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GOOG decline an effect of Arbitrage? PDF Print E-mail
Written by GMJ   
Monday, 31 March 2008

Having looked at the GOOG stock over the past months, it's pretty obvious that the giant has a few problems to address.

52Wk High: 747.24 ||

52Wk Low: 412.11 ||

@time of post: 436.53

Stats since Jan 1, 2008:

2-Jan-08 692.87 ||

28-Mar-08 447.46 ||

Google has quite some explaining to do as the decline has their shareholders worried, Wall Street analysts are questioning Google's strategy and business model and Google steadfastly reassures that everything is under control. Is it?

I'm wondering; we've seen a steep decline since the rules of arbitrage have changed. GOOG is excluding parked sites from being indexed and drives the costs of arbitrage for sites that THEY! perceive as non conform to their business model, into oblivion.

In addition, YHOO has set steps against arbitrage, at least in the matter of Parked.com and a few other parking providers. This is inevitably contributing to the stock decline. imo Maybe it's incorrect to draw up some parallels, but since GOOG is missing on $xxx millions of dollars in ad revenue from domainers, it's bound to have an effect on GOOG's stock performance. Is the decline solely the effect of loosing revenue dollars by domainers having seized (voluntarily or involuntary) their campaigns?

Or, thinking about US economics of late, are we just part of the bigger picture that's ailing GOOG?

The other side of the coin would be: Has Yahoo found a way to impact Google's overall performance? By disabling hundreds of millions of dollars in cash flow, running parallel with Google's overly critical and preferential requirements of website content, does this spell the inevitable doom in the long run?

Leave a comment below or take part in the discussion on the Forum

 GMJ

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Last Updated ( Monday, 31 March 2008 )
 
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