Follow-Up on FXCM, Forex, and Japan Stimulus

Modesty is a nice quality but it's not generally rewarded in the financial world.  So, I'll give myself a short, gentle tap on the back for my prediction that the the forex broker FXCM would rise in the wake of the Japan stimulus announcement.  I made that call on April 4 and FXCM has risen 6% since then (the stock was trading at $13.10 when I posted but ended the day at $13.44).   

Forex Trading in Wake of Japan Stimulus: FXCM

I've been thinking about a position in FXCM, a retail foreign exchange trading retail broker.  Now, I've jumped in after a recent pull back in the stock and today's announcement of a massive stimulus by the Bank of Japan, partly aimed at devaluing the Yen.  It would seem that this move could spur a wave of forex trading, as traders assess the effect of the Japan stimulus on currency markets.  We'll see.

Follow Up on My Post on Japanese Elections

In December 2012, I suggested you might want to think about some investments in Japan if Shinzo Abe was elected PM of Japan, because he could well push the country into a US-like central bank stimulus, in an effort to reduce the value of the Yen and boost Japanese exports.  This has now happened, as the Bank of Japan today announced a massive stimulus campaign:

http://money.msn.com/top-stocks/post.aspx?post=452506bc-5f54-43a3-b415-ab99a8de70b2

EWJ, an ETF I recommended at the time of my last post in December 2012, is up more than 10% since then and may now climb higher.

Can You Afford to Be on Facebook? Part II

Jon Evans at TechCrunch agrees with me on the possible dangers of being deeply involved in social media sites like Facebook.  Since he's a novelist, he paints an even scarier picture of your possible future than I did.  Here's a link to his article:


http://techcrunch.com/2013/03/30/big-data-could-cripple-facebook/

Can You Afford to Be on Facebook?

How would you like a potential employer to look at your Facebook "Likes" and conclude that you are not smart enough for the job?  Or, equally bad, that your sexuality is incompatible with the employer's views?  But, you say, nothing in your Likes speaks to these issues.  So you might think, but a joint study between Cambridge University and Microsoft Research predicted a large group of Facebook users' IQ's, sexual orientation, and other traits to a high degree of accuracy using their Facebook Likes.  Here is a link to an article on the study:

http://www.wired.com/gadgetlab/2013/03/facebook-like-research/

Not convinced of the method?  It really doesn't matter.  These studies are being done, they will be found on the internet (or otherwise) by employers, and quite probably incorporated into hiring decisions whether they are accurate or not. 

As this type of use is made of Facebook data, more people will have to ask themselves whether they can afford to be on Facebook.  And that is not a question that will be good for Facebook's business. 

Google's Other Search Engine

I like to try out the following statement on people to gauge their reaction:  "Youtube is the most valuable media property ever created."  Some people laugh, others pause for a moment before starting to argue with me.  I do not think the statement is far wrong.  According to some measures, Youtube captures 20% of all web traffic daily.  And all of those eyeballs get served with a large helping of ads.  What do you think most young people find more exciting, Youtube or network television?

To my point, NPR ran a story today in which a teenage girl was interviewed.  Youtube is her main source for discovering new music.  She did not refer to Youtube as a "video website" but rather as a "search engine" for finding music.  Oh, and she never, ever pays for music.  Youtube is probably more valuable than the entire music industry right now for this reason, among others.  Anecdotal evidence, to be sure, but this isn't the first time I thought this about Youtube.  Why?  Because it is also my number one source for discovering and listening to music.

Compare this with Pandora and Spotify, darlings of internet radio, both of whom are struggling to make a profit because no one wants to pay for their services. 

And Youtube is not just music, of course.  Want to see an interview with Dean Martin from 1969?  A clip from the 1975 World Series?  Footage of an A-10 in combat over Afghanistan?  Where are you going to go?  And each day, the density of videos on Youtube increases.  Microsoft and other companies are trying to nibble into Google's main search product.  But is there any competitor for Youtube?  No, because the barrier to entry is growing with each video posted.  And it will keep growing...

The Other Social Network: Google+

I've made no secret about my like of Google as a company on this site.  Who else is at the cutting edge of search, driverless cars, and server technology?  And Youtube is a rather valuable property, given that 15-20% of daily internet traffic resides there.  And this isn't all the company is doing -- not by a long shot.  As an example, Google+, the company's relatively young effort to get back into social networking is gaining traction rapidly.  An article this morning in Wired notes that Google+'s growth rate mirrors that of Facebook in its early days. 

http://www.wired.com/business/2012/12/google-grows-like-facebook/

Yes, Google has had some missteps and may not have the respect for privacy that we would like (although, they are not alone among internet companies in this).  When all is said and done, a long-term investment in Google seems like a really good idea to me.  I've already put my money where my mouth is on this one.