that bubble is going to pop
Today in class we spoke about the internet bubble of the late 90s and early 00s. When the bubble popped (as bubbles typically do) it caused the markets to lose a trillion dollars.
Strangelove talked about how the internet bubble caused the markets to collapse. He explained that the crash was caused by the investors foreseeing or betting that the internet was going to replace in store shopping. Retail shops and things of that nature were said to be doomed. However what the investors failed to account for (apparently) was that everything on the internet needs to be delivered or shipped to the consumer. Gas is expensive and gas runs the trucks and planes that deliver said product. The reason that “bricks didn’t turn to clicks” as mentioned in lecture is that it just was not economically feasible for things like groceries to be delivered to every household every week. Plus to add to that, people like to shop. I for one enjoy hanging out in shopping malls and walking around stores when there is nothing else to do. People enjoy spending time out of their houses with other people.
I enjoy the stock market and learning about the mistakes of investors in the past. I did some research on the dot-com bubble and what really caused it to collapse. Through this research, and I use the term ‘research loosely’ I found that according to Wikipedia (don’t hate, it’s a blog) there were a number of companies all competing with the same plan to monopolize their sector. Meaning that everyone was competing for complete control of their given business sector on the internet. Basically Sony, Panasonic and several other corporations were planing on becoming the only internet source for products such as headphones and televisions. Unfortunately when everyone is planning to be the sole owner of an industry, especially a new industry, two things are needed. 1) money, lots and lots of money and 2) space, your company need to be the ONLY company in said sector. Unfortunately for those investing in the internet in the late 90s no corporation had both those things at the same time. Space was, from my perspective, probably the most difficult of the two things to acquire. Big corporations practically print money, especially during a bubble, and therefore I feel as though the constant competition is more or less what destroyed the dot-com bubble, greed is a bitch.
So that hopefully works for today, this makes the fifth blog I’ve written so far this year. I should probably get my shit together soon, I have notes written on what I plan on blogging about, its not just a matter of actually writing them.