Monday, May 21, 2012

More on Facebook...

Felix Salmon talks about the Greenshoe, although he gets it slightly wrong (a rarity for Mr Salmon).  The Greenshoe is the option to sell an extra 15% of the issue, it isn't about shorting the issue.   The SEC allows the underwriters to take a naked short as they are making a market in the new IPO stock.  It is the combination of these two things where the financial magic happens (see my Friday post).

From Twitter:


From Business Insider: