In Arman Mazhari’s blog post about facebook’s new advertisement, it discusses two agreeable points:

1)      Facebook’s new ad seems ineffective since they are an advertising behemoth anyways

2)      This ad will bring the message to people who don’t know much about Facebook

In my perspective, the point of this ad isn’t to attract users onto Facebook; they are trying to attract investors and companies. General Motors, which invested $10 million annually to Facebook for advertising, decided to terminate their business deal in May and “unliked” them. Although $10 million isn’t a lot compared to the billions earned annual by Facebook, this is a sign that large companies are beginning to lose confidence in Facebook.

The new ad by Facebook is demonstrating that their 1 billion active users are still here, and they aren’t affected by stock prices or other news. To those who want to advertise or is wary about it, Facebook is still the best since it can target specific people out of their 1 billion active users. Its efficiency is another story as it may depend on which industry, for example, video game in Vancouver vs. real estate in Nunavut, but it does reach a large market which newspapers and television can’t do.

Youtube is popular and grew because of the diverse content that was uploaded by millions of people around the world – from gamers to dog-lovers to parents who upload videos of their children.

Now, Youtube decides to invest millions of dollars to promote high production film makers in creating and uploading videos to Youtube.

This entails a decrease in views of normal and sub-par videos, as viewers are going to watch higher quality videos with the limited amount of time they have. This will dissuade current video makers from creating new content on Youtube as they can’t compete with the higher quality videos.

Youtube is losing its value proposition. Once they are filled with professionally made videos, it would be indifferent from television, where there are professionally made shows and movies along with long commercial breaks. The only point of difference between TV and Youtube is that one is seen from computer and the other from TV.

Once it has established this new image, current video makers could upload their content to other sites, such as Youtube’s competitors, thus, gain popularity. Viewers, who contribute to Youtube’s income, could leave and watch from other websites with more diverse content.

I have always thought that renting a house is a bad decision since money is gone once spent, unlike buying a house where the cash is converted into another form of asset. This article provides reasons why renting is better than buying (perfect for Vancouver’s expensive houses!).

In terms of finance, we need to determine whether the money saved has a higher value now or in the future. There are three key points:

1)      Renting is usually cheaper than paying for mortgages every month plus owner expenses

2)      House prices are high and should fall in the future

3)      How high are mortgage and savings rates?

Simply put, assuming house prices are at its peak, the cash being used to buy a house would have a lower value in the future once house prices drop. It would be better to save the cash and invest it or earn interest in the bank until house prices drop (meanwhile I rent a house). Secondly, if mortgage and savings rates are high, I would definitely keep my money in the bank until mortgage rates and house prices drop. Not only am I not paying for the high interest, I’m also not losing asset value once the house price drops because I never purchased one yet.

 

 

Bibliography:

• “Comparing Neighbourhoods – Vancouver.” Www.cmhc-schl.gc.ca. Canada Mortgage and Housing Corporation, n.d. Web. 06 Oct. 2012.

• Neary, Claire. “The Globe and Why I’m Going to Wait to Buy a House and Keep Renting.” Www.theglobeandmail.com. The Globe and Mail, 17 Sept. 2012. Web. 06 Oct. 2012.