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Technology Bubbles Are Good

Published: 10/9/2007 8:25:00 PM

I read a recent interview of Bob Metcalfe where he says (paraphrasing) "Bubbles are good - they speed innovation by attracting lots of investment."

This concept sits well with me, harsh as it may seem because most of the participants (and their investors) in bubbles will lose. Look what it did to the nascent car industry decades ago, or to the Internet, or to the telecom industry, or to Web 2.0 companies, or what it will do to ethanol/energy sources here in the U.S.

My belief is that bubbles only hurt the economy in two areas where the result is not technology advancement - real estate and the stock market. Breaking bubbles in those two industries don't really leave pieces to be picked up and reassembled into something greater than before.

The U.S. has always been a boom and bust kind of place, taking two steps forward and one and a half back in whatever industry you want to name.

Don Jones

VentureDeal

 

Don Jones
CEO, VentureDeal

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