A Very English Deceit
The Secret History of the South Sea Bubbleand the First Great Financial Scandal
Malcolm Balen
Karen, Mischa and Katya
Contents
Even the Royal Family has joined the ranks of the dot-com investors hoping to make a fortune from Internet shares. Now it has emerged that the Queen has invested £100,000 in the Internet company getmapping.com. When it floats on the stock market next month, it’s expected to be valued at £40 million, so the Queen’s stake will be worth £1.2 million. But there’s growing concern about how successful investments in such stocks will be. An increasing number of City experts believe the Internet bubble will soon burst. Indeed many are comparing it with the first time a shares bubble fuelled by frenzied speculators burst.
Daily Mail, 20 March 2000
CHAPTER I
The Dome
It could be fair to describe what happened at the turn of the millennium as the Great Silicon Valley Swindle, a popular delusion that will take its place in economics textbooks alongside the Dutch Tulip Mania of the seventeenth century and the South Sea Bubble of the eighteenth. Investors appeared convinced that venture capitalists were capable of generating extraordinary returns on technology and consumer Internet companies. The effect