The dotcom bubble

Market lessons remain relevant 25 years later

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Exactly 25 years ago, in March 2000, global stock markets hit record highs and then proceeded to collapse, correcting deeply through the next three years. The driver for the bull run was optimism about the internet economy—the so-called dotcom boom. The proximate cause for the correction was investors realizing that dotcom stocks were massively overvalued, thus leading to the bubble bursting. The correction continued as events like the terrorist attack on Manhattan's World Trade Center on September 9, 2001, changed the world. The subsequent invasion of Afghanistan spooked investors and retarded the recovery of the global economy.