The Tycoon Report

QUESTION OF THE WEEK: Should you be all Ga-Ga for Google?

IF MY MEMORY SERVES ME CORRECTLY, I've answered the Google question recently in this very same column.

But it seems that a recently published "BUY" report, issued by the illustrious firm of Goldman Sachs, has many of you bent out of shape. That's right. I've recieved over 20 questions this week asking whether I think Google, in light of this "new information," is now a "buy."

So I've decided to answer the question again and for the last time. Why not? I just finished stuffing my Thanksgiving-day face. And I've just snuk into the private office in my folk's house. So before I slip into a turkey-induced meat coma, I'll say what I have to say.

But One Caveat Before I Go Forward: Normally, I give the person who asks the question credit for the question. I can't do that this time. There are too many of you. So, while you won't see your name illuminating the pages of this column, at least you'll know where I stand once and for all.

Here we go:

Whenever Goldman Sachs writes a big report touting a company it pays to read it. Especially if you're in need of toilette paper. Yes, you heard me correctly - Toilette Paper. While Goldman Sachs is very adept at making money for it's

Check this out: http://www.google.com/press/pressrel/ipo.html

It will show you that Goldman was one of the underwriters that took Google public. An investment banking relationship doesn't end when a firm like Goldman Sachs takes you public. It just begins. For example, Google currently has 40 million shares in the float. Appx 225 Million more are now free trading. What that means is that all of the insiders who own stock real cheap are going to be selling it to the market.

Put yourself in Goldman Sach's shoes. They want all the Google insiders to sell the stock through their firm so that they can get commissions. In addition, they want to prove to the insiders who are going to reap millions that they can help them make many more millions if they let Goldman Sachs handle the sale.

If Goldman does this well, they not only get commissions for managing the sale, but they get the first phone call when Google needs an investment bank. Therefore, I would be VERY WARY about any reports issued by any of the underwriters for the next 12 months.

I'm not saying there is anything crooked going on. I'm just saying that if you don't know who the patsy at the card table is than you're it! In all seriousness, thanks to everyone who sent their questions. It was well worth the heart burn.