Remembering The Last Crash
A local high tech company sold today for about $300 million. That sounds like a lot, but back in the go-go days of the 1990s the company, Vignette claimed to have a worth of $15 billion. That was before the famous dot.com bubble burst sending everyone’s 401 k spiraling back to earth. I had built mine back up to dot.com levels when the ‘derivative” crash hit last year, sending my stock investments down to 2001 levels. Shirtsleeves to shirtsleeves in just eight years. Easy come, easy go. The American economy has this was of tricking the average investor into thinking that he knows something and then hitting him over the head (repeatedly) with the plain fact that the dumbest people are not those who know nothing, but rather those who think they know something and really know nothing. Guys like me should put what little savings they have into a mattress and hope it’s still there when they are kicked out into the streets.
The epicenter of the dot.com days was Austin, Texas. Let me tell you, there was never a more despicable group than the dot.com millionaires. It turned out, of course, that all of them were charlatans of the highest degree who had somehow flimflammed investors into believing that revenues were the same as profits. We all temporarily forgot the old adage that you could “gross your way” right into bankruptcy. It is the “net” that is important, and a net is what was needed for those who believed otherwise.
Most of the dot.com guys were geeky, skinny, bearded pseudo-intellectuals. They came in two varieties, those who knew a lot about science, but nothing about business and those who knew a lot about the old “okie-doke”and nothing about science. When they worked together, they were an incomparable team. A lot of them managed to sell out and avoid the really big losses themselves. These guys were the most arrogant, greedy, self-congratulatory, self-absorbed, hypocritical, stingy, habitual liars that ever temporarily seized control of the American economy (until the derivative gurus came along). They strutted around the streets of Austin, building their show palaces and their private rock climbing walls. They discovered
expensive wine and private jets and acted like they had discovered capitalism, instead of actually perverting it. They also managed to turn everyday business dress into something that would have been inappropriate to wear to a Goodwill store. They wanted all business conducted at “internet speed” which was another way of saying slipshod and sloppy. This nonchalance with legal formalities left things even harder to unwind once they had all screwed the collective pooch. I am POSITIVE that they will have their own circle of hell when the time comes for their departure from this veil of tears, which , frankly cannot come too soon for them as far as I’m concerned.
I see also today that one of the dot.com guys ( a game inventor) is suing a company for $27 million for saying that he quit and was not fired. Apparently, he had to exercise his stock options immediately which meant, like the rest of us, he lost his shirt in the current market. He did this while flying around in a Russian spaceship, something that he claims he spent “most of his fortune on”. Well, too bad. I have no doubt that he was screwed around. But my guess is that he has enough money left to last several lifetimes and maybe even fly to Mars if he lives long enough. You won’t see him eating at the Salvation Army anytime soon. Well, at least he’s keeping some lawyers busy. Hope he gets what’s coming to him.
If all of this diatribe leaves you with the general impression that I live a jealous and often bitter life, well you would be right. There is no excuse for it, but deep within me rages the heart of a petty and ultrasensitive man. I am the first to think that I deserve everything that everyone else is getting and more. My belief is that it is all luck and timing which sets me apart from the elite. I am the embodiment of what Twain meant when he said that every parallel of latitude thinks that it would have been the equator it if had just gotten what was rightfully coming to him. Although I would have settled for the Prime Meridian, I have never been greedy.