How did the Internet bubble form?

1 and 1994, the appearance of mosaic browser and World Wide Web made the Internet attract public attention. For most American listed companies, public websites have become a necessity. Open direct business (e-commerce) and global instant group communication with the Internet as the medium;

2. Become a new best medium, which can instantly connect buyers and sellers, propagandists and customers at low cost. The Internet has brought various new business models that were not possible a few years ago, and attracted the investment of venture capital. At the beginning of the bubble, three major technology industries benefited from it, including Internet network infrastructure, Internet tools and software, and portals.

Enlightenment from the Internet bubble;

1. In fact, the most obvious puzzle in the macro sense of the American stock market is not the bubble caused by irrational prosperity, but why the stock price is always so low, which leads to the real return of the stock is so rich. This is the famous "mystery of equity premium". It seems that the American stock market is more prone to excessive caution than "irrational prosperity";

It is for this reason that I believe Greenspan is right. He said that it is not the government's responsibility to control the overvaluation of potential assets. If the potential bubble causes the risk of financial crisis to rise, it really needs to be monitored. But as long as the financial risk is low enough, once the government tries to correct the market out of fear of irrational prosperity, it is likely to do bad things with good intentions.