I unabashedly confess that I made a lot of money on tech stocks in the 90s. I'm a techie, and I knew what to buy and when to sell. It's like Las Vegas, except a little pertinent knowledge doesn't help you when you've bet hard 8s on the craps table, but it is extraordinarily valuable when wagering on technology stocks.
It is wagering. Don't fool yourself. And there's nothing wrong with it, any more than there's something wrong with making a reservation at the Wynn and fiddling with your mad money. At the Wynn, they ply you with free refreshing adult beverages. In the NASDAQ, the wins are bigger, but there's no free booze.
The NASDAQ lost a quarter of its value in one day when the internet stock bubble imploded. Most of the problem was that technology companies are long on ideas and programmers from India, and very short on physical assets. So when they die, there's not a lot of wreckage for the investors to divide up.
The ever so helpful government came up with the Sarbanes–Oxley Act to keep asset-light companies from achieving pre-IPO valuations way out of line with reality. The law is so complex in its reporting requirements that pretty much every compliance person admits that he doesn't understand every facet, and stays up nights planning his shuffle off this mortal coil rather than go to prison for something that honestly isn't his fault.
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