Is the bubble bursting? I can't answer that with certainty but every day it seems clearer that what experts first considered a "correction" is now looking more like a global collapse. The second question: are the Web 2.0 bubble and the subprime bubble related? Yes, they are. In fact, the so-called "subprime bubble" is a misleading term. It's definitely a bubble but it's not restricted to subprime mortgages. It's a much wider crisis.
The cause of this
crisis is low interest rates that were kept far too low for far too long
When money is pouring almost freely, various ephemeral and overhyped initiatives bloom, lulling innocent people into believing that there really is a new business model that defies the well-known rules of economy. Web 2.0 is an exemplary case. When stupid venture capital stops flowing into Web 2.0 nonsense (that's going to happen sooner than many people believe), the Web 2.0 bubble will burst.
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