Dot.Con: The Greatest Story Ever Sold [Hardcover]

John Cassidy (Author)

Book Description

Publication Date: February 5, 2002

When Vannevar Bush, Franklin D. Roosevelt's chief scientific adviser, sat down in 1945 to write a magazine article about the future, he had no idea what he was beginning. Bush's vision of a desktop computer that would contain all of human knowledge inspired the scientists who built the Internet. In the early 1990s, when a British computer programmer devised the World Wide Web and an Illinois student invented an easy-to-use Web browser, the Internet was transformed from a scientific curiosity into the biggest gold rush since the Klondike.

In Dot.con, John Cassidy, one of the country's leading financial journalists and a staff writer at the New Yorker, relates the stories of Netscape, Yahoo!, America Online, Amazon.com, and other Internet companies, large and small. In a lively and entertaining narrative, Cassidy traces the rise of Internet stocks and the development of a populist stock market culture to the end of the Cold War. He shows how an unscrupulous alliance of entrepreneurs such as Jeff Bezos, venture capitalists such as John Doerr, stock analysts such as Mary Meeker, and investment bankers such as Frank Quattrone helped turn an exciting technological development into an unstable and dangerous speculative bubble.

Cassidy doesn't restrict his attention to Silicon Valley and Wall Street. He demonstrates how many prominent journalists and policy makers helped to expand and prolong the bubble, particularly Alan Greenspan, the chairman of the Federal Reserve.

But in the end, Cassidy concludes, responsibility for the Internet boom and bust cannot be placed on any one individual. It was a nationwide epizootic that involved tens of millions of Americans. And now that it is over, the country as a whole is paying a heavy price for succumbing to greed and wishful thinking. An artful blend of storytelling, history, and economics, Dot.con provides the first complete and authoritative account of the biggest financial story of the modern era.

Editorial Reviews

Amazon.com Review

John Cassidy’s Dot.con is the most sweeping and definitive assessment published thus far of the stock market mania that swept this country in the late 1990s. Cassidy, who covers economics and finance for The New Yorker, finds many seeds for the boom: Vannevar Bush’s “memex” machine, the “intellectual forerunner of the World Wide Web”; increasing popularity of 401(k)s and IRAs, which introduced millions of Americans to the equity markets, giving rise to a “stock market culture"; and the attention and hype in the late '80s and early '90s surrounding the “information superhighway” promoted by the likes of Al Gore, Newt Gingrich, and Nicholas Negroponte. When Netscape went public in 1995, the Internet mania began a five-year run that was fueled in part by the media, the policies promoted by Alan Greenspan and the Federal Reserve, the rise of day trading, and the deluge of IPOs brought to market by firms such as Morgan Stanley and Merrill Lynch and their analyst cheerleaders Mary Meeker and Henry Blodget. For anyone who got caught up in the mania and foundered in its eventual crash, Dot.con is a bittersweet trip down memory lane that Cassidy captures just perfectly. Highly recommended. --Harry C. Edwards

From Publishers Weekly

This book's epigraph, "Ever get the feeling you've been cheated?" (by Johnny Rotten), perfectly sets the tone for what follows. Cassidy certainly knows he was cheated by the collapse of Internet stocks, and here he sets out to discover who's to blame. His search includes a history of the stock market (starting in ancient Rome) and finds that most buying manias and speculative bubbles were encouraged by unscrupulous financial professionals. He traces the Internet to Vannevar Bush's work during World War II. Its developers "tended to be young men with long greasy hair, thick glasses, and an obsessive interest in science fiction," who were held in contempt by the rest of the world. But Cassidy, an economics writer at the New Yorker, goes beyond these usual suspects of stock brokers and computer geeks. He devotes two chapters to criticizing Alan Greenspan for making "frequent references to the benefits of new technology," among other things. The author indicts many additional public figures, journalists, analysts, authors and businesspeople by name and finds them guilty. Despite the sensational charges, there is little new here. It's hard to believe that anyone will be shocked to learn that most Internet companies and day traders lost money or that venture capitalists, investment bankers and stock analysts made large fees promoting stocks without subjecting the companies in question to critical scrutiny. Cassidy does not even deliver an entertaining rant. Most of the pages are uninspired chronicles of well-known events. Agents, Andrew Wylie and Jeffrey Posternak. (Feb.)Forecast: The large number of people who lost money in Internet stocks will be predisposed to accept this book's premise. The fair-minded ones will want a better analysis; the angry ones will want more dirt or passion.

Copyright 2002 Cahners Business Information, Inc.

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Product Details

• Hardcover: 384 pages
• Publisher: Harper; 1st edition (February 5, 2002)
• Language: English
• ISBN-10: 0060008806
• ISBN-13: 978-0060008802
• Product Dimensions: 9.4 x 6.2 x 1.2 inches
• Shipping Weight: 1.2 pounds
• Average Customer Review: 3.7 out of 5 stars  See all reviews (50 customer reviews)
• Amazon Best Sellers Rank: #1,555,699 in Books (See Top 100 in Books)

More About the Author

John Cassidy is a journalist at The New Yorker and a frequent contributor to The New York Review of Books. He is the author of Dot.con: How America Lost Its Mind andMoney in the Internet Era and lives in New York City.

Customer Reviews

Most Helpful Customer Reviews

16 of 19 people found the following review helpful:

4.0 out of 5 stars Good if dry coverage of dot.com bust, June 12, 2002

By 

Peter Lorenzi (Maryland, USA) - See all my reviews

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This review is from: Dot.Con: The Greatest Story Ever Sold (Hardcover)

There have been a lot of books about the crash of the high tech market. This is one of the best. The coverage is thorough if at times tedious. Cassidy makes an excellent case that the lack of a business model and the prevalent "greater fool" theory led to the demise of the Internet bubble. Too many pitched the idea that if their site captured just one percent of a [Hundred] billion-dollar market, than the firm would be a success. Only even one percent was a pipe dream, and perhaps a dozen firms had the same idea. And the "greater fool" theory suggests that even if the originators are wrong, somebody else will be foolish enough to buy them out.

Cassidy concludes his good work with a lengthy table of dot.com failures, a sobering story in itself. Perhaps it is so sobering that the life and exhuberance of the subject drained away. I found the last third of the book to be more of a continuous litany of mistakes and I lost much of my interest.

6 of 6 people found the following review helpful:

4.0 out of 5 stars Competent overview but not without flaws, April 29, 2003

By 

O. Buxton "Olly Buxton" (Highgate, UK) - See all my reviews
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This review is from: Dot.Con: The Greatest Story Ever Sold (Hardcover)

The first thing you'd say about this book is that, however clever the title, it's erroneous: this isn't the story of a "con" at all, it's the story of a speculative bubble.

The whole point is that no-one was "conned" by the hot air. As Cassidy mentions from the outset, the prospectuses all contained large print health warnings in prominent places: "THIS COMPANY HAS NEVER MADE ANY MONEY, MOST LIKELY NEVER WILL" - but the punters still bought and bought. There were many psychological and sociological factors at play, but deception was not one of them.

For all that, Dot Con is well researched, well written and entertaining into the bargain (my copy was the paperback second edition in which the typos & manifest errors spotted by keen Amazonians (none of which, in my view, was earth-shattering) had been corrected). Cassidy describes briefly and competently the history of the internet and the general financial environment of the last 50 years, and then takes you into the maelstrom of the bubble from 1995 to 2001, all of which he portrays in suitably stunned-mullet fashion. The new edition features a lengthy epilogue which surveys the wreckage and covers the subsequent inquiry into the practices of investment banking firms and their uneasy relationships with their research analysts, all of which is still very current.

While he doesn't really dwell on it, I think Cassidy would come out in favour of more market regulation and intervention: He's especially critical of the Fed's approach to monetary policy and the atmosphere on the street which led to the boom in the first place.

In some ways (though it's hardly fashionable to say so) the investment banking firms and fund managers were as much victims of this as anyone: while the roof is blowing off the market and the choice is to join in and make hay, or watch your competitors annexing large portions of your market share while you sit on your hands, it is a singular Wall Street firm indeed which chooses to sit the boom out.

In any event this is a thoughtful and well put together book and serves as a pretty good overview of some of the most remarkable times in the history of modern finance.

32 of 42 people found the following review helpful:

1.0 out of 5 stars Embarrassing errors, spelling mistakes and confused facts, September 26, 2002

By 

Carey A. Holzman (Glendale, AZ USA) - See all my reviews
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This review is from: Dot.Con: The Greatest Story Ever Sold (Hardcover)

This should be a book of fiction. I don't know if I can count all the obvious factual errors. Paul Allen, co-founder of Microsoft, has his name wrong. He claims the Altair computer was named after a character in Star Wars. If the Altair computer was invented in 1975, and Star Wars came out in 1977, how was that possible? Duh... The book states: "In 1978, two Chicago students, Randy Seuss and Ward Christensen, invented the modem...."
No they didn't! In 1977, Christensen wrote Xmodem, the first computer program used to transfer files between computers equipped with modems; a year later, he teamed with Seuss to create the first "bulletin board system" software.
Again, Duh....
The CON here is obviously the publisher, Hyberbole, who got conned by a financial writer who apparantly had a bunch of news snippets he gathered to form a book. There is NO STORY here. Just pieces of information pasted together to form a book. The sad part is, much of the information is mis-spelled, misunderstood by the author, grammictally incorrect or just plain false.
To think people are reading this and thinking they are "Learning" something about the internet craze would be like reading a science fiction novel and think you are learning about NASA.