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From what I understand, bubbles bursting in the past (e.g. Tulips, Dotcom) have been triggered by a specific event rather than a new, more exciting outlet for m
by tomgallard 14y ago
From what I understand, bubbles bursting in the past (e.g. Tulips, Dotcom) have been triggered by a specific event rather than a new, more exciting outlet for money.
In the Tulip bubble it was a failed auction in Haarlan, in the DotCom bubble it was the Fed raising interest rates, paired with the judgement in the US vs Microsoft trial.
So, its interesting to hypothesize what the 'trigger' event could be in this case. I doubt it will be the Facebook float, as I think we have a while to run yet.
- benwerd 14y agoRight - I think my first bullet is probably triggered by an event. Facebook could be it, but I think you're right: it'll probably be something further down the line. Wouldn't surprise me at all if it turned out to be SOPA-like legislation coupled with a ruling on sales tax.
- _delirium 14y agoIt's hard to predict these things, but if I had to guess a trigger, it would be some kind of major negative news about internet advertising that causes at least a temporary stampede of advertising spend out of the sector (which could in turn trigger an even bigger investor reaction/overreaction). Not sure what precise form that'd take. Anything from a major click-fraud-type scandal (would have to turn out to be significantly worse than the current assumptions about fraud, though) to a damning report about ROI from one of the more credible white-paper-issuing analysts, or one of the players themselves.