Tag Archives: Facebook

Wells Fargo’s Artificial Intelligence Defies Analysts, Slaps “Sell” on Google and Facebook, by Wolf Richter

SLL’s bet is on the artificial, rather than the human, intelligence. From Wolf Richter at wolfstreet.com:

Google, which makes almost all of its money on ads and internet user data, is undertaking herculean efforts to get a grip on artificial intelligence (AI). It’s trying to develop software that allows machines to think and learn like humans. It’s spending enormous resources on it. This includes the $525 million acquisition in 2014 of DeepMind, which is said to have lost an additional $162 million in 2016. Google is trying to load smartphones with AI and come up with AI smart speakers and other gadgets, and ultimately AI systems that control self-driving cars.

Facebook, which also makes most of its money on ads and user data, is on a similar trajectory, but spreading into other directions, including a “creepy” run-in with two of its bots that were supposed to negotiate with each other but ended up drifting off human language and invented their own languagethat humans couldn’t understand.

And here comes an AI bot developed by stock analysts at Wells Fargo Securities. The human analysts have an “outperform” rating on Google’s parent Alphabet and on Facebook. They worked with a data scientist at Amazon’s Alexa project to create the AI bot. And after six months of work, the AI bot was allowed to do its job. According to their note to clients on Friday, reported by Bloomberg, the AI bot promptly slapped a “sell” rating on Google and Facebook.

Human analysts on Wall Street are famous for their incessantly optimistic ratings and outlooks. They generally only put a “sell” on a stock after it has already plunged. They’re part of Wall Street’s human hype machine. Their job is to help inflate stock prices and make CEOs feel good so that they will do business with the analysts’ firms and send fees their way. But Wells Fargo’s AI bot hasn’t gotten the memo.

Last month, a group led by Ken Sena, head of Global Internet Analyst at Wells Fargo Securities, introduced this “artificially intelligent equity research analyst” or AIERA. Its “primary purpose is to track stocks and formulate a daily, weekly, and overall view on whether the stocks tracked will go up or down,” Sena, said at the time.

So “she” did Big Data analysis of Alphabet, Facebook, and some other stocks, and after seeing what’s there, averted her eyes in disgust and slapped a “sell” recommendation on both stocks and a “hold” recommendation on 11 other cherished stocks.

To continue reading; Wells Fargo’s Artificial Intelligence Defies Analysts, Slaps “Sell” on Google and Facebook

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Leaked Descriptions Of Infamous “Russia Ads” Derail Collusion Narrative “They Showed Support For Clinton”, by Tyler Durden

“Russian-linked” groups supposedly spent up to $150,000 on Facebook ads and it derailed poor Hillary’s presidential campaign. Never mind that at least $1 billion was spent on the campaign. From Tyler Durden at zerohedge.com:

That was quick.

Less than a week after Facebook agreed to turn over to Congressional investigators copies of the 3,000-odd political advertisements that the company said it had inadvertently sold to a Russia-linked group intent on meddling in the 2016 presidential election, the contents of the ads have – unsurprisingly – leaked, just as we had expected them to.

Congressional investigators shared the information with Special Counsel Robert Mueller’s team, which has repeatedly allowed information about its investigation into whether members of the Trump campaign actively colluded with Russian operatives to leak to the press. Once this happened, we knew it was only a matter of time before the ads became part of the public record.

And, shockingly, descriptions of the ads provided to the Washington Post hardly fit the narrative that Democratic lawmakers have spun in recent weeks, claiming the ads – which didn’t advocate on behalf of a specific candidate, but rather hewed to political issues like abortion rights – were instrumental in securing Trump’s victory.

After initially denying the story this spring, Facebook came clean earlier this month, saying its investigators had discovered that the company sold at least $100,000 worth of ads – and possibly as much as $150,000 – to Russia-linked group that bought the ads through 470 phony Facebook pages and accounts.

WaPo reports that the ads represented issues on both sides of the ideological spectrum, which would suggest that the buyers didn’t intend to support a specific candidate, but rather their own unique agenda.

The batch of more than 3,000 Russian-bought ads that Facebook is preparing to turn over to Congress shows a deep understanding of social divides in American society, with some ads promoting African-American rights groups including Black Lives Matter and others suggesting that these same groups pose a rising political threat, say people familiar with the covert influence campaign.

The Russian campaign — taking advantage of Facebook’s ability to simultaneously send contrary messages to different groups of users based on their political and demographic characteristics – also sought to sow discord among religious groups. Other ads highlighted support for Democrat Hillary Clinton among Muslim women.

To continue reading: Leaked Descriptions Of Infamous “Russia Ads” Derail Collusion Narrative “They Showed Support For Clinton”

Facebook Exposed – “You” Are The Product, by John Lanchester

This is a long but very worthwhile article about Facebook and Mark Zuckerbook. You are indeed their product. From John Lanchester at the London Review of Books, via zerohedge.com:

At the end of June, Mark Zuckerberg announced that Facebook had hit a new level: two billion monthly active users. That number, the company’s preferred ‘metric’ when measuring its own size, means two billion different people used Facebook in the preceding month. It is hard to grasp just how extraordinary that is. Bear in mind that thefacebook – its original name – was launched exclusively for Harvard students in 2004. No human enterprise, no new technology or utility or service, has ever been adopted so widely so quickly. The speed of uptake far exceeds that of the internet itself, let alone ancient technologies such as television or cinema or radio.

Also amazing: as Facebook has grown, its users’ reliance on it has also grown. The increase in numbers is not, as one might expect, accompanied by a lower level of engagement. More does not mean worse – or worse, at least, from Facebook’s point of view. On the contrary. In the far distant days of October 2012, when Facebook hit one billion users, 55 per cent of them were using it every day. At two billion, 66 per cent are. Its user base is growing at 18 per cent a year – which you’d have thought impossible for a business already so enormous. Facebook’s biggest rival for logged-in users is YouTube, owned by its deadly rival Alphabet (the company formerly known as Google), in second place with 1.5 billion monthly users. Three of the next four biggest apps, or services, or whatever one wants to call them, are WhatsApp, Messenger and Instagram, with 1.2 billion, 1.2 billion, and 700 million users respectively (the Chinese app WeChat is the other one, with 889 million). Those three entities have something in common: they are all owned by Facebook. No wonder the company is the fifth most valuable in the world, with a market capitalisation of $445 billion.

To continue reading: Facebook Exposed – “You” Are The Product

Is It March of 2000? by Karl Denninger

Financial markets are never rational, but sometimes they are especially irrational. From Karl Denninger at theburningplatform.com:

There was a little company called “Micro Strategy” (by the way they still exist.)

In the first week of March the stock had skyrocketed by over 50%.  The next week it “checked back” most of those gains.

The following week the stock collapsed.

A couple of weeks later, the Nazdaq cracked big.  I was house-shopping, in a hotel, woke up to CNBC full of crying babies and chuckled.

I will note that MicroStrategy was a little dogsqueeze company.  In terms of market cap it was a nothing – literally.  Even today, 17 years later, it’s a little $2 billion firm — granted, much smaller today in market cap than it was then.

In the run-up of the previous weeks and months there had been plenty of indications of trouble.  Many companies had reported slashing prices, increasingly-saturated markets were well-understood and of course there was the “burn rate” nonsense of the period.

It’s arguable that it was that MSTR collapse that upset the apple cart.  You see, when people are buying stocks of companies that have nothing but negative free cash flow as far as the eye can see or sky-high P/Es of 60, 80, 100 or more they’re betting with their eyes taped over on exactly one thing: Indefinite exponential growth of the business and, of course down the line, profits.

The problem is that this is an impossible premise.  There is no way for that to ever happen because it is mathematically impossible.

Today we have Amazon, Facebook and Apple all priced in this way.  Of the three only Apple has some argument for its valuation, but even there given the recent run of almost 50% it’s priced for indefinite exponential growth of a saturated product — iPhones.

To continue reading: Is It March of 2000?

Who Will Watch the Watchers? by Uncola

Nothing should make people feel better than an announcement from a major technology and social media company that it will be watching out for them. From Uncola at theburningplatform.com:

On December 15th, 2016 Facebook announced a series of measures designed to address what they have termed the “issue of fake news and hoaxes”. The assault on fake news by Facebook will consist of four initiatives including: Easier reporting by readers, flagging stories as disputed, informed sharing and disrupting financial incentives for spammers.

If Facebook readers, in their infinite wisdom, decide a certain shared story is a hoax, they can simply click the right hand corner of the post. This is great. Why, it might even make the Facebook community a last line of defense in the online information war. I don’t know about you, but I, for one, am going to sleep much better knowing this. What could go wrong?

Next, in order to flag any story as fake news, Facebook has started a program working with third-party fact checking organizations that are “signatories of Poynter’s International Fact Checking Code of Principles”.

Thirdly, “Informed Sharing” is explained by Facebook in this way:

We’re always looking to improve News Feed by listening to what the community is telling us. We’ve found that if reading an article makes people significantly less likely to share it, that may be a sign that a story has misled people in some way. We’re going to test incorporating this signal into ranking, specifically for articles that are outliers, where people who read the article are significantly less likely to share it.

To continue reading: Who Will Watch the Watchers?

We Still Have A Word For It, by The Zman

If your revenue depends on the metrics that you keep, and your metrics are exaggerated, isn’t that fraud? From the Zman on a guest post at theburningplatform.com:

I’ve always been a skeptic of Facebook, mostly because I don’t understand how they make money. I mean, I know how they make money, but I don’t know why they make money. It’s just a crappy platform for the technologically inept to post pictures of their cat. Facebook charges companies a fee so they can put ads next to the picture of your cat, but why those companies do it is a mystery to me. The whole thing depends upon ordinary people being interesting and looking at those ads, which no one does.

You can’t cheat an honest man and the companies buying ads on Facebook are not Boy Scouts so it is no wonder that Mark Zuckerberg has been hustling them.

Mark Zuckerberg has a credibility problem.

The tech mogul’s Facebook just admitted to finding more “bugs” in the way it measures ads — and once again, those bugs benefited Facebook.

The social-networking giant said Wednesday it has found numerous errors in the ways it calculates how many people view its ads, artificially inflating their perceived value to advertisers and publishers.

Key metrics that Facebook has exaggerated include the weekly and monthly reach of marketers’ posts, which got inflated by 33 percent and 55 percent, respectively, as the site improperly included repeat visitors in its figures.

Elsewhere, Facebook admitted to exaggerating the number of full views that video ads received, as well as time spent by users reading fast-loading “Instant Articles” for publishers including The Post and the Wall Street Journal, both of which are owned by News Corp.

Facebook insisted that the messed-up metrics — which followed the company’s admission in September that it had inflated its reporting of video viewing times to advertisers by as much as 80 percent — didn’t affect billing to publishers and advertisers.

This stuff is not new. It appears to be the business model for Facebook. This video from a couple of years ago sounds a lot like what is in the NYPost story.

 

The Fed Launches A Facebook Page… And The Result Is Not What It Had Expected, by Tyler Durden

This is probably the first time the Federal Reserve has received this kind of negative feedback; it gets nothing but adulation from the press and financial market participants. From Tyler Durden at zerohedge.com:

While it is not exactly clear what public relations goals the privately-owned Fed (recall Bernanke’s Former Advisor: “People Would Be Stunned To Know The Extent To Which The Fed Is Privately Owned”) hoped to achieve by launching its first Facebook page last Thursday, the resultant outpouring of less than euphoric public reactions suggest this latest PR effort may have been waster at best, and at worst backfired at a magnitude that matches JPM’s infamous #AskJPM twitter gaffe.

Here are some examples of the public responses to the Fed’s original posting: they all share a certain uniformity…

To continue reading (further non-complimentary comments): The Fed Launches A Facebook Page… And The Result Is Not What It Had Expected