In 1985, investors went nuts over companies that sold merchandise on dedicated cable T.V. channels or through long infomercials on regular broadcast T.V. stations. The hottest stock in this group was the Home Shopping Network. Almost all the major brokerage firms were recommending it. In the end, all of these companies either went bankrupt or were bought up cheaply by large conglomerates. While a lot of people are too young to remember the T.V. home shopping bubble of the 1980s, many internet stock investors don't remember it simply because they don't want to.
History repeats itself.
In many ways, the arguments for buying internet stocks are eerily similar to the arguments for buying T.V. home shopping stocks in 1986. This became one his most frequently quoted lines in the 1930s. It was very good advice. Investors today have become so obsessed with making big bucks on Wall Street that many have completely forgotten about risk. Thats a bad sign - when investors aren't concerned about the risks of their investments and don't want to hear warnings or any negative news.