With Nasdaq now coming up with the real story on the 'Facebook fiasco' we can now blame it all on the delay in Nasdaq's systems (and insider trading). According to the reports the basic problem started with the late launching. Initially the shares were supposed to be launched as soon as the market opened up but then it opened up a little later around 11:30. The real problem was that at that time the pre-orders still existed along with the orders incoming and Nasdaq's system couldn't take this. Nasdaq's system showed lags as the pre-orders didn't process almost till 1:50. By that time the stock had reached a new price. around $42. So what happened was that the people who ordered the shares at the offering price were getting their deals coming through hours late and at prices they didn't order the shares for.
Due to this major banks and other institutes saw major losses. Facebook's stock fell from a peak of $42 to $31.91. This was a big fall for one of the 'most awaited IPO's'. The other problem which is escalating is the volatility of the shares. If we look back at LinkedIn the same problem was seen. Social Media is one field whose true potential is still unknown. We still don't know where this road shall lead us. The uncertainty comes from everywhere because from a personal point of view Facebook's IPO was over hyped and over valued. This came out as a big problem and that is why the extremely volatile situation of Facebook might worsen.
Although it rose to $32 after Thursday's trading session it is still unpredictable how it might turn out now. Nasdaq also faced a loss of one percent in it's share price due to inconsistencies and questions on credibility.
Nasdaq which needs to sort its ways with so many new allegations popping up is facing a big problem. Facebook on the other hand is losing out on credibility if something like this happens again. Some questions still remain though. Like 'Is Nasdaq not compatible for something as big and volatile as Facebook? and 'Insider trading - Who made the killing out of the fiasco?'