After the biggest stock market sell-off in history, what's next for Facebook?
Social media giant posts big profit, but other numbers show potential long-term problems
When
Facebook posted its quarterly results on Wednesday, the stock market
sell-off that followed was dramatic. By the time the market closed the
next day, the company had lost $100 billion in shareholder value. It
was the biggest sell-off in Wall Street history.
A market meltdown like that inevitably left the company's investors wondering "What's next for Facebook?"
After all, it wasn't a set of ugly numbers that sent investors to the exit. The company still made gobs of money — more than $5 billion in profit, in fact. But the sell-off was sparked by fears that the endless growth may soon come to an end.
To Ramona Pringle, a CBC columnist and media professor at Ryerson University in Toronto, the company's main problem is the same one that has felled many of its technological ancestors — you're cool, until you're not. And to young people at least, the world's biggest social media company is decidedly not.
"Talk to anyone under 22," she says, "and they're not on Facebook."
To
the younger generation, Facebook is reminiscent of that old joke about a
high school party — it's all fun and games until somebody's mom shows
up.
Whatever young users the service does have, Pringle says, they basically just use it to "check in with their mom and share photos with their mom."
And the generation that follows is even less likely to sign up in droves, she says.
For a company that sold investors on its prospects based on endless growth, that's a problem.
Facebook use is still growing in Asia, Africa and the Middle East. But it's declining in Europe and basically flat in North America — by far the company's two most lucrative markets.
"At least when it comes to North America," Pringle says, "they kind of maxed out."
Which is part of the reason why investor Ophir Gottlieb says this week's sell-off makes sense.
The president and CEO of Capital Market Laboratories says Facebook got punished in part because of lingering fears from the Cambridge Analytica scandal, which revealed Facebook allowed an outside consulting firm to collect personal data on millions of users and sell it off to try to influence elections in the U.K. and the U.S.
"This is really where Facebook's lack of transparency during the data scandal and the election scandal is now going to boomerang and hit them," Gottlieb says.
Despite the eye-popping profit figure of $5.1 billion, Gottlieb rattles off a series of metrics that show why the stock plunge was at least partly justified based on the numbers alone.
The company increased its headcount by almost 50 per cent as it went on a hiring spree to make good on its post-scandal promises to protect data privacy. But by its own admission, its revenue growth is slowing to about 25 per cent a year, which has pushed the company's profit margin to about half of what it used to be.
"Add up slower user growth, slowing revenue growth, and expenses growing faster than revenue for several years out," Gottlieb says, "and that's a recipe for about a 20 per cent stock drop."
Those might be fixable, short-term problems, but the company is still left with what he calls "the elephant in the room" — people are just getting fed up with Facebook.
"We don't really know if the slowing user growth is because people are getting turned off," he says, "or if people are dropping accounts because they don't feel safe with their data."
Pringle says in the digital world, no company — not even Facebook — is "too big to fail."
Its predecessors such as Myspace, AOL and others all had comparable reach to Facebook in their day.
But they all met their demise slowly, as rivals ate away at their dominance. As Gottlieb put it, "They tend to fall off because their network becomes less monopolistic over time."
That could happen to Facebook, too, but Gottlieb isn't ready to count the company out just yet.
"They don't necessarily have a plan they know will work," he says, "[but] it's not the end of the world for Facebook."
A market meltdown like that inevitably left the company's investors wondering "What's next for Facebook?"
After all, it wasn't a set of ugly numbers that sent investors to the exit. The company still made gobs of money — more than $5 billion in profit, in fact. But the sell-off was sparked by fears that the endless growth may soon come to an end.
To Ramona Pringle, a CBC columnist and media professor at Ryerson University in Toronto, the company's main problem is the same one that has felled many of its technological ancestors — you're cool, until you're not. And to young people at least, the world's biggest social media company is decidedly not.
"Talk to anyone under 22," she says, "and they're not on Facebook."
Whatever young users the service does have, Pringle says, they basically just use it to "check in with their mom and share photos with their mom."
And the generation that follows is even less likely to sign up in droves, she says.
For a company that sold investors on its prospects based on endless growth, that's a problem.
Facebook use is still growing in Asia, Africa and the Middle East. But it's declining in Europe and basically flat in North America — by far the company's two most lucrative markets.
"At least when it comes to North America," Pringle says, "they kind of maxed out."
Scandal 'boomerang'
Which is part of the reason why investor Ophir Gottlieb says this week's sell-off makes sense.
The president and CEO of Capital Market Laboratories says Facebook got punished in part because of lingering fears from the Cambridge Analytica scandal, which revealed Facebook allowed an outside consulting firm to collect personal data on millions of users and sell it off to try to influence elections in the U.K. and the U.S.
"This is really where Facebook's lack of transparency during the data scandal and the election scandal is now going to boomerang and hit them," Gottlieb says.
Despite the eye-popping profit figure of $5.1 billion, Gottlieb rattles off a series of metrics that show why the stock plunge was at least partly justified based on the numbers alone.
The company increased its headcount by almost 50 per cent as it went on a hiring spree to make good on its post-scandal promises to protect data privacy. But by its own admission, its revenue growth is slowing to about 25 per cent a year, which has pushed the company's profit margin to about half of what it used to be.
"Add up slower user growth, slowing revenue growth, and expenses growing faster than revenue for several years out," Gottlieb says, "and that's a recipe for about a 20 per cent stock drop."
'Elephant in the room'
Those might be fixable, short-term problems, but the company is still left with what he calls "the elephant in the room" — people are just getting fed up with Facebook.
"We don't really know if the slowing user growth is because people are getting turned off," he says, "or if people are dropping accounts because they don't feel safe with their data."
Pringle says in the digital world, no company — not even Facebook — is "too big to fail."
Its predecessors such as Myspace, AOL and others all had comparable reach to Facebook in their day.
But they all met their demise slowly, as rivals ate away at their dominance. As Gottlieb put it, "They tend to fall off because their network becomes less monopolistic over time."
That could happen to Facebook, too, but Gottlieb isn't ready to count the company out just yet.
"They don't necessarily have a plan they know will work," he says, "[but] it's not the end of the world for Facebook."
About the Author
http://www.cbc.ca/news/politics/navy-mould-legal-1.4762818
Federal judge rejects sailor's lawsuit over warship mould
Retired sailor claims mould made him sick; he's planning an appeal
Comments
Commenting is now closed for this story.
David Amos
HMMM that was a mouthful for a political lawyer to say as he argues the Crown he has sworn an oath or two to in the past. In my humble opinion we all would have all been better served if the lawyer Brian Murphy had paid attention to the "lying and deceit" when he was Member of Parliament. His fellow liberals now oversee the Crown attorneys he is arguing yet he feels free to he describe the Crown's actions as "malicious.and devious" ? That is truly interesting indeed. Trust that all the liberals are well aware of the lawsuit I filed in Federal Court in 2015 when Harper was the PM. Perhaps all veterans should study paragraph 83 of my Statement of Claim against the Crown and ask questionable lawyers such as Murphy some serious questions ASAP.
Methinks anyone can Google the following and find my lawsuit on the Internet N'esy Pas?
David Amos Federal Court
http://www.cbc.ca/news/canada/toronto/lisa-macleod-asylum-border-1.4762549
Ontario formally requests $200M from Ottawa for asylum seeker costs
Federal approach to problem 'testing the patience and generosity of Ontarians,' minister says
Comments
Commenting is now closed for this story.
Elias Snodgrass
This could be the most expensive tweet JT ever sent out
@Elias Snodgrass "This could be the most expensive tweet JT ever sent out'
YUP
YUP
Jane Smith
$200 million could go a long
way in supporting Canadians, I think it's appalling to spend this kind
of taxpayer money on economic migrants.
James Fitzgibbon
@Jane Smith
Where did you get your information that they were "economic migrants" and not asylum seekers? An alt right conspiracy blog? Maybe you should read some more trustworthy sources and educate yourself. Start here, with the Globe: https://www.theglobeandmail.com/opinion/editorials/article-globe-editorial-conservative-accusation-of-a-border-crisis-doesnt/
Where did you get your information that they were "economic migrants" and not asylum seekers? An alt right conspiracy blog? Maybe you should read some more trustworthy sources and educate yourself. Start here, with the Globe: https://www.theglobeandmail.com/opinion/editorials/article-globe-editorial-conservative-accusation-of-a-border-crisis-doesnt/
David Amos
@James Fitzgibbon How many have you taken into your home?
Daryl McBride
Much like the Paul Martin Liberals, these Liberals seem to be passing costs onto the provinces as well.
James Fitzgibbon
@Tim Smith
So you are a denier of climate science then? How odd, given the overwhelming scientific evidence shows unequivocally that the planet is warming and we are the cause. And economists the world over favour a price on carbon vs gov't attempts to reduce emissions through regulation. Futhermore, carbon taxes clearly work: https://www.cbc.ca/news/canada/british-columbia/b-c-s-carbon-tax-a-real-life-rebuttal-to-carbon-pricing-s-political-opponents-some-experts-say-1.4758484
And yet, here you are denying all this is true. Maybe time for a bit of education on your part?
So you are a denier of climate science then? How odd, given the overwhelming scientific evidence shows unequivocally that the planet is warming and we are the cause. And economists the world over favour a price on carbon vs gov't attempts to reduce emissions through regulation. Futhermore, carbon taxes clearly work: https://www.cbc.ca/news/canada/british-columbia/b-c-s-carbon-tax-a-real-life-rebuttal-to-carbon-pricing-s-political-opponents-some-experts-say-1.4758484
And yet, here you are denying all this is true. Maybe time for a bit of education on your part?
David Amos
@James Fitzgibbon "Futhermore, carbon taxes clearly work"
Now thats funny
Now thats funny
William Pantia
I suggest everyone pay
attention and when 2019 comes, make your voices heard about the
direction of this country. Exactly what has this gov't accomplished? I
submit not much.
David Amos
@William Pantia "I submit not much."
True However methinks Harper 2.0 ain't gonna fix anything either N'esy Pas?
True However methinks Harper 2.0 ain't gonna fix anything either N'esy Pas?
Doug James
@Brian Williams
Would you open your own door to help people coming into Canada illegally? Do you volunteer at or donate funds to agencies that do? Canada cannot absorb the masses anymore than you can house, feed, and clothe the homeless. When you have given us your own good example to follow, come back and talk to us. Until then...
Would you open your own door to help people coming into Canada illegally? Do you volunteer at or donate funds to agencies that do? Canada cannot absorb the masses anymore than you can house, feed, and clothe the homeless. When you have given us your own good example to follow, come back and talk to us. Until then...
Kerry Thurston
He’s on vacation in B.C. this week so don’t expect a quick response.
Lester Rowe
@Kerry Thurston
Is he going back to Creston?
Is he going back to Creston?
David Amos
@Lester Rowe Methinks his handlers no doubt know the old rule
"Been there done that so don't go back." N'esy Pas?
"Been there done that so don't go back." N'esy Pas?
https://www.cbc.ca/news/business/facebook-stock-plunge-1.4762449
Facebook sees biggest stock market value drop in history as growth slows
Social media giant loses more than $100 billion in early trading after earnings and forecasts disappoint
Comments
Commenting is now closed for this story.
Commenting is now closed for this story.
Alice Barton
Facebook is nothing but an
inflated balloon waiting to burst. They produce nothing, service
nothing and only cater to a gossip hungry audience.
David Amos
@Alice Barton YUP
Sam Philip
Who really cares about fakebook?
David Amos
@Sam Philip Methinks you should if the CPP dudes or whomever is managing your other pension have invested in it N'esy Pas?
Ken MacDonald
Amazing that a company that produces no product and uses people's info to deliver ad-based content survived as long as it has.
David Amos
@Ken MacDonald I agree
Bill Edward Goate
I fine it hilarious when
Facebook starts talking about "Community Standards" as though we're all
on the same team or working towards a shared goal.
David Amos
@Bill Edward Goate Methinks
its rather comical to read such an opinion from somebody who obviously
doesn't obey CBC's rules for commenting here N'esy Pas?
Clarence Hemeon
Couldn't make me happier. What goes around comes around.
Troy Mann
@Clarence Hemeon
Many good honest people own stocks in Facebook and rely on them for retirement. Most likely if you own mutual funds you own a portion of Facebook.
Many good honest people own stocks in Facebook and rely on them for retirement. Most likely if you own mutual funds you own a portion of Facebook.
Jennifer McIsaac
@Troy Mann
I think you would be foolish to put a lot of money in tech stocks such as Facebook as they are so pricey and risky and hardly any better to buy mutual fund rather than a balanced group of ETFs - especially for retirement unless you are very young.
I think you would be foolish to put a lot of money in tech stocks such as Facebook as they are so pricey and risky and hardly any better to buy mutual fund rather than a balanced group of ETFs - especially for retirement unless you are very young.
David Amos
@Troy Mann Cry me a river
David Amos
@Jennifer McIsaac Methinks you don't know who Mr Mann works for N'esy Pas?
Troy Mann
@Jennifer McIsaac
Thanks for the advice, I will pass it onto my financial advisor for review. I personally didn't mention I had any shares in Facebook only mentioned many people do as it's been a good growth stock that has been solid for years. Compared to the $21 it was in 2012 and it being $174 now many people bought through out, many not as financial say as others.
Thanks for the advice, I will pass it onto my financial advisor for review. I personally didn't mention I had any shares in Facebook only mentioned many people do as it's been a good growth stock that has been solid for years. Compared to the $21 it was in 2012 and it being $174 now many people bought through out, many not as financial say as others.
Troy Mann
@David Amos
Why you so angry Dave?
Why you so angry Dave?
David Amos
@Troy Mann Methinks I should be called Mr Amos by a dude who is to afraid to come to the phone N'esy Pas?
David Amos
@Troy Mann "Why you so angry Dave?"
Go Figure
"Troy Mann - the Assistant Deputy Minister of the Pensions and Employee Benefits Division with the NB Department of Human Resources.As the day-to-day administrator, the Pensions and Employee Benefits Division has been responsible for implementing the recent pension reforms that have occurred with a number of public sector plans in New Brunswick"
Go Figure
"Troy Mann - the Assistant Deputy Minister of the Pensions and Employee Benefits Division with the NB Department of Human Resources.As the day-to-day administrator, the Pensions and Employee Benefits Division has been responsible for implementing the recent pension reforms that have occurred with a number of public sector plans in New Brunswick"
Jane Watson
So... Facebook is trying to
become more socially responsible rather than socially exploitative and
profits are slowing... and investors are leaving like rats off a sinking
ship.
Perhaps society should stop catering to rats.
Perhaps society should stop catering to rats.
Peter Hill
@Jane Watson
Their growth was only 11%
Their growth was only 11%
David Amos
@Peter Hill Go figure how
greedy people look at things. their money is invested in and how they
react to speculation. Methinks they make no sense most of the time N'esy
Pas?
Peter MacDonald
So, does Facebook produce
anything of value? Can you eat it, build with it, get clean water from
it, get health care or a good education, provide transportation to get
you to your appointments or vacation destination? No? An economic system
is supposed to provide goods and services. Facebook doesn't really
provide anything required by anyone. Not only do we have to live with
fake news, but now a fake economy.
Karen King
@Peter MacDonald
Huh it's called capitalism, only about half of the things produced are necessary, actually probably half of that. We only need food, shelter and clothing (basics) everything else is gravy.
Capitalism creates a need for stuff we don't need.
Huh it's called capitalism, only about half of the things produced are necessary, actually probably half of that. We only need food, shelter and clothing (basics) everything else is gravy.
Capitalism creates a need for stuff we don't need.
@Peter MacDonald
That's a very idealistic (and utlilitarian) view of the economy. What is the "value" of tobacco products? What is the "value" of alcohol? What is the "value" of sporting activities? Or the arts?
If someone is willing to pay money for something, it has value. That's the way markets work.
That's a very idealistic (and utlilitarian) view of the economy. What is the "value" of tobacco products? What is the "value" of alcohol? What is the "value" of sporting activities? Or the arts?
If someone is willing to pay money for something, it has value. That's the way markets work.
David Amos
@Bob Fuchs "What is the "value" of tobacco products?"
Methinks Indian folks use tobacco to make peace. Perhaps Yankees should make Trump learn to use a peace pipe sometime soon. That would help the economy N'esy Pas?
Methinks Indian folks use tobacco to make peace. Perhaps Yankees should make Trump learn to use a peace pipe sometime soon. That would help the economy N'esy Pas?
David Amos
@Karen King "Capitalism creates a need for stuff we don't need."
Methinks a lot of snobby beancounters give the wacko Adam Smith the credit for dreaming up Capitalism when he called us consumers N'esy Pas?
Methinks a lot of snobby beancounters give the wacko Adam Smith the credit for dreaming up Capitalism when he called us consumers N'esy Pas?
Paul Reed
The growth has slowed. Everything has a saturation point, and it would seem FB is approaching it.
No big surprise.
No big surprise.
David Amos
@Paul Reed I concur
Rob Smith
Note to all FB haters:
membership is free and completely voluntary. If you don't like any
aspect of it, don't join or cancel your membership if you're already in.
They are NOT a public utility and they don't owe you anything, unless
you're a shareholder.
Doyle Dykk
@Rob Smith
Facebook got tRump elected. That affects everybody, whether or not they join. So count me in with those who would like to see them crash.
Facebook got tRump elected. That affects everybody, whether or not they join. So count me in with those who would like to see them crash.
David Amos
@Doyle Dykk Methinks Obama
and Hillary and nearly every other Yankee and Canadian politician
benefited a lot from Facebook as well N'esy Pas?
Elias Snodgrass
Farcebook is way overvalued
David Amos
@Elias Snodgrass YUP
Federal judge rejects sailor's lawsuit over warship mould
Retired sailor claims mould made him sick; he's planning an appeal
A Federal Court judge has rejected a lawsuit against the federal government by a former sailor who claims his debilitating lung condition was the result of mould exposure aboard two Canadian warships.
Retired lieutenant Alan Doucette of Moncton, N.B. filed the claim last December. A judge recently tossed the case, saying the former officer already had received benefits from Veterans Affairs Canada.
His lawyer, Brian Murphy, said the decision will be appealed.
The National
Canadian sailor sickened from mould exposure
00:00
02:22
In an interview with CBC News, Doucette said he is not giving up.
"It has been well documented for many, many years that black mould is harmful to humans but, you know, they kinda turn a blind eye and try to cover it up as best as they could," he said.
"It is something they should be held accountable for, what they did, and what they continue to do in a lot of these ships."
The blatant disregard of contaminated ships and the lying and deceit … It's malicious. It's devious.- Lawyer Brian MurphyDoucette was medically released in 2012 and granted benefits when Veterans Affairs acknowledged his exposure to "volatile organic compounds," including mould, resulted in his ongoing breathing difficulty and health problems.
An internal National Defence report, released to CBC News last spring, blamed the build-up of potentially hazardous mould aboard the frigates on a lack of upkeep by the navy.
The engineering analysis — which was obtained under access to information law after a battle of almost two years — said shipboard heating and air conditioning structures (HVAC) and their associated controls were allowed to deteriorate over the years, to the point where they became almost useless.
CBC News first reported on the spread of mould aboard warships, and attempts to counter it, in the summer of 2016.
Veterans Affairs recognized Doucette's hyperactive airway disorder was brought on by exposure during his service to toxic substances, including mould and possibly including diesel fumes.
In his ruling, the federal judge said the former sailor was covered by existing legislation and had been compensated.
But Murphy said his client's case is different.
When soldiers sign on for the so-called 'unlimited liability' — laying down their lives for their country — it doesn't include systemic negligence, he said.
"Going to war and being killed in action is something that is expected. If you fall down on a ship, that is expected," he said.
"But the blatant disregard of contaminated ships and the lying and deceit … it's different. It's malicious. It's devious."
The National
Navy battles mould in frigate ventilation systems
00:00
02:07
It also has started a series of engineering fixes on each of the frigates to address high humidity levels and inadequate ventilation. Part of the plan is a program to swap out the thermostats on each of the warships.
High humidity and poor air flow have been blamed for the mould buildup.
The military's environmental services section has conducted preventative health inspections and issued mould cleaning guidelines for the frigates.
About the Author
Ontario formally requests $200M from Ottawa for asylum seeker costs
Federal approach to problem 'testing the patience and generosity of Ontarians,' minister says
Ontario's new Progressive Conservative
government has formally requested $200 million from Ottawa to cover the
costs of dealing with asylum seekers crossing into the province from the
United States.
In a letter to her federal counterpart, Minister of Children, Community and Social Services Lisa MacLeod said that "Ontario can only do so much" and expressed concern over Ottawa's "approach to the issue of illegal border crossing.
"For more than a year, communities across Ontario have been straining to support a high number of the illegal border crossers, and the approach of the federal government is now testing the patience and generosity of Ontarians," she said.
While
the PCs previously signalled that they would demand increased federal
funding, Thursday's letter laid out clearly how the province arrived at
the $200 million figure.
According to MacLeod, the money will cover:
Calling the issue of asylum seekers a "crisis," the newly elected PC government in Ontario has been critical of the federal government's policies.
So far, Ottawa has offered up $50 million to provinces coping with the influx. That sum includes $36 million for Quebec, $3 million for Manitoba and $11 million for Ontario — but Ontario's money was funnelled directly to Toronto.
Today, Immigration, Refugees and Citizenship Canada briefed reporters in Toronto on the border situation, offering assurances that the federal government has a handle on it.
"We are operationally ready for any possible scenarios," a senior official said. "We have a robust awareness of the situation at the border across the country, and we are able to respond to influxes when they occur."
The federal government will provide hotel rooms for 540 migrants, including those who are now lodged in college dorms and have to leave to make room for students. As of Oct. 1, Toronto will be responsible for housing the refugee claimants.
The officials stressed that the number of asylum seekers crossing the border fluctuates over months and years and is affected by many global factors beyond government control, such as conflict and natural disasters.
As for the $200 million ask from the Ontario government, the official could only say that the figure has not yet been verified or discussed.
At a meeting of the country's premiers earlier this month, Ontario Premier Doug Ford, Quebec Premier Philippe Couillard and Manitoba Premier Brian Pallister announced that they would continue to press for the federal government to boost financial support for the provinces.
Federal Immigration Minister Ahmed Hussen has been critical of the Ford government's rhetoric around asylum seekers crossing into Ontario and Quebec from New York. That tension frequently has played out on a public stage, with MacLeod and Hussen taking occasional shots at one another in the media.
Hussen has said that he is willing to hear Ontario's concerns and call for more funding, but that the federal government had not yet received a formal request.
Hussen's spokesman Mathieu Genest said the government is managing the increased movement of asylum seekers in a "responsible and measured way" and that it stands ready to work with the Ontario government.
"Abiding by Canadian laws to keep Canadians safe and respect our international obligations is not optional, it is a requirement," he said in an email. "It is disappointing that the Ontario government has decided to view this as a choice, and is playing politics on this issue by spreading disinformation about a vulnerable group of people.
"With Ontario's decision to not participate in discussions surrounding asylum seekers, we are engaging directly with municipalities in order to implement our plan."
At a committee hearing on Parliament Hill earlier this week, several federal ministers defended Ottawa's handling of asylum seekers.
Public Safety Minister Ralph Goodale said the federal government has made it clear that simply entering Canada is not a "free ticket'' for newcomers to stay in the country.
But no matter how a person arrives in Canada, the individual must be given a fair hearing to determine whether they require protection, Goodale said during the committee meeting.
The most recent figures suggest that the number of crossings has declined recently.
Statistics from Immigration, Refugees and Citizenship Canada show the RCMP intercepted 10,744 people at irregular border crossings between January and the end of June this year. Last month there were 1,263 irregular border-crossers, down from 1,869 in May 2018.
In a letter to her federal counterpart, Minister of Children, Community and Social Services Lisa MacLeod said that "Ontario can only do so much" and expressed concern over Ottawa's "approach to the issue of illegal border crossing.
"For more than a year, communities across Ontario have been straining to support a high number of the illegal border crossers, and the approach of the federal government is now testing the patience and generosity of Ontarians," she said.
According to MacLeod, the money will cover:
- $74 million for temporary housing costs in Toronto alone, as well as $12 million for Ottawa and $3 million for the Red Cross for support services.
- $90 million in social assistance costs.
- $20 million for "primary and secondary education spaces."
Calling the issue of asylum seekers a "crisis," the newly elected PC government in Ontario has been critical of the federal government's policies.
So far, Ottawa has offered up $50 million to provinces coping with the influx. That sum includes $36 million for Quebec, $3 million for Manitoba and $11 million for Ontario — but Ontario's money was funnelled directly to Toronto.
Toronto responsible for shelter as of Oct. 1
Today, Immigration, Refugees and Citizenship Canada briefed reporters in Toronto on the border situation, offering assurances that the federal government has a handle on it.
"We are operationally ready for any possible scenarios," a senior official said. "We have a robust awareness of the situation at the border across the country, and we are able to respond to influxes when they occur."
The federal government will provide hotel rooms for 540 migrants, including those who are now lodged in college dorms and have to leave to make room for students. As of Oct. 1, Toronto will be responsible for housing the refugee claimants.
The officials stressed that the number of asylum seekers crossing the border fluctuates over months and years and is affected by many global factors beyond government control, such as conflict and natural disasters.
As for the $200 million ask from the Ontario government, the official could only say that the figure has not yet been verified or discussed.
At a meeting of the country's premiers earlier this month, Ontario Premier Doug Ford, Quebec Premier Philippe Couillard and Manitoba Premier Brian Pallister announced that they would continue to press for the federal government to boost financial support for the provinces.
Federal Immigration Minister Ahmed Hussen has been critical of the Ford government's rhetoric around asylum seekers crossing into Ontario and Quebec from New York. That tension frequently has played out on a public stage, with MacLeod and Hussen taking occasional shots at one another in the media.
Hussen has said that he is willing to hear Ontario's concerns and call for more funding, but that the federal government had not yet received a formal request.
Hussen's spokesman Mathieu Genest said the government is managing the increased movement of asylum seekers in a "responsible and measured way" and that it stands ready to work with the Ontario government.
"Abiding by Canadian laws to keep Canadians safe and respect our international obligations is not optional, it is a requirement," he said in an email. "It is disappointing that the Ontario government has decided to view this as a choice, and is playing politics on this issue by spreading disinformation about a vulnerable group of people.
"With Ontario's decision to not participate in discussions surrounding asylum seekers, we are engaging directly with municipalities in order to implement our plan."
At a committee hearing on Parliament Hill earlier this week, several federal ministers defended Ottawa's handling of asylum seekers.
Public Safety Minister Ralph Goodale said the federal government has made it clear that simply entering Canada is not a "free ticket'' for newcomers to stay in the country.
But no matter how a person arrives in Canada, the individual must be given a fair hearing to determine whether they require protection, Goodale said during the committee meeting.
The most recent figures suggest that the number of crossings has declined recently.
Statistics from Immigration, Refugees and Citizenship Canada show the RCMP intercepted 10,744 people at irregular border crossings between January and the end of June this year. Last month there were 1,263 irregular border-crossers, down from 1,869 in May 2018.
With files from The Canadian Press
Facebook sees biggest stock market value drop in history as growth slows
Social media giant loses more than $100 billion in early trading after earnings and forecasts disappoint
Facebook lost more than $100 billion US
in market value Thursday after the social media company posted earnings
a day earlier that showed slowing growth.
The value was down by even more overnight after the company posted quarterly results late Wednesday showing its growth was grinding to a halt in Europe and North America, at a time when increased privacy safeguards would raise its cost of business.
The company closed at $217.50 a share on the Nasdaq on Wednesday, but that was before earnings came out. Then came the plunge in after-hours trading, after the company revealed it had 2.23 billion monthly users in its last quarter, up 11 per cent from last year's level, but well short of what industry analysts had been expecting.
In North America, the daily user number was flat at 185 million, and in Europe it actually declined by three million people a day. All of this was enough to spook investors in the shares on the Nasdaq when the market opened on Thursday morning. Shares were trading at $175.75, down about 19 per cent, nearing midday.
The previous one-day record was held by Intel, which lost $91 billion during the dot-com bust in September 2000.
At least 16 brokerages cut their price targets for the company after the company posted its results.
"With stagnating core user growth, we think there is too much near- to mid-term uncertainty to recommend shares at this point," Japanese investment bank Nomura said.
Before the earnings report, the bank had forecast Facebook shares would soon be worth $228 each. On Thursday, they downgraded that figure to $183, only slightly higher than where they are now.
Others are even more pessimistic. "Our view is that the company is far from out of the woods," Brian Wieser of Pivotal Research said. He was one of the few analysts to have a "sell" rating on the company even before Wednesday.
Specifically, Wieser says new European rules about company obligations to protect consumer privacy known as GDPR may prove to be expensive for the company in the long run.
"The bundling of consent for Facebook to use consumer data with access to the platform appears to be an aggressive interpretation of GDPR, and one that might be more subject to eventual regulatory action," Wieser said.
"While those actions might take time to play out, it is still possible that threatened fines associated with GDPR to Facebook or other sellers of advertising could also have the effect of spooking advertisers into changing how they use data," said Wieser, who thinks the shares should be worth $140 US — well below Thursday's level.
The value was down by even more overnight after the company posted quarterly results late Wednesday showing its growth was grinding to a halt in Europe and North America, at a time when increased privacy safeguards would raise its cost of business.
The company closed at $217.50 a share on the Nasdaq on Wednesday, but that was before earnings came out. Then came the plunge in after-hours trading, after the company revealed it had 2.23 billion monthly users in its last quarter, up 11 per cent from last year's level, but well short of what industry analysts had been expecting.
In North America, the daily user number was flat at 185 million, and in Europe it actually declined by three million people a day. All of this was enough to spook investors in the shares on the Nasdaq when the market opened on Thursday morning. Shares were trading at $175.75, down about 19 per cent, nearing midday.
At least 16 brokerages cut their price targets for the company after the company posted its results.
"With stagnating core user growth, we think there is too much near- to mid-term uncertainty to recommend shares at this point," Japanese investment bank Nomura said.
Before the earnings report, the bank had forecast Facebook shares would soon be worth $228 each. On Thursday, they downgraded that figure to $183, only slightly higher than where they are now.
Others are even more pessimistic. "Our view is that the company is far from out of the woods," Brian Wieser of Pivotal Research said. He was one of the few analysts to have a "sell" rating on the company even before Wednesday.
Specifically, Wieser says new European rules about company obligations to protect consumer privacy known as GDPR may prove to be expensive for the company in the long run.
"The bundling of consent for Facebook to use consumer data with access to the platform appears to be an aggressive interpretation of GDPR, and one that might be more subject to eventual regulatory action," Wieser said.
"While those actions might take time to play out, it is still possible that threatened fines associated with GDPR to Facebook or other sellers of advertising could also have the effect of spooking advertisers into changing how they use data," said Wieser, who thinks the shares should be worth $140 US — well below Thursday's level.
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