From: Reason (reason@exratio.com)
Date: Sat Jun 29 2002 - 14:26:14 MDT
As usual, mises.org provides a relevant article to the conversation taking
place on the list.
http://www.mises.org/fullstory.asp?control=991
A theory of boom-bust cycles in business occurs after the explicatory
preamble. YMMV, since no-one with any clout these days seems to take this
sort of economics seriously. Sadly.
Reason
http://www.exratio.com/
> -----Original Message-----
> From: owner-extropians@extropy.org
> [mailto:owner-extropians@extropy.org]On Behalf Of Harvey Newstrom
> Sent: Saturday, June 29, 2002 12:44 PM
> To: extropians@extropy.org
> Subject: Re: Was the Internet Boom a Myth?
>
>
>
> On Saturday, June 29, 2002, at 01:43 pm, Max More wrote:
> >> Apparently, they reserved profits in good years off the books to add
> >> in later during lean years to make themselves always look profitable.
> >
> > If Microsoft were in trouble for this, many other companies will be. It
> > seems to have been a very common practice.
>
> That's what makes me question the Internet boom now. IBM likewise used
> accounting changes to increase profits in the early 1990's. Whatever
> they did is now over, and their profits are back to normal. With no
> change in their revenue stream, they appeared to recover, get a lot more
> business, and then bust about 10 years later. It was all an accounting
> trick, with no real change in business levels. I wonder if a lot of
> Internet boom was like this, where the numbers inflated, and the
> accounting looked good, but nothing really changed in the real world.
>
> The other thing that bothers me about the telecomm accounting scandals,
> such as WorldCom, is that we have been using these numbers to estimate
> the growth of the Internet. If a lot of their customers, revenue, and
> capital investments in the Internet were overstated, our estimates of
> how fast the Internet has grown might be similarly overstated.
>
> --
> Harvey Newstrom, CISSP <www.HarveyNewstrom.com>
> Principal Security Consultant <www.Newstaff.com>
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