Google's Dutch Auction
<div class="IPBDescription">How much would you bid?</div> Well, Google is going public! But they aren't doing it in the regular style on Wall St. No way! To sell their shares they are holding a Dutch Auction to give smaller investors a chance! What is a Dutch Auction exactly?
Here's a little snippet I found:
<i>"Imagine the Dutch auction of a 100 share offering. The auctioneer begins by calling out a prohibitively high price per share that he knows will attract no bids. He then calls out lower and lower prices until someone decides to buy a few shares (eight, for example). The auctioneer continues to lower the price until someone agrees to buy more shares (12, for example). So far, bidders have bought 20 shares, one-fifth of the total IPO, and they've bid different prices.
The auctioneer continues to lower the price until all 100 shares are spoken for. At auction's end, bidders get the number of shares they agreed to buy, but at the price bid by the last bidder. If the first guy bid $100 per share for the eight shares, and the second guy bid $75 per share for the 12 shares, they only pay what the last guy bid--say, $50 per share."</i>
<a href='http://slate.msn.com/id/1002736/' target='_blank'>Read full article here about Dutch Auctions</a>
So with that said, how much would you bid?
Now I know what a bunch of you are thinking, "Um I don't have any money..." Well let's just say theoretically for discussions sake.
The facts are that right now you could open up an online stock trading account for as little as $1000; the price of a moderate computer upgrade. $2000 with no quarterly fee (typically on ETrade, Ameritrade) Say you have more than that? $3000? $5000? $10,000? What would you bid and for how many shares?
Ebay has Dutch Auctions all the time. Anybody have experience with those? I think the rules might be a little different.
This discussion is of course assuming that you at least somewhat feel that Google is a worthwhile investment. If you do not, I beg you not to taint the discussion. Thanks.
Here's a little snippet I found:
<i>"Imagine the Dutch auction of a 100 share offering. The auctioneer begins by calling out a prohibitively high price per share that he knows will attract no bids. He then calls out lower and lower prices until someone decides to buy a few shares (eight, for example). The auctioneer continues to lower the price until someone agrees to buy more shares (12, for example). So far, bidders have bought 20 shares, one-fifth of the total IPO, and they've bid different prices.
The auctioneer continues to lower the price until all 100 shares are spoken for. At auction's end, bidders get the number of shares they agreed to buy, but at the price bid by the last bidder. If the first guy bid $100 per share for the eight shares, and the second guy bid $75 per share for the 12 shares, they only pay what the last guy bid--say, $50 per share."</i>
<a href='http://slate.msn.com/id/1002736/' target='_blank'>Read full article here about Dutch Auctions</a>
So with that said, how much would you bid?
Now I know what a bunch of you are thinking, "Um I don't have any money..." Well let's just say theoretically for discussions sake.
The facts are that right now you could open up an online stock trading account for as little as $1000; the price of a moderate computer upgrade. $2000 with no quarterly fee (typically on ETrade, Ameritrade) Say you have more than that? $3000? $5000? $10,000? What would you bid and for how many shares?
Ebay has Dutch Auctions all the time. Anybody have experience with those? I think the rules might be a little different.
This discussion is of course assuming that you at least somewhat feel that Google is a worthwhile investment. If you do not, I beg you not to taint the discussion. Thanks.
Comments
.. maybe $1000, just for the hell of it =D
btw, "dutch" auction? .. must be a British thing <!--emo&;)--><img src='http://www.unknownworlds.com/forums/html//emoticons/wink.gif' border='0' style='vertical-align:middle' alt='wink.gif' /><!--endemo-->
.. maybe $1000, just for the hell of it =D
btw, "dutch" auction? .. must be a British thing <!--emo&;)--><img src='http://www.unknownworlds.com/forums/html//emoticons/wink.gif' border='0' style='vertical-align:middle' alt='wink.gif' /><!--endemo--> <!--QuoteEnd--> </td></tr></table><div class='postcolor'> <!--QuoteEEnd-->
Maybe its a Dutch thing.
Most phrases in the English language with 'dutch' in them are British inventions.
Has something to do with them not liking us in the 17th century <!--emo&:p--><img src='http://www.unknownworlds.com/forums/html//emoticons/tounge.gif' border='0' style='vertical-align:middle' alt='tounge.gif' /><!--endemo--> (it's like that whole 'freedom' / french fries thing)
now, going ontopic for a bit: how will this way of auctioning give a chance to the 'little' guy?
The first ones to buy all of the shares will be large entities with large cash reserves (because of the high prices (or maybe I'm just missing the point, please correct me if I'm wrong))
Here's some more good news. Sounds like they aren't offering shares till late summer or autumn so that means if you don't have $1000, you got the whole summer to get it! Do some time at McDonalds or Subway. Imagine one summer of work paying for a college education! Don't want to get all the college students hopes up but I think the odds are much better than the lottery! Google is a strong company.
I remember when Amazon first came out and its stock was tanking, the business was leaking money everywhere, but then the CEO got his *stuff* together and now they are one of the top tech companies. Truth be told I didn't care what the business analysts said because I was buying books and CDs from Amazon even when the company was failing because I simply loved their product; sadly I didn't have money to buy the stock. The truth finally came out however that it really was a great product.
I think Google is a winner too.
Most names of .com companies didn't become verbs.
I myself would bid in the upper 5k, maybe 10k. Google isn't just a search engine. Its a way of life for most people(seriously).
But all the Joe Sixpacks are still using Windows and if MS is serious about entering the search engine market they'll make damn sure everybody's going to use -their- search engine.. whatever way they can.
I really hope people will keep on using Google though, I really do. <!--emo&???--><img src='http://www.unknownworlds.com/forums/html//emoticons/confused.gif' border='0' style='vertical-align:middle' alt='confused.gif' /><!--endemo-->
but I'll stop argumenting about this, because this is kind of what the last sentence of the original post is about <!--emo&;)--><img src='http://www.unknownworlds.com/forums/html//emoticons/wink.gif' border='0' style='vertical-align:middle' alt='wink.gif' /><!--endemo-->
I raise my original $1000 to $2000 btw <!--emo&:)--><img src='http://www.unknownworlds.com/forums/html//emoticons/smile.gif' border='0' style='vertical-align:middle' alt='smile.gif' /><!--endemo-->
It's not as if Linux is easily accessible, or supported in the same way. The Mac isn't really a competitor. What's the best option apart from Windows, that people are "still" using?
As for Google, I'm too cautious to put money in the market, but it'll be neat to watch how it goes.