"Paul Krugman believes that Greenspan has been waiting for the bubble to burst, so that he can clean up the mess after the bubble bursts. The Fed's interest rate hike will have a profound impact on the collapse of the Nasdaq index, which is dominated by Internet companies."
Paul Krugman is a columnist economic commentator for the New York Times. He will later win the Nobel Prize in Economics in 2008. He has a pessimistic view of the Internet all year round.
Before the bubble was inflated in 1998, Krugman believed that by around 2005, the impact of the Internet on the economy would not be greater than that of the fax machine.
"Burning, warns, internet companies will run out of cash faster than people think."
“MicroStrategy stock plunges 62%
Vienna-based software company MicroStrategy's shares plunged 62% yesterday after the company announced that its revenue for the first half of 1999 was much lower than initially reported and that full-year profits were expected to be a loss.
Under the Fed's interest rate hike and lack of profit correction, the company's stock price fell by $140 from a peak of $333 per share, and its market value fell as much as 62% in a single day. The personal fortune of its founder and CEO Michael Saylor A decrease of $6.1 billion.
Thaler believes companies are simply spreading the revenue from large, multi-year upfront payments over a longer period of time.
MicroStrategy's plunge is one of the strongest demonstrations of the volatility of Internet and other high-tech stocks and the questionable nature of the numbers some companies have been reporting. The surprising news that a star Washington-area company restated its financial results for the past two years has stoked investor anxiety about a technological revolution that some fear could also be a speculative bubble.
'We think this is a wake-up call for investors who have bought Internet-related companies,' said Jon Moody, a financial analyst at Scott & Stringfellow in Richmond. 'Perhaps this calls into question how we value these stocks. '
MicroStrategy's collapse also highlights investors' concerns about regulators and their growing sensitivity toward Internet companies.
Many companies calculate their financial results incorrectly and exaggerate their success. When companies need to recalculate results, the consequences for shareholders can be catastrophic.
'There is absolutely no fraud here, no signs of fraud,' Thaler said in an interview yesterday, adding: 'I don't think investors were misled. '
But Howard Schillett, who analyzes corporate financial data for institutional investors, said, 'For investors who rely on financial reports, this is a nightmare. '
Schlitt's Rockville-based company has issued two reports in recent months questioning MicroStrategy's financial reporting.
Analyst Bert Field said: 'I think they've crossed the line a little bit. ''Their classification of income is clearly more radical than the classification of income by others. '
U.S. Securities and Exchange Commission Chairman Arthur Levitt issued a warning about the company's financial statistics more than a year ago, saying: "Operating in a gray area between legality and outright fraud...financial statistics have long been dismissed." Twisted”.
Levitt believes one of the main areas of distortion is premature bookkeeping.
In December, the SEC issued new guidance aimed at clarifying existing accounting principles on how companies should calculate revenue. Thaler said these guidelines contributed to MicroStrategy's decision to reiterate its results."
MicroStrategy's market value exceeds 20 billion U.S. dollars. In the future, the company was sold for 27 million U.S. dollars at the bottom.
When BTC becomes popular, it will become the company with the largest number of BTC holdings in the world.
The collapse of MicroStrategy's market value became a landmark event for the bursting of the Nasdaq bubble. Everyone is seriously thinking about this issue. Nasdaq is overvalued.
In the past, only some investors and economists thought so. Today, especially MicroStrategy's valuation has plummeted due to falsified financial data, which has led to a crisis of trust among investors in Internet companies.
The Nasdaq market on the other side of the ocean is burning. Bill Gates, Jerry Yang, Gerald Levin and others, at the invitation of Zhou Xin, have come to China to participate in the first conference named "Internet Changes the World" Internet Conference.
Everyone is very interested in the Chinese market. Compared with Amerikan, China has a much larger population and huge potential.
On the first day, after Zhou Xin delivered a brief speech at the Internet Conference in the morning, the afternoon was the summit session. Zhou Xin could clearly feel that all the participants at the scene looked worried.
Someone reported the Nasdaq news to Zhou Xin in real time: "Boss, you are really amazing. Our robust strategy based on the S&P 500 combined with actual dividends and dividends has increased by more than 2% in the past week. ten.
Now, from Wall Street to Silicon Valley, more and more investors are beginning to wonder whether technology stocks are really worth so much money, no, everyone.
Everyone began to have doubts. When I was chatting with my friends who worked on Wall Street, they had begun to consider turning to mature stocks in traditional industries. "Warren Jensen's voice was full of excitement when he called Zhou Xin.
As the manager of Zhou Xin's asset management company, his salary is highly linked to the company's performance.
The general direction of the strategy was formulated by Zhou Xin, but the specific stock selection was done by him and the company's professional investors.
Before the bubble burst, many people knew it was a bubble, but regardless of whether it was a bubble or not, it could rise without thinking.
This is just like the brainlessly rising sector in Big A. Even if you know that the listed companies in Big A do not have this technology, AI is really the future. At most, the listed companies in Big A will only eat crumbs.
But there is no way you have to buy stocks of these companies for performance, revenue and profits.
The same goes for Nasdaq.
But Zhou Xin is different. After Zhou Xin completed the settlement with Time Warner and received US$45 billion in cash after paying taxes, he used half of it to formulate a steady direction focusing on S&P 500 index stocks.
As for why he didn't short Nasdaq, it was because Zhou Xin couldn't grasp the time before the bubble burst. He brought huge changes to the entire Internet market.
Especially quora, quora's success and business model have significantly pushed up the Nasdaq index. Zhou Xin cannot guarantee that the bubble will really start to burst like the original time and space in 2000.
As a result, the time was advanced, and the Nasdaq bubble burst earlier and fell faster.
Of the $74 billion in cash, only $46.62 billion was left after paying taxes. At the same time, Goldman Sachs had to pay related fees, and the final amount was $45 billion.
In the past week, their stock selection strategy has increased by 20%. In the past three months, it has increased by a total of 30%, which means that the stock market gains alone have reached $6.7 billion.
Zhou Xin said: "Continue to pay attention to the Nasdaq market."
The violent fall of Nasdaq is not yet a plunge, but it has been transmitted from the other side of the ocean to China.
Internet entrepreneurs who were originally able to get investment are now almost impossible to get money from Amerikan's investment institutions.
Chinese Internet companies listed on Nasdaq are also facing a sharp decline in market value.
All participants are affected by the entire environment.
Even so, the dialogue session between Bill Gates, Jerry Yang, Gerald Wright and Zhou Xin in the afternoon still attracted attention.
The lack of investment and the sharp drop in market value do not affect their desire to hear the opinions of the big guys.
“Before the start of the Internet Conference, the organizer asked me who would be the host of today’s highlight event. I thought about it and realized that there were already four of us here. If we add another host, it would be a bit crowded.
So I said, no, just let me serve as the host myself. It’s just to liven up the atmosphere, which I’m good at. "On Zhou Xin's left is Gerald Wright, and on his right are Bill Gates and Jerry Yang.
"The people here are Internet practitioners from all over the world. Everyone must be very concerned about what the future of the Internet will be like. What I need to do when running a business can meet the development of the times and the needs of users."
(End of chapter)
