What Was The Dot Com Bubble?

The Dot-com bubble was a stock market crash that cleared 5 trillion dollars of market in the technology sector roughly from 95 to 2001. The up cause of this bubble was the birth of new Internet sites and Technical Industries. Many of these firms either went bankrupt or had to pay heavy consequences when the bubble burst. As lots of investor’s lost big amounts in this time this also provoked a soft recession in early 2000. In fact many Analysts saw that some of the companies didn’t look soothed after the burst even when the Web 2.0 enlightened a new set of investment and speculation near 2004.

Many factors carried on to blow the bubble, amongst them the common one was the period between 1995 of investment and speculation in the Internet firms. 1995 also saw a mega increase in Internet users whom the companies saw as their potential customers. This is also the reason why in the late 90”s so many new Internet sites came in the view. It’s these companies that got to be known as the “Dot-Com” and used the prefix “.com” at the end of their addresses.

During the bubble era many companies dared many, many business practices. The American Stock Exchange also went sky high during the bubble as hundreds of firms especially in the Silicon Valley near San Francisco were being born by the weekend. As these companies organized events with a lot of glamour expensive food and celebrities, people often associated the dot-com bubble with lavish lifestyle. Matter of fact the expense of these so called Events or Meetings used to go in hundreds of thousands of dollars.

As grand as it looked, this illusion broke as a cyclone for many of the tech-industries and investors. This illusionary brake also triggered a high level of court cases by the US government that targeted those tech firms that included borderline monopoly with unscrupulous business practice hence becoming the reason behind the stock market tumbling down. A decline in business expense in combination with market correction to deal the financial blow to the dot-comes and tech industries, one by one the firms started to close.

Most of these companies enacted in very daring and abnormal business practices in hope to dominate the market. In fact most of these firms took policy of growth over profit with the belief of doing so they are building their foundation of customers that will eventually increase their profits. Many dot-comes in order to dominate the market also tried cornering the customers of a particular domination.

Apart from the investment and speculation being one of the common factors of the dot-com bubble, outside factors like the rise of outsourcing was one of the issues that led to unemployment in the computer developers and the programmers department. Another mega downfall occurred during the terrorist attack on the United States in 2001 and the firms that dealt in irregular or questionable bookkeeping were eventually caught with sweaty hands in a series of government investigations. All this also caused the loss of faith by customers in the tech industry hence lowering profits tremendously.

Though overtime the matter has gone down the carpet but with the rise in developed nations of broadband a few years after the fall of the dot-com bubble, the rise has been an issue of concern for some financial analysts who seem to recognize a particular pattern again forming. The growing demand if high speed users has led to a new proliferation of dot-comes in particular are the social networking sites that has gotten many investors fearing the tech industry might see another Bubble 2.0 .

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