• As Mark Twain almost said, history doesn’t repeat, but it does cache. That’s the fear for many surveying the exuberance around technology stocks – it all just looks a little too much like the dotcom bubble of the late 90s.
Investors are crouching sweatily around the likes of Facebook, Twitter, Zynga and Groupon, and scores of other new digital enterprises that could be the Future. Share values are skyrocketing, and observers with “memories of the internet bust a decade earlier are wondering whether this sudden burst of activity spells danger for the industry once again”, notes the New York Times.
There are a few big differences this time around, cautions Alexander Hotz at the highly regarded Mashable website. Today, startup costs are much lower; there is less rush to float on the stockmarket; and the startups’ ambitions are less “hubristic”. But for self-described “serial entrepreneur” Steve Blank, writing at Forbes.com, “the signals are loud and clear… We’re now in the second internet bubble.”
But as the pin moves inexorably closer to the bubble’s skin, your startup can succeed. You need simply to “be everywhere and look larger than life”. Piece of cake.
• Among the speculators puffing warm air into this putative bubble are the hedge funds, those giddy things that give a bad name to hedges. One such fund, a $53 million pot at Derwent Capital Markets in London, has fallen in love with Twitter – not as an investment, but to divine what to invest in. This is called “sentiment analysis”, reports Paid Content. Virtual robots will scour the microblogging site for Tweets referring to stocks, put them into “one of six emotional buckets: tension, depression, anger, vigour, fatigue and confusion”, and invest accordingly.
It might sound a bit bonkers, but it’s not that new. The eccentricities of what they call robotic trading programming were recently exposed by a rookie financial analyst at the Huffington Post. Dan Mirvish found that stock in Warren Buffet’s massive conglomerate Berkshire-Hathaway bumped up every time a movie opened starring Anne Hathaway – presumably because those robots got drunk on the frothy media coverage.
Far-fetched? Probably not, says the Atlantic’s Alexis Madrigal. He was astonished to hear from experts some of the things these robots would do for their hedge-fund masters. Like this: “Oh, it’s raining in Kazakhstan? Buy pork bellies in Brazil! And sell wheat in Kansas! Dump Apple stock! Why? Because the computer says that the 193 out of the last 240 times it rained in Kazakhstan, pork bellies in Brazil went up, and wheat prices and Apple shares went down.”
• If you’ve ever wondered just how susceptible you are to gobbledegook, the New Scientist offers an entertaining self-appraisal. A short video by psychologist Richard Wiseman tests whether you are “the type of person that hypnotists, magicians and mind-readers seek out”. Says Wiseman: “Non-suggestible types tend to be more down-to-earth and logical and enjoy puzzles and games. In contrast, suggestible types tend to have a good imagination, be sensitive and intuitive and find it easier to become absorbed in books and films.” For this exercise, it comes down to how far apart your palms end up. My hands indicate I’m just a bit suggestible. But I still have no recollection of shaving off my eyebrows.
• Big news from the world of books. A five-volume collection examining the achievements of the North Korean leader, Kim Jong-Il, is to be published next year. The Korean Central News Agency has the inside track on the series, dispassionately titled Comrade Kim Jong-Il, Legendary Great Man. Chapter one is called “The Genius Glorifying the Idea of the Times”. Chapter two: “Great Master of Political Philosophy”. Three: “Great Master of Popular Philosophy”. Four: “Teacher Indicating the Road to Be Followed by Mankind”. The very same edition of the KCNA, the People’s Republic’s only and best English-language news source, reveals the Dear Leader is not merely a man of letters. The other day he “enjoyed a demonstration of synchronised swimming”. The numbers included We Sing of the Party, Let’s Sing of Our Pride in Being Under the Guidance of the General and, most intriguingly, It Is Offensive. This synchronised swimming, the KCNA advises, shows North Korea to be “dashing ahead like the wind toward the high peak of a great, prosperous and powerful nation under the guidance of Kim Jong-Il”. Who could argue with that?