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What happened in the dot com bubble?
The dot-com bubble, also referred to as the Internet bubble, refers to the period between 1995 and 2000 when investors pumped money into Internet-based startups in the hopes that these fledgling companies would soon turn a profit. The dot-com bubble started to collapse in 1999.
Did the dot com bubble affect housing prices?
In 2000, the dot-com bubble burst, destroying $6.2 trillion in household wealth over the next two years. Five years later, the housing market crashed, and from 2007 to 2009, the value of real estate owned by U.S. households fell by nearly the same amount — $6 trillion.
What causes economic bubbles?
An economic bubble occurs any time that the price of a good rises far above the item’s real value. Bubbles are typically attributed to a change in investor behavior, although what causes this change in behavior is debated. This caused a huge surge in the prices of real estate and stock prices.
What caused the dot com bubble in the 1990s?
The dot.com bubble (also known as the dot.com boom, the tech bubble, and the Internet bubble) was a stock market bubble caused by excessive speculation of Internet-related companies in the late 1990s, a period of massive growth in the use and adoption of the Internet.
How did the dot-com crash of 2000 affect the economy?
In 2000, the dot-com bubble burst, destroying $6.2 trillion in household wealth over the next two years. Despite seeing similar nominal dollar losses, the housing crash led to the Great Recession, while the dot-com crash led to a mild recession. Part of this difference can be seen in consumer spending.
What happened to the dotcom bubble in 2000?
And the “dotcom” economy was chugging along, with new internet-based companies seeming to pop up every single week. But in March of 2000, 15 years ago, one of those things came to a crashing halt. The dotcom bubble, which had been building up for the better part of three years, slowly began to pop.
How did the dotcom crisis affect the US economy?
The rating agencies also gave false speculations on the individual stocks. So the were highly overvalued creating the bubble. The dot-com crisis had an effect not only on the economy of USA but also the rest of the world.