Abstract
The early years of the internet saw the swelling and bursting of a financial bubble in the information technology industry. This is generally considered to have taken place during 1996-2000, though there is some disagreement. This 'Dot-com Bubble' has had long-lasting impacts on the US economy.
Introduction
It seems odd to think that just a couple of decades ago, the internet was a novelty. A new and exciting sector of the global economy that promised much. It soon became clear that however much the internet and the emergent information technology sector could achieve was outpaced by what industry leaders, investors and financial analysts believed was realistic. This climate of "irrational exuberance" led to what we now call the Dot-com
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The novelty of the internet and the promise of a brighter future that you could not only be a part of, but profit from if you picked the right, bright new company to throw money at fooled many into losing their savings in stocks whose values plummeted, taking jobs and entire companies with them.
Regardless of when exactly it started, Greenspan's identification of a climate of "irrational exuberance" was astute. However, Galbraith and Hale suggest that however far-sighted those in certain federal positions may have been in the run-up to the crisis, the US government did far too little to prepare for it. Government policies may in fact have worsened the situation
There is the temptation to look back on the optimism of the early years of the internet and laugh. We are, after all, the products of the internet generation and surely we would never allow such wild speculation to inflate dot-com asset prices. This is a dangerous belief because the potentially unrealistic hopes for new technologies are still alive and well. Witness Facebook's acquisition of WhatsApp for a reported $345 per employee: a repeat of history is likelier than we would prefer to believe (Heskett,