it's the village square, but it was the leadership of it that got me excited going back and but there's other companies out there, yelp, invested in drop box. there's a lot of excitement in america. this is -- in this area. i think facebook is only the beginning. that's my own feeling. >> it is a beautiful day for him. thanks for watching. have a great weekend. hi, everybody. happy friday. we enter the final stretch. i'm maria bartiromo. >> i'm bill griffith. interest is fading in the homestretch. if we close lower, the dow will be down for the 12th time in the last 13 days. that would be the worst such run we have seen in the markets since 1974. that was a major low for the

markets before a great bull run started after that. just pointing that out. financials among the laggers today. jpmorgan chase has been down more than 1%. here's what the markets have done today. lackluster trading in the open this morning, then a move lower around noontime. it was around the time that facebook hit open. the dow saw its biggest declines there. the same thing for the nasdaq, down 27 points right now. 1% decline right now. we're at the lows of the session at 2786 and the s&p is down nine points at 1295. >> one hour to go before the stock everybody is talking about closes in the first day of trading, of course. we have a bet on this. remember that, bill? >> yes, we do. >> we're of course talking about facebook. the stock opened at 11:30 a.m. eastern, got a pop out of the gate. not as strong as some people predicted. it almost slipped to $38 a share, only to bounce back and to hold on the modest gains into the close. it could be the most heavily

traded ipo on record. investors will be monitoring this final volume certainly to see if facebook surpasses the 458 million shares traded during general motors ipo. remember how busy the day was at that point. >> a lot may be decided at this hour. we'll watch very carefully as how the stock trades. there may be insiders who are willing to get rid of the stock before the those today. >> yeah, we're watching that. will facebook save face in the final hour and get the coveted day one stock pop? we have melissa lee over at the nasdaq. and peter soren tino is with us and good to have everybody on the program today. peter, in the past we have talked about financials. i want to kick it off right there. because i know you're an owner of financials. what do you want to do with a company like jpmorgan? are we down 30 billion market value, and now we're talking almost a $5 billion mistake? >> yeah, maria, really it begs

the question of are the financials too big now? and have we gotten too complex? it's certainly killing off the argument that you can't have more regulation on them. you know, this was something that was held out as something they should be permitted to the and managed to shoot themselves in the foot doing it. it's an industry that we have a hard time getting warm and fuzzy over because of the changing regulatory environment, the negative press and their propensity to -- as i said shoot themselves in the foot routinely. >> so what would you say -- i mean, what would you look for for any sign that in fact the stock has, you know, stopped falling? like a falling knife at this point, would you go in today and look for value or no? >> no, not at this juncture. really i want to wait and see because those positions are yet to be unwound. i want to wait until they announce bad news and the stock doesn't react to it that's a good buying place. it's a well-run company other than this event. they have a great franchise, retail and on the money center side. so it's a name worth owning but

again it's at the right price. we need to price in some more cockroaches in this story. >> melissa lee, let's talk about facebook. some anxious moments on the open this morning and we're starting to see the stock fade right now. i guarantee this is not the kind of day most people expected for this high-profile ipo. >> no, not at all and the bottom line here, bill and maria, there's a lot of disappointment out on the street. call it what you will. you can say the thing was price perfection. but there are a lot of others who anticipated a greater pop and especially after the delays we saw. remember, the nasdaq on a conference call said 11:05 is when it would start to trading. 11:30, that's the first trade. it was communications problems and to give you an idea, 82 million shares traded in first 30 seconds. that's the first set of issues that we dealering with. the second set of issues come to play in this final hour of trading, bill and maria. that is we have been hearing on the street a lot of institutions have not been able to get their

orders confirmed. these are orders that were placed early on in the session. as they're filled you have to wonder what the impact is on the stock as it approaches the $38 mark. >> as we're sitting here talking about that, that's what's happening here, bob pisani, and you have to know that some are watching with great interest, aren't they? >> this is not this technological glitch melissa was referring to. it's not an nyc versus nasdaq problem. apparently the technology did not hold up very well under the weight of the message trafficking. this has happened before and there will be an investigation about this. the institutional community is not happening as melissa noted for several hours this morning. i believe these have been filled. orders to buy and sell before the stock opened were not confirmed for several hours. you need to confirm that the know where you stand. whether you can buy or sell more stock. it created a lot of confusion and frustration in the community. i think you're going to find there will be some efforts to

find the solution. maybe the stock should have been halted until they cleared all the message trafficking. i don't know. a lot of second-guessing about this. >> bob, make a good point, it may not be a nyc versus nasdaq problem. the fact of the matter is when the delays started to happen at the nasdaq that's when the stock started to trade lower and ever since we have seen the stock trade lower. >> absolutely, melissa. >> we are seeing that facebook has broken the record for volume at this point, melissa, so we have a new record for first day of trade for a stock. >> john, let me ask you about the impact that facebook is having on other technology names. there's some word earlier that some managers are selling some tech stocks to buy facebook. what are you seeing in terms of the impact on tech overall? >> well, we saw some unloading of apple earlier in the week to make room for the facebook ipo obviously. right now, most of the stocks are just being dragged down

because the market is in a correcting mode. i think that the technology stocks on the break of apple, back below 600 after the last earnings have obviously put pressure on the market, the jpmorgan news, the news of greece, out of china, fears of slowdown. the reserve climate cut last week. the problem in spain, the big g-8 this weekend. i think the market wants to square up before the weekend and see what happens out of the g-8 and get ready to move ahead next week on some of the data points we're going to anticipate. >> how do you think this market closes here? >> right now, we're testing the overnight lows which puts the correction from the highs at about 9%, so right now, if t the -- if the overnight lows break, i think we'll see some stop loss selling into the close. and especially we may see that in facebook as well. >> all right, thank you all.

bob and melissa, we'll be checking back with you guys as news warrants. in the meantime, let's see how facebook's ipo has affected other social media stocks. seema mota has that for us. >> that's right. it's cast a shadow over social media stocks. this week, ahead of the facebook ipo, these are the stocks that enthusiastics were buying into. many traders bought into zynga, groupon, yelp, as well as linked in hoping they'd ride the coattails of facebook. getting off the facebook bandwagon for a second, yes, there were other stocks in focus today. yahoo! trading sharply higher after sources reported that the firm is very close to selling its ali baba stake. another bright spot in trade, the best performing stock on the s&p 500 today was sales force.com. beating street estimates, the software maker raising the full-year outlook as growth

remains strong in all of its reasons. and also in the tech world, hewlett-packard is reportedly cutting 8% of the work forces as it battles falling profits. a formal announcement is expected when they announce earnings next wednesday. some retail movers today. gap reporting a jump in operating expenses and weakness abroad. that's weighing on the stock today. and and one is up better than 5% and last, we take a look at foot locker. higher spend, marketing paid off, driving more foot traffic. the company saw its net profit rise by 36%. maria, back to you. >> seema, thanks so much. in the final stretch here, the market is off of the worst levels for sure, about 50 minutes until the closing bell sounds for the week. the dow is down 44 points right here. >> you will not believe what we have planned for next couple of

hours. we are just getting started here on "the closing bell." is call for a compensation at jpmorgan? now john lew is urging a vote against directors. we'll hear from him next. plus, it's the largest tech ipo ever and the darling of wall street today. but are you better off buying shares of apple? which until recently could do no wrong in the eyes of investors. you're watching cnbc. you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying...

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okay. headed for the last 45 minutes of trade here, let's get a market stat check. at the moment, the major averages coming off the session lows on pace for the second sixth-session losing streak this month. look at the dow, coming off the lows in a big way. down 39 points at 12,403.

facebook less than stellar debut today and jitters about europe's debt crisis ahead of the g-8 summit which begins at camp david tonight all weighing on the markets so far today. the volatility index coming off highs now, as the dow is coming off its lows. they're selling the vix and it's back in negative territory, down a fraction at 24.37. it's settled above 20 every day this week. so yellow flag territory. >> it really has. john liu looking at jpmorgan and chesapeake energy. he's looking at a clawback. and yesterday he wrote chesapeake shareholders to oppose the re-election of two directors. >> we welcome the man himself, comptroller of new york city, john liu, who oversees the pension funds. 10.8 million shares of jpmorgan and in chesapeake. the question i have often asked

people when did it become illegal to lose money? i mean, that's simply what happened here. they made a bet, they have lost admittedly a lot of money. >> bill, it's a huge loss. it started out at an estimate of $2 million and it could go as high as $5 million, that's a lot of money. but what we're concerned about is these major corporations have clawback provisions. we're simply asking the board of directors at jpmorgan to look at those -- to exercise those claw back provisions and to make sure that executives aren't rewarded for taking excessive risks that often run counter to the long-term interest of share owners such as our pension funds. >> what would you have liked the executive team at jpmorgan to have done differently? how would you characterize how they have handled this? >> well, i think it's the board that has the responsibility to investigate exactly what happened, who is to be held responsible. but the point here is this. that when these huge losses are

sustained, it's at the expense of share owners. but why do the executives get to walk away scot-free with the huge bonuses? that's what these clawback provisions are about. >> that's what you're talking about, the investors. but when you put the city's pension money into the stock, you didn't think it would go up every day. >> no, look, we invest in the long term and our interest is not only getting money back from the executives who probably shouldn't have gotten those huge bonuses, but setting the right tone with management as well as the board members that we elect as share owners that they have got to always keep paramount the interest, the long-term interest of share owners. >> now get to chesapeake in a moment here. if you're not satisfied with the message from jpmorgan, you can sell your shares? >> we don't pick stocks, we

don't say we'll buy jpmorgan or sell them or chesapeake or facebook for that matter. and so we rely on our fund managers. but to the extent possible we will always vigorously pursue our share owner rights and that's exactly what we're doing. >> so the positions, about $400 million, you have a $400 million position in jpmorgan? >> unfortunately it's down to probably $350 million. >> that's right. that's right. because we have had a huge market loss this woke. but have you cut that position at all? have you taken anything off the table? >> we are not day traders. we have a $120 billion portfolio and we leave it up to the fund managers to make the day to day decisions. but again, we exercise our rights as share owners. >> you sent a letter to chesapeake. have you heard back on your position on not wanting to have the -- >> we sent a letter to our fellow share owners, explaining that we are going to vote no against the two directors that are up for re-election this year. and we're advising them to do the same because these are two directors that have failed to act in the interests of share

owners. they should have taken action when certain revelations came to light. lation -- revelations that harmed the interest of the share owners. >> would you be poised to put more money to work in equities and would you buy facebook? >> well, in new york city, we've got as i mentioned 120, $122 billion in our portfolio. we're currently undergoing an asset allocation study and rejiggering the portfolio somewhat. to the extent that our fund managers, our equity managers think that facebook is a good buy, i'm sure we'll have a stake in there. we wish then well. >> before you go, you have been very active lately with the calls for the clawbacks to jpmorgan, the -- not wanting to re-elect those board members at chesapeake energy. how much do you feel your message is muted or tarnished by the allegations of campaign finance irregularities in your own office? >> there's a very good question. we're talking apples and

oranges. this is new york city. there are questions about some donations i have gotten. i have no problems with them. i'm very proud of my campaign fund-raising, but this is new york city politics. but what's not -- what is not fungible is my responsibility as a if i official share on behalf of them. and wherever we can maximize the shareholder value we will do so. >> do you regret some of the contributions? >> we have returned contributions that are inappropriate or may be inappropriate. nonetheless, campaign fund-raising is part of the game in politics. but what is not a game is a share owner interests. >> yes. john liu, good to see you. >> good to have you on the program. thank you for joining us. headed to the close, about 40 minutes here. the dow still off the lows of the session. down 36 points right now. well, $30 billion loss in market values since the company announced the massive trading loss at jpmorgan.

look at facebook. very close to the offering price at $38. we're looking at facebook and jpmorgan next up. stay with us. we want your take on jpmorgan-chase by the way. is jamie dimon's reputation frer tarnished by the trading blunder? we'll reveal your responses coming up later today. stay tuned. ♪ [ female announcer ] you're the boss of your life. in charge of long weekends and longer retirements. ♪ ask your financial professional how lincoln financial can help you take charge of your future. ♪ are you still sleeping? just wanted to check and make sure that we were on schedule.

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welcome back. if you're just joining us, this is not the kind of first trading day many people were expecting for facebook. it continues to trade lower now, dangerously close to its offering price at $38. gary kaminsky of our staff was pointing out that he heard that there were a number of insiders that would not want to be holding the stock by the end of the trading day and they would be getting their orders in during their final hour. that seems to be playing out right now. as you can see, it has been falling during this hour of trade and now back to $38.10 and moving lower right now. keep a close eye on this as we head to the closing bell. meantime, gold rallied to the new one-week high on increasing speculation that the fed could announce a new round of easing. we have that story right now. sharon? >> that's been a tremendous move

this week in the gold price, bill. we're looking at a $70 move higher in the last three days or so. we're looking at gold prices that came very close to $1,600 an ounce, that's the target for next week that traders are looking at. they're saying that with the problems that we're seeing in greece, in spain, there are actual facts out there that that they're pointing to are that shows it's well founded. so that is the hope, that is the perception and that is what has turned around the gold price. we have seen it decouples from the riskier assets and you only need to look at the crude oil market to see that. crude oil, the price below 9 dollars -- below $92 a barrel. what a call you made earlier telling us that the investors who bought the ipo want to get out of the ipo by the end of the day today. we're starting at -- we're talking about facebook.

i want to talk a bit about jpmorgan right now and try to figure out how to evaluate. $30 billion decline in market value this week. that's just since last thursday. down $30 billion in market value. all for what the firm says might end up being a $5 billion hit. and with ceo jamie dimon set to testify before congress, is there more pain ahead for the stock or is this a buying opportunity right now? let's talk numbers right here on jpmorgan, on the technical side of things as well as the fundamental side of things. thanks for joining us. let's look at the charts and tell me what you're seeing in terms of whether or not to get into this stock. whether you think it will continue going down. >> jpmorgan is a volatile stock. we have seen these type of sell-offs in the past. if you look back last summer in the august time frame, we saw a $9 decline over 20 days. most of that came back. 40% of that came back over the next trading days.

in november of last year, we saw the same type of thing in 20 days we lost $9. we got two-thirds of that sell-off back over the next ten days. we are seeing another $9 sell-off here, we're down 25% from the high. >> 25% from the high or 25% from when they announced this last week? >> 25% from the high. >> okay. >> and then since the beginning of may, we're down $9. so we think that's extreme, oversold condition. we think that's an overreaction by the market. we think the stock will bounce back. you get half of your losses back, you'll get back to $39 on the stock. >> you're saying you want to buy the stock right here? >> you certainly do. >> paul, let's talk fundamentals here. what do you see in terms of fundamentals on jpmorgan? same story or different? >> well, you have the ten-year yield curve at an all-time low. banks aren't going to trade up with that ten-year at that level. if it continues to fall, jpmorgan is going to go down with it. we don't know anything about the trade. it continues to grow. we don't know big it's going to

get. and there's some unflattering news stories about the whole complexity of the trade. and what does senior management know about the trade? i think we're still on the sidelines, we think it will go lower. >> so you think it's going to go lower. in terms of the extent of this problem, why don't we have a better handle on how much this is going to cost? how much higher can the number go if the firm is even saying it could go as high as $5 billion? >> well, we don't know the complexity of the trade and we don't know how they're going to get out of the trade. we know these indexes that they're invested in. jpmorgan has a lot of liquidity. they can hold on to the positions for a long time. but when it's all said and done, i don't think the market really truly understands what -- how bad the losses can get. but i want to say this. it's not going to put the company in any turmoil. it it's not going to put the

company in a bad way, but it will push people to the sideline. >> what you're saying is you're able to get stock at a better price if you think it's going lower. >> that's correct. >> let's turn back to you, barry. i want to get your technical know how on facebook. let's look at where the stock is right now. we're talking about pennies above where it went public. what does the chart look like and how would you characterize day one of trading? >> the chart looks like zynga and groupon which were failed ipos over the year. it's not linked in. it went straight up. that's what a winner looks like this. this not a good ipo. >> do you think we're sort of flirting with the break even that it breaks below by the close tonight? >> no, i do not because remember how public offerings work. you have the underwriters who are supporting this stock in the $38 level. so i don't think you'll see them dropping it below -- >> having said that, going forward, you're a seller of

facebook or a buyer? >> i'm a seller. this ipo hasn't worked. it doesn't work the first day i don't think it will work. >> thank you for your fundamental analysis on jpmorgan. see you guys soon. >> a good reminder, yes, it would be virtually impossible for it to break that $38 level with the underwriters there, but we do have it now at $38.10. now 14 cents not at all the kind of opening that many were hoping for and expecting from the highly expected ipo in quite a while. we'll have more on the facebook story as we continue on "closing bell" for this friday after this. tdd# 1-800-345-2550 we're hitting new highs. tdd# 1-800-345-2550 and i'm on top of it all with charles schwab. tdd# 1-800-345-2550 tdd# 1-800-345-2550 i use streetsmart edge and its tools like... tdd# 1-800-345-2550 screener plus - i can custom build my own screens tdd# 1-800-345-2550 or use predefined ones. tdd# 1-800-345-2550 and i can trade wherever i want, tdd# 1-800-345-2550 whenever i want.

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the story of the day as we knew it would be, but not the kind of story we were expecting. after about a 30-minute delay this morning past the time when it was expected to trade, they finally got the first print on facebook this morning. above the offering price of $38, fleetingly traded at $45. didn't see that price again after that and now it's coming close to that price once again. we're at $35 and a nickel.

>> amazing how close it is. you know, i really think what barry was said was interesting. he said if it's not working on day one, why would i trust it 30 days out? let's bring in the market pros for their reaction on the ipo today. good to see you both. thanks so much for joining us, gentlemen. let me get your take, jim, on the facebook deal. >> not good as you just mentioned. if it doesn't work on day one, history shows very few ipos come out and rally right back up. if this was the big hope to get retail investors back into the market, we'll need that -- >> what happened? i mean, you know, going into this deal, everybody is talking about all of the hundreds of millions of users of facebook and how they're making money on this business model. so what happened? how come it fell flat?

>> i think that the story is that the underwriters overpriced it. i think they reached too much and this investors thought the $38 price was too high and their initial reaction is to sell. >> zach, you have to know that the underwriters are going nuts today and, i mean, we're right now at $38.03. as a trader, what do you make of this fiasco today? >> you know, i'm not sure i characterize this as a fiasco, given the day on which this happened and the week in which this is taking place. so you can't control your timing with an ipo. you know, if this had come out six weeks ago and the markets seemed much more stable, it could have been up 25%. >> do you think so? this one did feel like it would be immune to any market conditions, but you think to some degree it has succumbed to some of the negative any in the market right now? >> oh, yeah. even though the valuation is half the size of the greek debt, i think in the macro driven environment we're in, flat with

a new company at a high valuation with a business model that should have some skepticism, right? the fact that this may not work well doesn't mean that it won't work well. but really, this has been a terrible week. and the fact that they're getting the largest -- third largest ipo ever and a decent price, i'm going to take the other side of this. i think the judgment that this is terrible is really misplaced or at least premature. >> well, zachary, i'm getting an e-mail from rich repetto who is a financial services analyst and he's talking about the impact on nasdaq. by the way, look at where facebook is right now. we're basically at break even here. we'll see if there is that support at $38 and it doesn't break that. but basically, repetto is saying that nasdaq was supposed to collect a price that would best

match or equal the buy or sell orders and the system has got somewhat overwhelmed and they couldn't send back trade confirmations. i mean, this is a real black eye in the face of, you know, so many questions about market structure already. >> right. and then the fact that because it didn't have quite the pop or at least the lasting pop as you noted before, it the have a bit of a pop, that set acetone wh when -- that sets a bit of a tone. this is not a buy market any day this week. it was either no volume or sell volume. so again i think we have to look at this necessarily as a facebook thing. we'll know in the next weeks or the next months if it is indeed a facebook thing. but talk about bad days to go public. >> yeah. i guess. obviously. $38.03 right now. thanks for joining us. and as that deal continues to be muted on facebook this market is worsening. we have about 20 minutes until the closing bell sounds.

once again, financials among the weak spots. >> we want to put it in perspective, facebook versus the ibook. facebook stock had some work cut out for it. if it wants to rival apple's historic ride. we'll look at which ones will give the investors the best returns. >> and it's that time of the year, graduation time. yesterday, i had the honor of being a commencement speaker at nyu stern business school and it was a real honor, bill. even though a lot of people are talking about the economy being terrible and, you know, tough to get a job, college graduates have a much better shot than without a college degree by the way. >> at what cost right now? i mean, the high cost of college is a huge issue today and for the next generation as well. >> absolutely. that's part of my observation on the skyrocketing cost of college. is it actually worth it? we'll talk about it later on in the program. but first, before we go to

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just before the break as part of the dividend, we asked which internet stock has shot up the most so far this year? amazon.com, ebay or priceline.com? now, the payoff. priceline.com. which has surged more than 35% year to date. okay. obviously facebook's ipo the big story today. it trades in the nasdaq market system and the fact the nasdaq had trouble getting that stock opened, getting confirmations to customers who had orders in today, bertha coombs is at the market site with more on that. >> yeah, it's certainly a rough debut and not the way that anyonepictured it was going to go. the only thing that facebook has

lived up to in terms of the hype is the volume. right now we're at 510 million shares. it is defending $38 here. i have not seen a trade below $38 yet, but this is going to be the number to defend to go into the close and a number of traders saying this is the sentiment barometer right now with this huge float today and the fact that we didn't get a pop. certainly the sentiment as far as nasdaq's own stock today. you look at that interday trade and you can see as we heard about more glitches about confirmation of the execution of that ipo cross, not understaincy some firms are just now getting confirmation and that's weighed on nasdaq's own stock today. back to you guys. >> for sure, bertha.

thanks very much. let's bring in kayla tausche. some have not got the confirmati confirmations. >> and some put in trade orders at $41 a share and still not confirmed. it would be helping the stock right now. just one cent above issue price and take a look at these key levels. i want to point out this $40 line. you see when we went from the $42.05 to the $40 mark, strong, sharp sell-off. when we got to the $40 mark here around 3:00 p.m., sharp sell-off. volume is ramping up going into the close here. it is very, very likely that we could reach another level of syndicate support here. we don't know and we won't know for at least 30 days how much the underwriters will have had to support this stock throughout the day. when it hit the $38 support level here and if it hits it again going into the close -- >> it just did while you were talking, kayla. we're sitting at $38.01 and it hit $38 even a moment ago. you were following the road show as they went along and selling

it and allocating here. to some degree, do you think facebook is a victim of its own success? the demand was so great that they upped the share count and do you think they handed out too much out there to give it a float that was out of their control and you got too many people who want to get out at this point? >> that's what turned hedge funds off, i think. >> yeah, bill, certainly they raised that range up. you know, no harm no foul to price in the middle of the range. issuers do it all the time. they raise the range. it could have priced in the $36 sweet spot, but instead went to the high end there. looks like they may have priced it exactly right, but they have needed to step in and support that. remember, they have $2.4 billion in an overallotment. that is there to stabilize the stock in the event that it does touch that $38 mark at the 30-day -- 30 days from today. we will see a filing as far as what they have been able to use of that overallotment. normally they get more in

proceeds for the company. that what's brought us to the $18.4 million deal size. if they have to use it to stabilize the stock that'll take the deal size down. >> but what happens if a customer thought they were buying at $40 and they're seeing the print at $42? >> i mean, the caveat emptor. if you have a queue this long as far as volume, then, you know, it will take a long time to affect those trades especially on day one. i think that a lot of investors are learning a lesson today. if something has this much interest regardless of what you think of valuation it might not be physically possible to process the trades. >> let's bring in david curl, also jason thomas joining us as well. gentlemen, good to see you. thanks for joining us. did you buy facebook? >> no, not on the open today. no. >> do you have any plans to at some point? what's your take on what's going on today? >> i sure will. thanks for having me on the

show. those of us on the west coast, this is a big day for us. we bought in the secondtaary so this is a big day. despite the weak performance, a valuation of the capital model we're familiar with. the sophisticated retail investor, i would say three things. you need to understand this is a speculative adventure. it's not so much what we know about it, but it's what the market doesn't. that's where the excess returns come from. you have to understand the dynamics of ipos and i think retail investors think they're fighting against the stocks but really they're fighting against the person who's selling them the stock. who's right and who's wrong. finally, i would say get some professional help. you know, it's not true that the only decision you have is buy or don't buy. you can do trade using two different stocks, you can manage the risk of the position. these are tools and strategies for professionals, but no reason somebody shouldn't get professional help. >> david, what about you? and what about what barry fine

just told, us, if it's not trading well on day one, why would i trust it on 30 days out? >> well, the valuation was high, no question about that. it was five times higher than apple. and number two, they sold too much stock and over the next 90 days and 180 days there's actually going to be double the amount of stock being sold. so i think they're just trying to float too many shares. when we see this much retail stock investment, in other words, retail brokers got a lot of these shares, that is not healthy. it means that probably they were stretching to get all of this stock sold. >> yeah. let's bring in our friend, dougie cass who is sitting by the pool in florida there. and i know that last december this was one of your predictions for 2012, that we would see a fizzle for facebook on its ipo. so we'll give you a props on

that, but what do you make of how it's played out this first day? >> thanks. nice to be with you, bill. the last time i spoke with you, you were the moderator of a town hall meeting on cnbc. talking about real estate, if you remember, in 2006. i was a naysayer with bob shiller. >> yes, i remember. >> i would say the problem with facebook is, one, market externalities and two, facebook internalities. when i talk about externalities, i think the overriding concern with investors today is not -- it's not the pathway or the gateway to the internet, facebook, but rather greece and problems with the peripheral countries in europe. >> hey, let me ask you, i mean, there's got to be some trepidation to put it mildly on what to do now that it's trading right at the offer price here. their job is to keep it here. do you think they will, doug

cass? >> that would be a guess, bill. i think one of the second problems with the stock was the placement of the stock. not only the size which approached $20 billion, but it had a disproportionate amount of retail placement and i think that the retail investors got fidgety. >> do you blame them? >> i don't think even 3% read the prospectus. >> that's the user base. >> right. the only -- the problem with this issuance and we have seen this before in recent ipos is that there are the structural issues facing the exchanges which have not been yet addressed. technically they're ill-equipped to deal with the magnitude of the volume and the fact that the volume is coming from different exchanges. >> right. >> and this sort of ipo exposes these problems. >> okay. doug, thank you.

i'll let you get back to what you're doing in there. let's bring in melissa lee from the nasdaq markets. here we go again. it was a tough open and it will be a tough close. >> it will be a nail-biter, bill and maria. i have on my screen the low on the stock for the session and that was $38 a share. as we go into the close, you know, we'll watch that level very carefully. what i'm hearing from the trading desk is that morgan stanley and jpmorgan, the two top underwriters were heavy into the stock this morning to defend the $38 level. that's when we saw it bottom out in the morning and in the words of this person, they are literally standing over the trading desk to make sure that $38 level is defended. i'm in doug's camp. i believe they'll do everything in their power to make sure this closes at $38. otherwise, this will be a failure and as doug cass had mentioned also the fact that so many retail shares were placed in this offering, that was a warning for institutional investors and they don't want to hold on to the thing going into the weekend.

>> how long can they do that, melissa? ten minutes to go maybe it doesn't drop today. maybe tomorrow or monday or next week. >> exactly. >> how long can you defend it? >> well, that's a good question, maria. i don't know how long they can defend it, especially when in 90 days there's a huge lockup -- and the float is going to increase by 55% in 90 days and double in 180 days. so the stock is facing challenges today. two times it was going to reach $38 a share. two times on the first day of trade, imagine what it will be when it hits that lockup. >> david pearl, the stock market is a risky adventure, right? >> right. a big difference between a good company and everybody knows facebook and they know it's a good company and what's a good investment? and a good investment you have to have the right valuation, you have to manage the amount of shares that are being sold. you have to have a good idea of the business model and facebook has some challenges versus some of the other companies like apple or microsoft where it's

pretty obvious what their growth path is. >> i think that's true. but i think it's also there's a difference between a good near-term investment and a good long-term investment. and i'm in the karabell camp. if you look at what's happening out in the world the retail investor is getting spooked. i think that a week is an eternity in this kind of a world. who knows what's going to happen in greece. but that once we can move beyond some of the short-term concerns i think we'll begin to see what some of the long-term opportunities for facebook are. >> yeah. just remind everybody, the dow is down 95 points with about eight minutes to go. so we have other things going oen in the -- going offen in the world. the g-8 meeting is tonight. so a lot of fundamental factors that are weighing on the market besides the problem of facebook. >> i think it's partly facebook. look at this market, you see this deal. it is flat and not, you know, not doing as well as so many people thought and you saw the market. so i think it's all part of

that. as well as greece. i agree with you on europe. but this is a jpmorgan/facebook story today. >> kayla tausche, what do you think they're thinking at facebook? >> i think they're thinking our stakes are worth what they were last night. i think the big story here is value creation. how many employees we're going to be turned into millionaires overnight. what mark zuckerberg was going to be worth, it looks unchanged. it's a known, known variable here. so -- >> i think -- don't you think that the underwriters might at this point consider it a victory if they can keep that at $38 by the close? >> i think not a victory. they will be hanging their heads if it sticks at $38. the people i talked to as i reported throughout the day, they hoped this would rise more than gm did because it's such a mammoth deal. the volume is really the issue. when you're pushing something this large out into the market,

you can't really get the giant pop like you'd see from linked in. of course, morgan stanley led the deal and so gm rose about 5%, had 458 million shares traded. facebook by volume would exceed that, and during the day when you saw them architecting that rise above $40 and trading throughout the day, after they did massive buying, that was appearing to be a success. in the 5% to 10% range. as soon as they get to that support level, there's a heavy amount of selling. >> are there implications if it were to trade or close below $38 at this point? it's sitting right on that number. you have to know there's a mighty stand going on right now at those underwriters' desk to keep that price. >> and we know for sure it's the underwriter's job to support this stock. it's their job. and especially morgan stanley's job. and they allocate that

overallotment only in emergency situations. they're trying to support this going into the close right now. and it's still at $38, i won't go below $38 because they won't let it. they have tons of tactics they can use if they want to. there's some speculation that there's some shadow bids out on the market. some whispers of a block trade that didn't exist at $35 to drum up some positive sentiment. >> is that legal? >> have you been to a trading floor? >> i don't think so. >> it depends on where it comes from. >> let me ask you this. there's been so much excitement around facebook and it's triggered an enormous amount of money going into other technology names. what does the -- well, what does the failure or upset of this deal do to that enthusiasm around social media and technology? remember that senior executive, bill, who said to me, yes it's a

bubble and yes it will end after facebook goes public. >> yeah, i think that's fair. but i think that as far as this great expectation, i think that that was coming from the buy side. as far as the people who were managing this offering, they really thought that because of the size and i mentioned gm earlier that it was going to be a mammoth to take to the market regardless of the sector and regardless of the type of company that facebook is. it was just so large, the volume is going to be huge. they needed to build a gigantic book so that was really the comp here. i think that the buy side community really had high hopes for this. you look at zynga down 15%. names like groupon and all the secondary trading shops that set up to trade facebook and people have really high hopes here, but necessarily on the sell side that wasn't there. >> right. i mean, we're all -- we can all point to why this stock is doing what it's doing. you know, the overallocation. whatever it is. but i don't think we all expected to have to come up with those reasons why it was doing that. so there was every reason to

believe that the demand was going to be so strong especially from the orders coming in today that this stock would go higher. is this merely a failure of technology? i mean we still hear -- we're getting e-mail. >> a lot of people question the 100 billion valuation -- >> i understand that. but people are saying we have yet to get a confirmation on an order they put in this morning. >> yeah, i got an e-mail from someone saying i use fidelity, now i'm stuck. >> and some were at wells fargo, still nearly into the market close and they haven't gotten confirmations. you have to wonder to what extent nasdaq has played a role in this offering. i say to what extent because we know it played a role. it's unclear how big a one. they said earlier today that they have confirmations that they have all been delivered but clearly from the messages we are getting they haven't. when i hear about possible

trades at 42, that aren't making it to the market, how would the stock be trading if they were all getting processed? >> it was at $38.35 and now it's back to $38.07 with two minutes to go before the close. let's bring in david faber and your thoughts on what has been a -- well, it's an eventful day, but not the kind of events we would have expected. >> this is more exciting than the open. >> you're right, maria. watching it hold that $38 level you can imagine all the guys at morgan stanley, buy buy buy! >> exactly. >> holding the line. you know, earlier i talk about in part a billion dollars. that was in in addition to the $2.4 billion green shoe that they have available. some people telling me there's a lot of ammunition to maintain that line. being $38. don't let it cross below that. we have seen it hold at $38. i don't know countless times i saw $38, $38.01. if you want to know how much the underwriters spent, you'll get your answer because that was all them. that was every single one had to

be the underwriting coming in and buying at $38. you know one other thought though overall in terms of what has not been a performance that anybody might have expected at the beginning of this day. they did increase the size and the price of this offering not long ago. many underwriters would tell you that's hard road to go down. both size and price, they expected the demand would be there. clearly they were a bit off, but they are able to at least say, hey, we held syndicate bid with what 50 seconds to go in the trading session. >> would there be implications if they were not able to hold the bid? >> it would just be a confidence killer. not that this is helping the confidence in a very tough market right now. part of this has to be macro, one would imagine with the s&p, with the concerns about europe and the overall economy and the world. there's got to be a macro element that facebook is getting caught into. this is more of a confidence killer. >> let me ask you, do you think this is evidence that obviously