So UBS has lost $350M after Facebook’s botched launch, and the only people to be surprised are those who were stupid enough to try and buy the shares instead of buying puts (which would have made them significantly richer).
UBS is supposed to be one of the world’s leading banks, and yet time and again they squander money in a manner which beggars belief. I’d find it laughable if I hadn’t been forced to pay my taxes to provide UBS with a 65billion$ bailout a couple of years back; the way things are going it seems more than likely that they’ll be back, cap-in-hand, in the not-so-distant future.
What does surprise me is the naivety of all concerned. It appears that many well-paid employees at UBS subscribed to the idea of buying shares in a company whose business model is based solely on displaying advertisements which are completely ignored by a barely-literate proletariat bent on exchanging mindless drivel.
In a few years, Facebook will be remembered as an ugly skid-mark on the digital toilet.
Hopefully sooner, UBS will nominate a CEO who can learn from his predecessors’ mistakes: sell off the investment banking division, close all operations in the USA and focus on what the bank does well: private banking. The Swiss will once again be proud of their successful bank and grateful both for the reduction in taxes and hassles from the Americans.