Wall Street Hype Has Evolved Since the Dot-Com Era
Similarities are everywhere, but investors need to understand five key differences.
Bloomberg, March 9, 2021
Everything old is new again: r/WallStreetBets is an updated version of Raging Bull; Is #FinTwit all that different from Yahoo! stock message boards?
All of the 2020 changes are simply a repeat of the 1990s, leading up to the eventual denouement: the 2000 dotcom implosion.
Or is it?
Today, I want to look at exactly who the internet driven trading environment has changed over the past 2 decades. As always, the devil is in the details:
What’s Changed Since the 1990s
1. Information sources
2. Social Media / Speed of transmission
3. Fake News / Disinformation
4. Effects of Covid Pandemic / Sheltering in Place / WFH
5. Passive Indexing
The specific details reveal numerous and significant differences from the 1990s, with very new and specific risks for investors, and even greater risk of loss for the causal trader.
~~~
I originally published this at Bloomberg, March 9, 2021. All of my Bloomberg columns can be found here and here.
