NEW ECONOMY, OLD HUBRIS.(Brief Article)

"It'll come back," the MBA-anointed sages droned as the once-invincible NASDAQ plummeted throughout the year 2000. "It's just a blip," said the 401 (k) day traders as the air hissed out of the Internet bubble. "It surely can't get any worse," insisted many investors and brokers as 2001 dawned. The subsequent undulations through the spring haven't inspired great confidence, and last year's downturn looks as if it might be with us for some time to come.

We can legitimately call it the Crash of 2000. And it banged up lots of vehicles. I think of one broker, an associate of mine among the sea of cubicles and quotrons that we inhabited 23 floors above the cityscape. Over the last couple of years he staked his reputation, and his clients' futures, on the blinking symbols of the New Economy that flashed in green across his stock-quote screen. As the NASDAQ flare shot higher and higher he was tethered to his desk like a man possessed. He traded clients' money with frenzy, into and out of a multitude of "first mover" dot-coms, with their "unique platforms," and "scalable business models."

"This time it's different" insisted many young, Ivy-educated stock analysts, who never slept but were in bed with every company they covered. Rising interest rates don't affect technology firms, we heard. Internet "page views" are the New Economy's replacement for stodgy old yardsticks like revenues that exceed expenditures. Callers clamored for our IPOs like crack addicts, and even the most risk-averse investors called looking for a "hot stock" to buy. The parade was passing by, and nobody wanted to be left out.

Buyers weren't interested in gloom-and-doom talk. They came to expect that every new account statement would bring them one stride closer to early retirement. I myself got caught ...