Google, the fallen Wall Street darling

Google has lost its panache and possibly, some think, its magic touch. Google Share prices closed at $464.19, down 4.57 percent and dangerously close to its 52-week low.

A report by investment firm UBS stating that Google paid clicks had fell down in January on Tuesday morning was the apparent cause of the sudden tanking, especially as it could be interpretated as a sure sign of an economy in recession.

UBS revealed that data compiled by Comscore showed that Google's sponsored clicks were down 7 percent month-on-month, flat year-on-year and down 12 percent quarter-wise; a major cause of concern for Google who gets most of its revenues from click adverts.

Research firm Hitwise registered a small but significant one percent increase in the amount of traffic originating from Google and going to shopping and classified websites at least in the US, an indication that people are indeed visiting retail websites in greater numbers or more often. That does not mean that each visit converted into a sale though.

Inside Chatter was quick to react in the opposite direction though saying that Google is overrated and due for a bigger fall.

There has also been a heated debate surrounding the percentage of click fraud and serial clickers where competitors click on each others' banners to increase marketing bills and steps taken by Google to mitigate this problem could actually be the cause of this decrease in click rates.

A commentator on Paidcontent.org understands though that there's has always been a natural dip after December and large Q4 ad expenditures; he also points out to huge cuts made in the mortgage/banking market after the sub-prime debacle in the US.