Sirwin
Sirwin

Some stocks I watch - Facebook

By AlexVan | Alex Crypto World | 28 Nov 2020


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Hi,

some weeks ago, I've started a new challenge, where I present some of the companies that I follow for a buy&hold.

The companies need to fulfill over 70% of my criteria to even land in here.

This are:

  • are they going to be around in 25 years
  • are they market leaders
  • does the company expand or invest in research
  • does the company have a solid board
  • can the company recover if it is hit by a scandal or recession
  • was ROI over 3% in the past 10 years
  • shall not be in a communist state

 

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For today, I want to go to a stock that I was thinking as overrated. Yesterday evening, my mind has changed. Why? @taskmaster4450 made a good posts that you can check in here.

The company that is today in focus is Facebook and their project Libra. I did not see the news on any head page, but after searching for it, it appeared. More details can be read for example in this Reuters article. In the media it is presented as a back lash that Libra is pegged to the USD. I think it is even better for Facebook as the speculation volatility is gone. Facebook can issue so many Libra as needed. When someone pays is some 100 USD it will get 100 Libra. Libra has value only in the Facebook world, which is huge. It has 2 billion accounts. In the past years it has build it's own market place.

It will allow transfers in countries affected by inflation like Venezuela, where USD is not so good seen. Yes, it can transfer the USD in countries that have issues with it. It is not called USD, but Libra and will be issued in Switzerland not in the USA.

It will rattle the financial market as a company will be able to provide a stable coin at zero fee. Buying Ads will be with Libra. Most services offered by Facebook will be paid with the new coin. Billions of people having access to it. It will have the budget bigger than most countries in the world. Not that there is Apple and Amazon who have the budget, but this company will be able to print money on it's own.

 

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Now getting to the things it brings, it will push the digitization of money, without being it issued by a state organisation. This will be a push towards crypto and people acknowledging the possibility of such issued currencies.

It is also a threat for crypto, as crypto is still very hard to use for the common masses. Facebook will probably be a no-brainer. This is a challenge that the crypto world needs to tackle.

Also the crypto world needs to show that Libra is not a safe coin as Facebook will be able to delete it or close accounts, censor them and freeze the funds. It is not a blockchain technology and data can be manipulated.

Crypto is safe from this point of view. This would be the advantage and long term it will help the crypto world as damaging it. Damage will be at start, where people might switch to Libra due to it's stability. After realizing the danger and the issues with this model, they will come back.

 

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Now back to the stock. When they release Libra, the share price will rise, I think going over the 350 $ mark after the launch. I might do here a speculation buy for a couple of shares, holding them for a year and sell them. I keep shares for an year to avoid paying taxes, as this is the law in Germany.

 

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I'm not a financial analyst or professional, so what I write here is not an advice and shall be seen as a personal view.

Posted initial on LeoFinance Beta

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AlexVan
AlexVan

I like writing and crypto. I try to combine both by posting. You can also find me at https://leofinance.io/@alexvan


Alex Crypto World
Alex Crypto World

Welcome to my crypto world. I'm a passionate writer, even if not the best one, but I have fun. I also love crypto and try to match this two together. I'm not an financial analyst and what I write is pure out of my perspective.

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