The Trojan Horse

And valuations fell further, and fundamentals began to collapse beyond the Internet because all those great fundamentals were built upon bubbled funding. And so valuations fell further and the whole bubble popped. (I'd note that the teleconomy underwent a very similar bubble that also had to be unwound.)

One of the reasons I remain bullish about both the Internet, the companies that supply into it, and the teleconomy is that things are no longer built upon those unsustainable and bubbled companies. As James noted, there were some winners to be had back then, and many of the winners have been borne out and new companies -- like Google (GOOG - commentary - Cramer's Take) -- are rightly tapping the public market to raise capital, and big ones -- like Yahoo! (YHOO - commentary - Cramer's Take) and eBay (EBAY - commentary - Cramer's Take) -- use cash flow from operations to fund their growth and spending. What a concept!

My favorite saying is a derivative of Aristotle's "A is A" rule -- it is what it is. And in this case, the bubble was what it was -- a bubble.

1 What would best describe your stance heading into the coming week of trading? Bullish Bearish Neutral 2 Which of these sectors do you think is set to move up in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities 3 Which of these sectors do you think is set to move down in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities View the results without voting