 14, 2019 Share Posted July 14, 2019 19 hours ago, Mach1 said: So much so, that following news of the FTC’s decision, the social media giant’s stock price rose by 1.81%, adding $10.4 billion to their market valuation. Markets have rewarded Facebook for getting off so lightly, covering the cost of the fine and adding another $5 billion to the company’s coffers. Now wait a minute, maybe I don't uderstand clearly financial concepts but a company will not have more cash on its account with a rise of its stock price. Presume that to have access to that value, they might need to sell stocks, to have cash, and so stock value might go down. Link to comment Share on other sites More sharing options...
steven36 Posted July 14, 2019 Share Posted July 14, 2019 9 hours ago, xpkRAKE said: Hitting them in the pocket is obviously a useless tactic - zuckerberg should be in prison. Your talking about Facebook we already knew fining them would do no good it just conman sense ,the only thing would do any good is the Government breaking it up . Losing 5 billion or gaining 10 billion is nothing to them there a IPO company they play Russian Roulette on the stock market everyday . Jul 26, 2018 they lost a $123.4 billion in one day and didn't even really effect them in the long term . They can always make that money back after so long. People seem to forget how much money they lost because of scandals already 5 or 10 billion is nothing to them. They still not worth what they was last year, now they at $584.799B they peaked at $611.5B last year so they still never got all the money they lost back, they still in the negative from last year they spent most of 2019 gaining back what they lost in 2018. They up and down now every since the scandals. Only reason the stock market is doing good right now for them is the fed is going to cut interest rates it will be short lived . https://www.macrotrends.net/stocks/charts/FB/facebook/market-cap Link to comment Share on other sites More sharing options...
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