The SEC's Regulation FD allowed bigger investors to get a closer look at Facebook's earnings.
The SEC's Regulation FD allowed bigger investors to get a closer look at Facebook's earnings. - 
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It's a common literary trope that there are only seven stories in the universe -- that every story you ever hear is a variation of those seven. Well I think we have an eighth story these days and it's pretty much anything to do with Facebook. Insert sound of agonized hair-pulling. No, we just can't seem to look away. So this week we learned that Facebook's share flop affected a bunch of other companies hoping to sell shares to the public.

And you may remember the recent news that some people had inside information prior to the IPO that average investors didn't -- and apparently that's legal. There's something called Regulation FD, an exception from the Securities and Exchange Commission that allows companies to selectively disclose information during the time they're pitching their stock offerings to investors.

"This business with Facebook just proves that the IPO process is really a big boy's game here," reporter Bob Moon told host Tess Vigeland. "The good ol' boys are able to negotiate all sorts of special deals, and the small investor -- if he or she gets a look will get the short-end of the stick. So the advice -- it's not just from me -- is very simple: Don't try to play that game. As an individual, you're just not going to be able to win."

There were some high hopes that the Facebook IPO will bring the average investor back to Wall Street, but those hopes came crashing down. Many Silicon Valley start-ups have tabled their IPOs after watching the launch of the Facebook IPO.

Take a listen to the interview above to learn more about loopholes and how you, the average investor, can protect yourself.