Crypto is an ever-growing series of economic bubbles that expand and pop, giving rise to a new bubble bath before anyone has had time to recover from or recall the last round of swindles. Any normal person can’t keep up with the growing number of crypto frauds and bubbles. Crypto is a bubble, however. Bitcoin…
According to most definitions, a venture capital bubble began in the early 2000s. Venture capital businesses invest in high-risk enterprises for stock. Rich people, pension funds, or sovereign wealth funds fund venture funds (called limited partners or LPs). The venture fund invests it in early-stage companies. Most portfolio companies fail. Diversified funds return money to…
Accounting scandals and the dot-com bust hurt American markets. Riskier stocks outperformed bonds. Banks created a mortgage-backed debt market to give investors large returns with minimal risk (MBS). Mortgage-backed securities are traded by speculators. MBS holders get borrower interest and principal. Defaulting MBS owners can foreclose. By 2003, dot-com bubble mania and 9/11 shocks dissipated….
The 1990s dot-com bubble is the most recent in living memory. ARPANET was established to network government computer systems during the Cold War between the US and USSR. It allowed researchers at government labs and universities to share defense project information. Soon after, the internet’s scope and reach moved beyond the defense industry to commercial…
Collectible children’s toys generated a speculative craze in the 1990s. Beanie Babies were plastic pellet-filled teddy animals. They were designed by Ty Inc, an American toy maker, and initially targeted to youngsters. They rapidly become speculative adult collectibles. Rare Beanie Babies traded for ten times their retail value on sites like eBay. At eBay’s IPO,…
Houston Natural Gas and Internorth joined to establish Enron in 1985. As a tremendously diversified corporation that plays in the financialization of energy goods and the natural gas market, it would become a dominant player in the American energy markets. In the 1990s, the company’s expansion and good fundamentals made it a Wall Street favorite….
In 1991, Albania transitioned from communism to a free market economy with few institutions. Most crypto acolytes want a government-free fraudsters paradise. Several development “funds” offered to invest retail money in building companies and infrastructure. Investors stepped in because they promised large yields with insignificant risk. These funds were accounting-wise bankrupt from the outset. Without…
The 1920s saw strong economic growth, and a 9-year bull market peaked on September 3, 1929. The era included easy credit, expanding prosperity, materialism, and a liberalizing lifestyle. Faster speed, bigger shows, taller structures, looser morality, and cheaper alcohol. The Liberty Loan Act of 1917 permitted the US to issue Liberty Bonds for WWI. Bonds…
US believed in the 1800s firmly in independence. It had no governmental currency, so residents used whatever they wished. People utilized the few gold coins and banknotes legally issued by the mint, although they were in short supply. In the Americas, foreign and private currencies dominated commerce. These notes were all separately printed, and some…
In the 1840s, Britain was at the height of the industrial revolution, and inexpensive lending rates stimulated investment. Public money moved back into joint-stock enterprises as the middle class perceived better returns than government bonds. Early railway companies-built track and charged tolls, making them a reliable investment. Existing railroad companies were profitable and paid higher…
