In a comment to my Facebook IPO post, Steve Bainbridge asked: "How does the fact that Morgan Stanley had to intervene to keep the price from dropping below $38 factor into your analysis? Zuckerberg may be laughing all the way to the bank, but are the underwriters?"
The short answer to Steve's question is, of course, that the underwriters are sobbing into their single malt scotches and trying to piece together what went wrong. I share Steve's skepticism about Facebook's path to profit, which has an Underpants Gnome quality to it. But, given how it has upset our expectations about the underwriters' role, this IPO may be one for the ages.
For the long answer, go check out Usha's very interesting post.
