[Chapter 887: A Little Bit of Foam is Quite Nice!]
In the future, when people mentioned foam, they would conjure two major ideas in their minds: one being the real estate bubble in Japan, and the other the internet bubble. The origins of this internet bubble could actually be traced back to the IPO of Netscape.
Indeed, bubbles led to wasted investments and market distortions. However, the scale of these bubbles was not as large as most had imagined.
In fact, from William White's perspective, it was precisely this irrational influx of capital that enabled the U.S. economy to maintain growth over the next few decades.
Of course, there were indeed companies that acted recklessly, lacking any coherent business plan, and were merely peddling concepts.
When the tide suddenly receded, those without proper clothing would naturally be eliminated by the market.
"Alan, what's up? Are you hiding from those reporters too?"
When he saw that mischievous old fool, Greenspan wore a look of disapproval.
"Hmph, shouldn't you be talking? If you weren't hiding out in the countryside, you'd probably be in no better position than I am," he scoffed.
Warren Buffett only shook his head and smiled wryly, seemingly unable to say anything else.
Once old man Bush took office, he proposed a high-performance computing act. Unfortunately, similar to the Star Wars project, it sounded great, but once it arrived at state governments, the act was more or less disregarded.
Well, funding was easy to discuss, and tax cuts would be welcomed. As for that fiber optic backbone you mentioned, what practical use does it have?
Without visible benefits, no one would support it. You could preach all you want, but this internet thing--it's not exactly military-grade technology, is it? Now, you want us to get involved, but who knows, it might just be used to launch missiles.
"There's nothing we can do, Alan. Right now, every state is getting involved; no one wants California to monopolize the tech scene. If your out-of-the-way place could spawn Silicon Valley, why can't we?"
Greenspan remained silent for this very reason.
Was the internet useful?
Of course it was; William White wasn't wrong, they just didn't understand.
If books and audio-visual products could be sold through the internet, why not other items too? Could cars and real estate--those big-ticket items--also be sold online one day?
No way?
You say it's useless, but you completely miss the point; you're just two outdated old-timers.
"Yeah, the stakes are really high here, and the public seems to have a demand for it. But honestly, I don't know how to value that $7 billion market cap."
William White had no clue what those two old fogies were talking about, and even if he did, he wouldn't care. They were barely scratching the surface. By the end of the year, they'd see it might even soar. Two hundred billion in valuation was not out of the question.
Nowadays, a company couldn't even leave home without printing .COM on their business card. Forget about the U.S.; the whole world was on this wavelength. Japan, Hong Kong, Taiwan, China--all buzzing with information superhighways.
What on earth was this thing good for?
That was hard to say. At the very least, it made communication easier. Work efficiency increased.
"Warren, ICQ is starting to charge fees, and it seems to be going well. I've heard they already have 500,000 paying users."
"I don't get it," Buffett shook his head; whenever high-tech companies came up, the old guy instinctively resisted.
"His revenue and expenses don't balance at all. When he hits ten million paying users, I'll admit he has value."
That pretty much defined the generation gap. Five hundred thousand was actually an impressive number already.
Let's not forget, the registered user count had long surpassed ten million. Plus, its growth rate had never shown signs of slowing down.
Buffett genuinely didn't know that the so-called paying user count wasn't what William White cared about; he hadn't even asked ICQ to grow that user base.
The difference between paid and unpaid users was actually very limited. For businesses and professional users, paying wasn't even necessary.
"James, this ICQ isn't really much different; it's just a slightly bigger email."
"Marc, group limits can be restrictive--most people won't even use them. That VIP badge? I have to admit, it's kind of tacky."
"Right, many of my classmates don't need it, but they still became paying users. James, should we also develop an instant messaging software? If we bundled it with a browser, wouldn't that open up additional revenue streams?
To be honest, I lose sleep over the company's current market cap."
"Damn it, Marc, don't use those herbs; they won't help you. The barriers to communication software are too high unless you plan to go free."
"Free?" Marc Andreessen scoffed; free was definitely not an option--that plan would get him roasted by shareholders.
"Marc, since free isn't possible, what do you plan to use to compete? Doesn't Japan and Europe already have similar software? They crushed any that just popped up."
"Sigh, I was just saying, this current valuation is torture for me."
James Clark cursed silently; when the guy was out clubbing, he didn't say it was torture. Sigh, the kid was still a bit too restless; he needed to look at those like William White; what he was doing was little in comparison.
Among the two fortunate ones in others' eyes, they both felt confused and distressed, not to mention the other colleagues in Silicon Valley.
From that day on, America entered an era of wild possibilities. With Netscape's stock price continuously climbing, Silicon Valley, the U.S., and even the world fell into a kind of collective buzz.
Wall Street investment firms were not just throwing money in Silicon Valley but around the world. If you could get even a tiny association with .COM, you might attract angel investors.
Hong Kong, Taiwan, Japan, China. The storm stirred up by America was sweeping the globe at an astonishing rate.
Was the bubble really bad?
Not necessarily!
Look at the Fortune 500 companies that emerged from this era. If you summed up the stock indices of these companies, you'd be surprised to find that, hey, the money evaporated during the internet bubble seemed to have returned.
The collapse of the internet bubble wiped out about $5 trillion in market value. So the question is, how much market cap do those later high-tech companies hold altogether?
This means if you had bought Nasdaq component stocks at the peak of the internet bubble, as long as you held on long enough, you wouldn't necessarily lose money. Actually, it's not even about how much you lost, but rather how much you gained.
To be honest, had it not been for this round of the internet wave, the U.S. economy would have collapsed way earlier. Other than these internet firms, was there any decent company in America after the millennium?
What's most amusing?
When the bubble burst, it wasn't just America's money that got burned. In fact, oil-rich nations, Japan, Germany, a sea of wealthy individuals suffered severe losses.
As for the U.S., they only lost paper wealth. Companies like Yahoo, Cisco, and Microsoft saw their stock prices recover shortly thereafter.
Cough cough, it seemed those taken advantage of were not America.
Using international speculative capital to develop their own internet businesses, and once they're done, it's easily buried. When those companies regained their vitality, that bunch of wealthy individuals would be too scared to invest again.
Damn, you all are so shameless!
*****
https://www.patreon.com/Sayonara816.