November 30, 2014

Tech bubble bursting

Katie Benner on the tech bubble bursting:

I’ve watched two crashes now – the end of the dotcom boom in 2000 and the credit collapse of 2008 – and one thing that was true of both is that a chorus of observers and analysts and Smart Money spent years saying that the tech sector was overinflated before anything actually burst.

Sure, but the elephant in the room is that tech companies are making money this time around. It’s not all smoke and mirrors, there’s actual revenue, success stories, and sensible products within the tech bubble. It’s not even remotely the same, comparing dotcom with today’s tech scene is like comparing the first car with a spaceship. That said, it’s hard to deny the inflated valuations, and there’s always cycles. Neither of those two things mean that the tech bubble is about to burst anytime soon.

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