The DotCom Bubble
The DotCom Bubble was created by expectations and speculation. Technology driven increases in productivity growth gave rise to expectations of growths in earning and stock prices.
Also, these increases in stability reduced the perceptions of risk and led to a sharp rise in employment, as seen by the graph with the lowest in 1999 and 2000, just before the bubble burst.
Talk of the bubble's creation began and expectations of the future became uncertain. With low expectations, people began to withdraw their money from these stocks. The fear of the bubble bursting became a self-fulfilling prophecy and with no investors, the bubble did eventually burst and we saw the increase in unemployment in 2001.
Also, these increases in stability reduced the perceptions of risk and led to a sharp rise in employment, as seen by the graph with the lowest in 1999 and 2000, just before the bubble burst.
Talk of the bubble's creation began and expectations of the future became uncertain. With low expectations, people began to withdraw their money from these stocks. The fear of the bubble bursting became a self-fulfilling prophecy and with no investors, the bubble did eventually burst and we saw the increase in unemployment in 2001.
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