Dotcom bubble

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Dot-com bubble in the Nasdaq composite index

The term dot-com bubble is an art term coined by the media for a speculative bubble that burst in March 2000 , which particularly affected the so-called dot - com companies of the new economy and led to asset losses for small investors , especially in industrialized countries . The term dotcom refers to the Internet domain ending " .com " (English for commercial ). Other names were internet bubble or new economy bubble .

The dot-com bubble was a worldwide phenomenon. The largest market for technology companies was the US NASDAQ . In Germany, for example, Deutsche Börse set up the Neuer Markt as a separate market segment on which supposedly future-oriented and rapidly growing companies that were considered "technology companies" should be listed. Compared to the USA, the German dot-com bubble was heavily influenced by criminal entrepreneurs.

Boom phase

The boom was triggered by high profit expectations and speculation on rising share prices, which were sparked by new technological developments. The establishment of the Internet and the mobile phone as well as the development of handheld computers led to a mood of optimism in the field of digital technology. As a result, from 1995 onwards there were a large number of new companies (" startups ") and, due to the great interest of investors, there was an increasing number of IPOs. Many investors hoped that the companies operating in these markets were “future companies” and wanted to participate in supposed future profits by buying shares or to earn money from the resale of the shares due to the rising prices. In addition, the stock market flotation of Deutsche Telekom, which was accompanied by extensive advertising measures, led to the sharply increased popularity of the investment object , especially in Germany . From mid-1999, the stock market valuation of numerous companies multiplied within a few months due to significantly increased demand from new investors who were previously not active on the stock market.

This effect was reinforced by the strong urge to expand on the part of many companies; the liquidity generated by the IPO was invested in the purchase of further listed companies. Other investors were attracted by the often double-digit percentage price increases themselves, which they considered to be partially exaggerated, but from which they - often as day traders  - still wanted to benefit. Investment funds also reinforced the speculative bubble by offering their customers ever higher profits. A large number of "Neuer Markt", Internet, telecommunications and technology funds were set up, and sales were extremely good.

Above all, investors had exaggerated profit expectations, but ignored fundamental company valuations as well as annual financial statements . A high cash burn rate was even seen as a positive company characteristic. The media continued to stir up the euphoria, especially with regard to the issues of the Neuer Markt. Particularly in Germany, where the share was only made “national” a few years earlier with the launch of Deutsche Telekom , many inexperienced investors were lured into risky investments.

The German stock indices peaked on March 7, 2000. The DAX rose to 8,136.16 points during the day and closed at 8,064.97 points. The closing price was the only one over 8,000 points in this phase. The speculation with new issues , which had degenerated into a kind of popular sport during this period , also reached an unprecedented level: on March 13, 2000, for example, the day of the Infineon IPO, so many Infineon shares were traded that the trading systems of the Frankfurt Stock Exchange and thus at the same time the order processing of some banks collapsed. The internet service provider YLine , which is considered a key player in the new economy bubble in Austria, reached its high of € 278 on the EASDAQ index in March 2000. The company, for whose shares Lehman Brothers stated a price target of € 400 in June of the same year , got into over-indebtedness in July 2000, which it postponed with proceeds from share issues.


Towards the end of the boom, it became apparent that the highly valued companies would not be able to meet profit expectations in the foreseeable future. Their market value was mostly not covered by material equivalent values, since the capital of an IT company is to be found less in material goods than in the intellectual achievements of its employees. Often the book value of the company consisted of little more than a few buildings and the IT infrastructure. In addition, the companies acquired in the drive to expand were mostly not profitable.

The doubts grew louder when the first of the supposed hopefuls had to file for bankruptcy. In addition, it turned out that in some cases the reported sales were only bogus. When the prices began to decline in March 2000 and increased sales were made, the market collapsed completely. When the first signs of price decline became apparent, experienced stockbrokers withdrew their capital from the market. The persistent drop in prices caused the often new, inexperienced retail investors to panic and sell “at any price” in order to limit their losses. The price decline turned into a price fall.

Many small investors assumed that prices would recover, missed the right exit time and thus lost their invested capital.

Compared to the USA, the German dot-com bubble was heavily influenced by criminal entrepreneurs. At Comroad , the balance sheet was largely falsified by sham deals. At Infomatec and Metabox , among others , investors were misled by false ad hoc reports .


The subsidiaries, which had been bought at a high price years earlier, were mostly restructuring cases and therefore unsaleable during the crisis, so that only the bankruptcy option remained. After going public, some companies had lost all of their liquidity through ill-considered acquisitions and some of them have now become bankruptcy candidates themselves. For some companies, the price fell below book value, causing massive undervaluation of their stocks. The result was that some companies were bought up with the aim of liquidation in order to be able to sell at least the book values ​​(e.g. office buildings and patents) at a profit. The IT labor market, which had even recruited IT specialists from India due to a shortage of skilled workers in 1999 , had to familiarize itself with unemployment within a year .

Investors' trust in the values ​​of the IT industry remained disrupted for years. Up until 2004/2005 many companies were undervalued. The downsizing continued even when the IT sector began to show signs of recovery. Large companies in particular survived the stock market crash - but the previously fine granularity and the resulting diversity of the market have almost disappeared. The laid-off employees often found it difficult to find a new job, as they were often lateral entrants from other industries due to the labor shortage during the boom phase .

The central bank of the United States (Fed) reacted to the crash with a low interest rate policy in order to stimulate the US economy (see economic policy ). This and the global flight of small investors from the speculative markets of money trading and the internet economy, especially in classic real estate, favored a renewed price bubble in connection with speculation in the construction sector and in the mortgage market, this time on the real estate market (see real estate bubble ), which burst in 2007 on the not yet consolidated financial markets met and is considered to be the immediate cause of the openly erupting financial and banking crisis, and then the protracted world economic crisis . The US central bank chief Ben Bernanke explains the low global interest rates , with the associated increase in asset prices, such as recently in the housing market, with a glut of savings ( "saving glut" or global saving glut ). While emerging countries tried to save foreign currency reserves, there would have been a lack of domestic investment opportunities in the mature industrialized countries because of the high capital intensity they have already achieved . World savings flowed particularly to the USA, but also to countries such as Spain, where they depressed interest rates and increased property prices.

The New Economy, on the other hand - viewed as a whole - put up with the slump largely unscathed and achieved a completely new role in the international economy , for example with the hype surrounding Google and Facebook .


The dot-com bubble was satirically prepared in early 2000, among other things by the episode “Börsenfieber” of the NDR radio series “ Stenkelfeld ”. Here, IPOs of absurd online offers were presented, for example the domain www set up to give away windfalls , but then "sold for 350 million dollars to a well-known US computer company" . apple , which achieved astronomical sums on their first issue. This satirizes "the optimism on the stock markets and the willingness of small investors to boldly invest in everything that has anything to do with tech, bio, media or even .com."


  • Escape the offline world . In: Der Spiegel . No. 48 , 1999, pp. 152 ( online ).

Web links

Individual evidence

  1. a b Detlef Borchers: Ten years of dot-com bust: When the bubble burst . Heise online . March 10, 2010. Retrieved April 3, 2015.
  2. Historical price data for the DAX 30 ( Memento of the original from February 13, 2017 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. ,, February 27, 2017. @1@ 2Template: Webachiv / IABot /
  3. ^ A gold digger from the prehistoric times of the Internet , Der Standard, April 24, 2014.
  4. Yline crime: Boss Werner Boehm unpacks , format, 8 December 2012 found.
  5. ^ YLine bankruptcy becomes a case for the public prosecutor , Der Standard, September 2, 2002.
  6. Lucas Zeise: End of the Party - The Explosion in the Financial Sector and the Crisis of the World Economy, Papyrossa-Verlag, Cologne 2008, ISBN 978-3-89438-396-1 , p. 8.
  7. ^ Ben S. Bernanke: The global saving glut and the US current account deficit . Richmond, Virginia, March 10, 2005.