Elias Mårtenson

With all the discussions about how we're now entering a new recession, it may be easy for people to try to compare to earlier recessions. As a long time has passed, there are now adults that were not working during the dot-com bust, so they are not fully aware of the events leading up to it.

This is a slightly edited version of a post I made on the Fediverse where I try to highlight this.

In the months leading up to the crash there was a lot of regular workers who invested everything they had in tech stocks because they had been going up so much. The expectation was that this was going to keep going up because the economic system had fundamentally changed. People honestly believed that this was the next step after capitalism and a new world where everything was available to everyone.

And it wasn't just regular people. I have told this story on the fediverse before, but this is clearly a good time to repeat it:

Not so long before the bust, I was working at Sun, and I was at some IT expo, working on the hardware that was being shown. As is common at these events, they had a small stage where different people did some presentations. One of the speakers in the stall was the former Minister of Finance in Sweden.

I was behind the screen behind him, probably trying to get one of the servers running and was listening to what he was saying.

At one point, he said: “one might think it's strange how there is a stream of money flowing into these companies, that does not make any profit”.

That's a good question, so what was his answer to this?

“That's the old way of thinking about things. This is the new economy. It doesn't work like the old one”.

The former Minister of Finance said that. I believe just before the bust.

In fact, now that I think about this, the term “the new economy” was being used a lot during the dot com bubble. People really believed it. Even ministers did. It was crazy.

I remember sighing a bit when I heard it, since I didn't believe it. Having worked for the last several years in the middle of the doc com bubble helped you get a pit of perspective, since you knew just how far away from the hype the tech actually was.

I can be reached on the Fediverse @loke@functional.cafe