FORTUNE — I’m calling a top to the pundit bubble. All week, spurred by Color’s gaudy valuation, the tech and economic punditry have continued their months-long monologue about whether or not we’re in a tech bubble. Back and forth they went, inflating nothing but their own self-importance as they jostled to be the one on the right side of history. (Call it the Roubini Effect.)
The only way to keep track is to grab a napkin and keep a running bubble pro/con list. Put it right next to that million-dollar startup idea you wrote down during lunch.
- A sample slide presentation of why Color deserved the money.
- A fearless, incisive review of Color’s inanity on the App Store.
So let’s just call it even. Because far more interesting than the question of whether we’re in a bubble is the question of why we’re so consumed with the question of whether we’re in a bubble. This impulse, this insuppressible urge to take a definitive stance on what is almost certainly an indefinite situation—why?
Because we’re still exorcising our ghosts. But not the ghosts of 2000. The far fresher ones of 2008.
When the tech bubble collapsed in 2000, $5 trillion evaporated from the NASDAQ, vanishing even quicker than it appeared. Tell-all books were published—Dot.con, Dot.Bomb, which was which? PBS did a major retrospective documentary called, yes, Dot.con. (Funding in part provided by Earthlink (ELNK), whose stock was on its way to a 75% decline.) And ethics violations soon gave rise to a new crop of political avengers capitalizing on our anger. (The biggest, Eliot Spitzer, would later fall as he watched his foil, Henry Blodget, rise.)
But as the Boom! column showed in the above chart, this is a different situation than in 2000. Because most of these companies are still private, the superrich is in control of the economy for the rest of us. They’re the ones with access to tech incubators, business plans, balance sheets, and the secondary markets. The 2000 crash also left behind, among other things, a ton of fiber optic cables that we still rely on for broadband today. It’s not entirely clear what, say, Zynga leaves behind if this bubble — again, if there’s a bubble — pops. All that farmland can’t be repurposed.
This combination—rich people, empty growth, and a lack of transparency—should sound familiar. Like, 2008 financial crisis familiar. (With all the obvious caveats of web startups being a far smaller industry than housing and finance, etc. etc. etc.)
And now, just two and a half years later, we’re faced yet again with the prospect of not having the money we thought we had. We’re still recovering from the last shock, how can we already be willing to trust capitalism again? Unemployment is still high, the housing sector is still depressed, and any world uprising/tsunami/debt crisis threatens to wash away the small steps we’ve made toward stability. It would be irresponsible to blindly believe the supposed good news coming out of Silicon Valley! It must be a trap. It has to be a trap. These people say they can make our lives easier, if only we give them a little bit of money. We’ve heard this before. Theoretically, America the hopeless romantic can only get burned so many times before she joins a convent. But in reality, it just doesn’t seem like she’ll ever trade one habit for another.
–This is the first column in Fortune’s new look at the startup economy. Every week you’ll get a new dispatch from the bubble that may or may not exist. Send your froth to [email protected] or come talk shop on Twitter.
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