Another day, another dollar lost in Facebook (FB), and after Tuesday's close it's beginning to get a little ridiculous. But it isn't getting cheap -- not yet.

On Tuesday, Facebook was upgraded by Sanford Bernstein, and for a brief moment -- ever so brief -- it looked like the stock was going to hold.

But then, once again, it fell apart, closing Wednesday at $20.88. That's a new low for a stock that's looking more like Groupon (GRPN), almost back to its low, and Zynga (ZNGA), hitting a new low. It's looking less like LinkedIn (LNKD), which is set to report Thursday and has actually distinguished itself as an overvalued winner rather than an overvalued loser.

What's really ailing Facebook? Is it the millions upon millions of shares that insiders will be able to sell when a key lock-up expires this month? Is it that the conference call was one of the most disjointed I can recall?

No, what's destroying Facebook is its valuation, the fact that it started so high that this continual decline almost seemed inevitable, given the slowing growth rate and the shrinking multiple on the small earnings it has.

The stock's got fundamental worth, because it can make money and has almost 1 billion users. But it is still valued at $50 billion, a hefty sum, given its lack of visibility and the challenge of mobile, a challenge for which we now know it wasn't ready and which it still can't seem to get its arms around.

For all the acknowledged genius of the people behind the company, it is obvious now that they didn't see the acceleration to mobile and they don't have a plan for it. They aren't Zynga, which is imploding, but they sure as heck aren't eBay (EBAY), which is praying for a full-scale mobile revolution.

You know what's most ironic about Facebook? Other than General Motors (GM), I have neither seen nor heard of a company that says Facebook is anything other than the best way to reach out to new customers. Further, now the guy who booted Facebook from the GM advertising campaign has been booted himself. His anti-Facebook cockiness endeared him to no one but the shorts.

Pepsico (PEP) said Tuesday that Facebook is a terrific way to interact with consumers. Buffalo Wild Wings (BWLD) and Domino's (DPZ) say the same thing. The numbers from Electronic Arts (EA), out late Tuesday night, show an impressive uptake for Battlefield 3, which was mentioned on the Facebook conference call as a successful campaign.

Yet somehow, with all of this good press, and with all of these companies allegedly loving Facebook, it doesn't seem to translate into positive earnings momentum.

How will Facebook bottom? I think it will do so like a lot of other stocks in free fall: You need downgrades, estimate cuts, an end of the affection and insiders declining to sell because the stock's too low. In fact, insider buys could play a significant role in stemming the decline, particularly if they are executed by the same folks we think will sell the soon-to-be-unlocked shares.

That's the bottoming process of any fallen angel, including the few surviving Internet stars of yesteryear.

Otherwise, the only thing that I think will keep Facebook from falling more Wednesday is, alas, the closing bell.

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and is long EBAY.

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