8 BARRON’S March 16, 2020
Verizon Communications(VZ), which
also absorbed the AOL platform. Sun Mi-
crosystems was taken over byOracle
(ORCL) in 2010, while EMC was acquired
byDell Technologies(DELL) in 2016.
Other Nasdaq numbers that soared in
the bubble never returned to their previ-
ous glory, even though they’re still around.
Sirius XM Holdings(SIRI) had a nega-
tive total return of 88.83% in the two de-
cades ended March 10, the worst perfor-
mance among the Nasdaq-100, according
to Bloomberg. NetApp (NTAP) had a nega-
tive 57.59% return, followed byIncyte
(INCY) with minus 26.88% over the same
span. Fourth worst wasCisco Systems
(CSCO)—the No. 2 Nasdaq company 20
years ago, in terms of market capitaliza-
tion, and the blue chipof internetstocks—
with a negative 24.09% total return, in-
cluding dividends.
The top Nasdaq name of 2000,Micro-
soft(MSFT), is now neck and neck with
Apple(AAPL) for the lead market-cap
position. Most of its 395.57% two-decade
total return was scored in the past few
years, after a long period of lackluster per-
formance.Intel(INTC), the No. 3 Nasdaq
stock in 2000, returned a wan 40.15%
over the ensuing two decades, while Ora-
cle, No. 4 back then (and now traded on
the NYSE), returned 64.93%, with divi-
dends rather than price increases generat-
ing most of both stocks’ gains.
The biggest Nasdaq winner from 20
years ago wasMonster Beverage
(MNST), with a high-energy total return of
74,588%, followed byO’Reilly Automo-
tive(ORLY), with 7,770.4%. The biggest
tech winner wasAnsys(ANSS), with a
7,381.47% return, followed by Apple, with
7,220.39%.
As Dan sagely observed in compiling
these records, many of today’s biggest tech
winners either weren’t public in 2000 or
didn’t exist.Alphabet(GOOGL) was begin-
ning to dominate the internet, but it didn’t
have its initial public offering until 2004.
Facebook(FB) launched its social media
site in 2004 and had its IPO in 2012.
Hubris can be dangerous. Companies
on top don’t necessarily stay there, with
the new, new thing ready to supplant
them, especially in tech. My recollection of
the bubble era was a loudmouth on my
commuter train bragging that his Sun Mi-
crosystems stock had split again, around
its peak. “Life is gooood,” he blared on his
cellphone. “Sic transit gloria” remains as
true as ever.B
email: [email protected]
guesses for the second quarter call for a
mild contraction of 1% to 2%, far less than
what the profound changes in Americans’
lives imply (although the insane panic buy-
ing of toilet paper alone could add to
GDP). Then they predict a gradual recov-
ery, ramping up as the warm weather lets
the virus pass. We’ll see.
In the absence of significant fiscal ac-
tion, all eyes again fall on the Fed. This
past week, the central bank sharply
ramped up its liquidity provision to offset
severe dislocations in the Treasury market.
These supposedly risk-free assets failed to
provide a cushion against riskier corporate
equity and debt securities as liquidity
dried up.
Futures markets expect the central
bank to slash its federal-funds policy rate
another full percentage point, back to the
crisis level of 0% to 0.25%, on Wednesday,
at the conclusion of its policy meeting.
With monetary policy near its limit, fiscal
actions beyond what have already been
announced seem necessary to counter the
likely effects of the big changes in how we
work and live during the pandemic. But
zero interest rates hardly seem the cure for
a pandemic.
T
his past week’s market plunge
obscured the 20th anniversary
of another major market event,
the peak of the Nasdaq tech bub-
ble on March 10, 2000.
That was supposed a once-in-a-millen-
nium moment of madness, never to be
repeated after the bitter lessons of bidding
up internet wunderkinds lacking earnings
or, in some cases, even much revenues, just
“eyeballs” looking at their sites. This past
year saw the ascent of the likes ofTesla
(ticker: TSLA) andVirgin Galactic Hold-
ings(SPCE). At least the electric-auto pio-
neer wisely took advantage of its stock’s
nearly fivefold increase from last May to
raise $2 billion in fresh equity near its Feb-
ruary peak to shore up its balance sheet
and ensure its long-term financial viability.
Some of the biggest names of the class
of 2000 no doubt wish they had been
equally prescient. With the help of our
researcher extraordinaire, Dan Lam, we
found that some of the names that loomed
large in the Nasdaq-100 index remain, but
as mere shadows of their former selves,
such as AOL, which merged with Time
Warner in what may be the worst deal in
corporate history. Yahoo! became Altaba,
with stakes inAlibaba Group Holding
(BABA) andYahoo! Japan(YAHOF),
while Yahoo!’s internet assets were sold to
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