Close Menu
    Facebook X (Twitter) Instagram
    Speeli
    • Facts
    • Geography
    • Health
    • History
    • Nature
    • Psychology
    • Science
    • Wiki
    Facebook
    Speeli
    Home - Websites - Why the 2000 dot com crash happened?

    Why the 2000 dot com crash happened?

    By Alex WilliamsJanuary 31, 2024
    Knowledge
    1. People were overly optimistic about Tech companies

      People were overly optimistic about the future of Tech companies that they sent their prices very high without much rational reasoning,

    2. Many Tech companies started reporting losses

      Many of the companies people had high hopes for started reporting losses. This led to massive selling. (See How to identify a stock market bottom?)

    3. Prices of Tech companies were inflated

      According to Investopedia In the year 1999, there were 457 IPOs, most of which were internet and technology related. Of those 457 IPOs, 117 doubled in price on the first day of trading.

    4. Investors went after big ideas not business plans

      Investors rushed into stocks that promised big changes to the industry without taking a look at their business plans. This made most of the tech stocks overvalued.

    5. Profitable companies were overvalued

      During the Tech bubble there were some profitable companies that had real business plans but most of them were overvalued due to the craze that was taking place.

    6. The use of metrics that aren’t related to cash flow

      Many investors started looking for certain metrics ,that had nothing to do with cash flow, to measure a business performance. (See How To Spot Unmet Market Needs?)

    7. Bad accounting practices

      Many companies started cooking the books and reporting incorrect numbers in in their financial statements. This made investors pour more money in those companies.

    8. Many new investors jumped in

      Because internet trading was relatively new. Many new and inexperienced investors jumped in the market. This led to much higher valuations for companies.

    9. Many companies preferred growth over profits

      Many Tech companies cared about growing instead of making profits. Those practices led those companies to bad financial situations.

    10. Internet businesses were a relatively new idea

      Because internet businesses were a relatively new idea investors couldn’t really find a fair value for them. This led to speculation about the future of those businesses.

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    alex1
    Alex Williams

    Alex Williams is a PhD student in urban studies and planning. He is broadly interested in the historical geographies of capital, the geopolitical economy of urbanization, environmental and imperial history, critical urban theory, and spatial dialectics.

    Related Posts

    JAN23 What are GPS Antenna Types 2

    What are GPS Antenna Types?

    January 31, 2024
    JAN23 Can you see Titanic on Google Earth 6

    Can you see Titanic on Google Earth?

    January 31, 2024
    Can You see the Great Garbage Patch on Google Earth

    Can You see the Great Garbage Patch on Google Earth?

    January 31, 2024
    Leave A Reply Cancel Reply

    About

    Welcome to Speeli – your reliable, lightning-fast source of knowledge on the internet.
    Speeli stands for Speedy lists.

    Speeli’s mission is to summarize the internet’s knowledge into Speeli summaries. By doing so we will make the process of finding information extremely fast.

    What Caused Ed and Lorraine Warren’s Death? Controversies and Legacy

    Where is Dominic Coia Now? Brutal Murder of Jason Sweeney

    Where is Sara Ganzer Mistress of Rick Dabate Now?

    Adulterers Ending Explained: Did Sam Murder Ashley and Damien?

    Mindcage Ending, Explained: Who Was the Copycat Killer?

    Let Him Go Ending, Explained: What happened to George?

    The Secret: Dare to Dream Ending, Explained: Did Bray and Miranda End Up Together?

    The Ritual Killer Ending Explained: Why Did Boyd Eat Randoku’s Eyes?

    Dangerous Game: The Legacy Murders Ending Explained

    The Tutor Ending Explained: Will There Be A Sequel?

    ‘Who Invited Them’ Ending Explained: Did Adam Die?

    Into the Deep Ending Explained: Did Jess Survive?

    • About us
    • DMCA
    • Privacy Policy
    • Terms of Service
    • What is Speeli?
    © 2025 Speeli

    Type above and press Enter to search. Press Esc to cancel.