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I have heard alot of references on TV and other places recently mentioning a "Dot com bust". What exactly was it and when did it happen? Im certain it referrs to internet companies going out of business but by the sounds of it, it seemed like something very big and that it happened quite fast. However, I have never found out much of the actual details behind it.

That's pretty much it. Lots of money flying around, easy to get ahold of it, and more investment than the market could allow for. Just the bubble bursting.

Basically it was a buncha website companies going kaput all at the same time because they all learned the Hard Way that the Internet is not a good source of revenue. You can thank idiots massively overhyping the Net in the mid-90s for that crap.

Icehawk wrote:I have heard alot of references on TV and other places recently mentioning a "Dot com bust". What exactly was it and when did it happen? Im certain it referrs to internet companies going out of business but by the sounds of it, it seemed like something very big and that it happened quite fast. However, I have never found out much of the actual details behind it.

Everything in Silicon Valley and the Bay Area went into over drive during the years from say 97-01. Housing prices doubled, they tripled in some areas. During the peak in 99/00 there was a 6 month waiting list for apts in Fremont.
Jobs were plentiful, although most didnt pay much contrary to what people say.
Stock prices where skyrocketing and people where purchasing homes based on projected stock prices, or for the lucky few on real gains through stock options.
All of that started to come apart late 2000 and the bubble burst.

Some things about the burst are good, I no longer have to wait 30 minutes in line to get a fucking Jamba Juice only to have the person get my order wrong. Traffic is half as bad as it used to be. Rentals are easy to find. Housing prices are still rising but not 10-20K a month.

The bad is there are no jobs to be found. Pay for the jobs that are being created is coming down. The state's budget is trashed. And so on.

A good example of the bubble was when Qualcomm's stock was at ~$750.00 a share, and 15 million shares were traded in two days.

Drewcifer wrote:A good example of the bubble was when Qualcomm's stock was at ~$750.00 a share, and 15 million shares were traded in two days.

Ive been thinking about the "cliche" that old people hide money in tin cans because they lived through the Great Depression and dont trust banks. I actually know a Chinese Grandma that does this cause of some bank collapse in China. Anyway, Ive been thinking that Im probably going to live the rest of my life not trusting emergency money to be in stocks. My next financial goal after getting a good job, will be to put 6-12 months emergency cash money in the bank. I think I will feel the need for that much savings for the rest of my life.

Your basic speculative bubble. Over hyping with no short term expected revenue and high costs. Ultimately it just went out.

I'm glad I pulled out before that happened though.

Yes, yes, emergency money should be liquid, as in cash in the bank. The stock market is best for long term investment. In fact, it's easy to make money in the stock market, as long as your outlook is in the 20+ year range.

Concerning the DotCom bubble, Dot.con : How America Lost Its Mind and Money in the Internet Era by John Cassidy is a good book that covers the whys and whats of the DotCom bubble. It's available at Amazon and probably your local library.

neoolong wrote:I'm glad I pulled out before that happened though.

A lot of men wish they were so lucky.

But holy shit 750 a share? I wish i had bought stock back in the early 90s. id be fucking rich.. 1000 dollars worth would make me about 40k bout then..

kojikun wrote:

neoolong wrote:I'm glad I pulled out before that happened though.

A lot of men wish they were so lucky.

But holy shit 750 a share? I wish i had bought stock back in the early 90s. id be fucking rich.. 1000 dollars worth would make me about 40k bout then..

That is if you could hold that long. Most people would sell when they've doubled or trippled their money. It takes brass cahones to ride the wave to the top.

It's funny in a way. I wondered why nobody else was able to forsee that it would happen. Hell I was still in high school and I told my dad to pull out because even looking at the companies from the start of the boom, they were already going into the crapper.

TrailerParkJawa wrote:

kojikun wrote:

neoolong wrote:I'm glad I pulled out before that happened though.

A lot of men wish they were so lucky.

But holy shit 750 a share? I wish i had bought stock back in the early 90s. id be fucking rich.. 1000 dollars worth would make me about 40k bout then..

That is if you could hold that long. Most people would sell when they've doubled or trippled their money. It takes brass cahones to ride the wave to the top.

Too much risk of failure for me. It's like gambling. Bug out while you're stilll ahead.