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* Grant, James. 1996A. The Trouble with Prosperity, May  <!-- Grant, in his book The Trouble with Prosperity, written in May 1996, says: "Predictably, the risks to saving are the greatest just when they appear to be the smallest. By suppressing crises, the modern financial welfare state has inadvertently promoted speculation. Never before has a boom ended except in crisis." Grant continued to warn investors about the stock-market bubble in his investment newsletter, to provide detailed explanations of the cause of the bubble, and to chronicle the relevant statistics.<ref name="Thornton_Bubble" /> - anything more about that? Can't check the book; should check out the newsletter - Grant’s Interest Rate Observer. -->
* Grant, James. 1996A. The Trouble with Prosperity, May  <!-- Grant, in his book The Trouble with Prosperity, written in May 1996, says: "Predictably, the risks to saving are the greatest just when they appear to be the smallest. By suppressing crises, the modern financial welfare state has inadvertently promoted speculation. Never before has a boom ended except in crisis." Grant continued to warn investors about the stock-market bubble in his investment newsletter, to provide detailed explanations of the cause of the bubble, and to chronicle the relevant statistics.<ref name="Thornton_Bubble" /> - anything more about that? Can't check the book; should check out the newsletter - Grant’s Interest Rate Observer. -->


* Grant, James. 1996B [http://mises.org/journals/aen/aen16_4_1.asp The Trouble with Prosperity], Winter 1996, Interview <!-- general prediction with a little extra: "Before this is all over, there will be a big speculative upset, a loss of faith in financial assets, and a loss of faith in the steward of financial markets: Greenspan himself." -->
* Grant, James. 1996B [https://freecapitalists.org/journals/aen/ The Trouble with Prosperity], Winter 1996, Interview <!-- general prediction with a little extra: "Before this is all over, there will be a big speculative upset, a loss of faith in financial assets, and a loss of faith in the steward of financial markets: Greenspan himself." -->


* Hülsmann, Jörg G. 2000. Schöne neue Zeichengeldwelt <!-- can't verify <ref name="Thornton_Bubble" /> -->
* Hülsmann, Jörg G. 2000. Schöne neue Zeichengeldwelt <!-- can't verify <ref name="Thornton_Bubble" /> -->

Latest revision as of 04:21, 16 August 2026

See also: Austrian predictions

The Dot-com bubble and its bust was foreseen by several Austrian economists.[1] In October, 1999, Sean Corrigan pointed out a massive bubble and implied it will burst. He compared the conditions to those during the late summer of 1987, the Japanese bubble of the late 1980s, and the "roaring Twenties" in the United States. [2] In March, 2000, Christopher Mayer noted that all the ingredients of a bubble - fundamental (i.e., a technological revolution), financial (i.e., a surge in money and credit) and psychological (i.e., a suspension of belief in traditional valuation measures) - appear to exist in the current bull market and predicted it will end with a bust.[3] In August, 2000, William Anderson pointed to the bubble in the high-technology sector, mentioned the negative consequences of a regulatory attack at Microsoft[4] (which was analyzed a year earlier by Thomas DiLorenzo[5]). There were others.

Predictions

Anderson, 2000; Corrigan, 1999; Deden, 1999; DiLorenzo, 1999; Grant, 1996A, 1996B; Hülsmann, 2000; Mayer, 2000; Paul, 2000; Reisman, 1999; Sennholz, 2000; Shostak, 1999; Thornton, 2000.

  • Grant, James. 1996A. The Trouble with Prosperity, May
  • Hülsmann, Jörg G. 2000. Schöne neue Zeichengeldwelt


References

  1. ↑ Mark Thornton. "Who Predicted the Bubble? Who Predicted the Crash?" (pdf), The Independent Review, v. IX, n. 1, Summer 2004, ISSN 1086-1653, Copyright © 2004, pp. 5–30. Referenced 2011-12-13.
  2. ↑ Sean Corrigan. "Will the Bubble Pop?", Mises Daily, October 18, 1999. Referenced 2012-01-08.
  3. ↑ Christopher Mayer. "The Meaning of 'Over-Valued'", Mises Daily, March 30, 2000. Referenced 2011-12-13.
  4. ↑ William L. Anderson. "New Economy, Old Delusion", The Free market, August 2000, Volume 18, Number 8. Referenced 2012-01-08. Quote: "As things stand currently, the once-vaunted bull market is in flux. This is partly due to the government’s arrogance in believing it could attack Microsoft without harming other high-technology firms that have been the most visible in the current economic expansion. But even without the DOJ’s Microsoft follies, the high-technology sector of the economy faces real problems. First, the bubble that pushed so many of the "dot.com" initial offerings into the stratosphere had burst even before Reno’s pyrrhic victory. Second, the malinvestments as described by Ludwig von Mises and Murray Rothbard that occur as the result of wildly expansive monetary policies by the Fed have been centered in the high-technology sector. The growth of new money that is the signature of inflation can come only through the fractional-reserve banking system in the form of loans, which, as noted earlier, have found their way into high technologies, real estate, and the stock market."
  5. ↑ DiLorenzo, Thomas J. "Regulatory Sneak Attack.", Mises Daily, September 16, 1999. Referenced 2012-01-08.
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