The “Dot-Com Bubble”: A Mislabeled Sobriquet or Malfeasance?

The Misconduct of Alan Greenspan and the Federal Reserve📉

The term “internet bubble,” aka the “dot-com bubble,” now 23 years later, seems to me a mislabeled deception. Why does “dot-com bubble” still circulate despite the massive growth in tech stock prices since then?

Let’s look at the facts for three major tech companies from January 1, 2000, to September 7, 2023 (stock split adjusted):

Apple (AAPL): $0.23 → $190.00 = 826X ROI 🚀

Microsoft (MSFT): $13.48 → $334.00 = 25X ROI

Amazon (AMZN): $0.78 → $138.00 = 184X ROI

Was there really a bubble? If you knew in 1995–2000 that these stocks would yield 25–826X returns by 2023, how many shares would you have bought? Investors back then saw the potential—tech stocks were reasonably priced with massive growth due to their solutions for global communication and commerce. The “dot-com bubble” was arguably the most undervalued time to invest in modern history. 💡

Digital Island, the backbone of the global web with world-renowned customers, suffered catastrophic devaluation under the false “dot-com” label. Unlike customerless online shops, we were different. The NASDAQ melt, with no 6% trading halt (as exists now), spiraled into a computer-driven sell-off.

Enter Alan Greenspan, Federal Reserve Chairman. In 1999, with inflation at 2.2% (the Fed’s target), he raised the federal funds rate to 7%, citing “too much wealth generation.” This 5% hike in March 2000 triggered the market collapse, hammering internet stocks.

Compare:

1999: Inflation 2.2%, Fed rate 7%, unemployment 4%, GDP 4.5%

2023: Inflation 8.8%, Fed rate 5.25%, unemployment 4%, GDP 2.1%

Greenspan’s rate hike, despite stable inflation, crushed working-class income growth. His successor, Ben Bernanke, slashed rates to 0% over eight years to recover, but the damage was done—20 years to revive the global economy. 😞

The numbers speak: $1M invested in 2000 in Apple, Microsoft, and Amazon would be worth $1.025B by 2023—a 341X return! The “dot-com bubble” wasn’t over-exuberance; it was government overreach stifling tech’s momentum.

It’s time to call it what it was: The Greatest Investment Opportunity in History.