By Dale McFeatters Remember March 10, 2000? Neither do a lot of other people. That’s the official end of the dot-com boom and the start of the dot-com bust. The bubble burst that day. A lot of companies with wildly inventive names that promised “the next big thing,” whatever that was, disappeared, leaving behind fancy open-plan offices and recreational equipment. They all shared grandiose dreams and no revenues. Unfortunately, the hard rules of economics still applied. Did we learn from this experience? Of course not. We’re Americans. We like booms, so much so that we quickly forget the inevitable chastening bust. AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREGame Center: Chargers at Kansas City Chiefs, Sunday, 10 a.m.Railroads, oil wells, transistors, holding companies, conglomerates, traction companies, aerospace companies, Florida real estate. We love this stuff. Not that people don’t profit from booms and busts. A lot of people profited big from the Gold Rush but it wasn’t the prospectors but the people who sold stuff to them. Did the prospectors learn from this? No, they rushed off to Alaska. Many analysts believe that it was pent up demand for another boom that led to the bubble and subsequent bust of the subprime mortgage market and the consequent housing slump. “Subprime,” it turns out, is a fancy way of saying, “You ain’t gonna get your money back.” The very astute business writer Allen Sloan analyzed one subprime offering by a respected investment banking house. Wait until you hear it. You’ll be kicking yourself, asking, “How did I miss out on this?” It would be like getting in on Enron in September 2001. The company sold shares in a package of second mortgages, largely on homes in California. A second mortgage means that someone else is first in line to get the money if there is a foreclosure. The homeowners’ average equity was 0.17 percent (20 percent is a standard down payment on a conventional “prime,” so to speak, first mortgage, but where’s the fun in that?), and in over half the loans, the borrowers’ incomes or assets had never been verified and neither was whether they were even living in the homes. Inevitably, this particular investment, and many others as well, tanked in dramatic, bustlike fashion. So what is the next highly speculative investment for capital in search of excitement? Do the words “Silicon Valley startup” and “initial public offering” do anything for you? Yes, the dot-coms are back and beginning to form a bubble. The New York Times reports that Facebook, which it delicately calls “financially unproven,” is being valued by investors at $15 billion. This time, however, investors vow that things will be different. Right. They were undeterred by eBay’s admission that the $3.1 billion it paid for Skype was way too high, by about $1.4 billion. Once again the investors are flocking to startups that have no revenues or even prospects for revenues. One entrepreneur, according to the Times, “says that the company was not currently focused on making money and that no one in the company was even working on how to do so.” Talk about a business plan. Another entrepreneur said he and others “had begun to think that the financing game is best played by avoiding actual revenues – since that only limits the imagination of investors.” And what do you call an investor who overlooks the fact that the company doesn’t actually do anything to let his imagination run wild? How about “sucker”? March 10, 2000. It seems like only tomorrow. Dale McFeatters is a Washington-based editorial writer and columnist for Scripps Howard News Service. His e-mail address is [email protected] 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!