After the immense prosperity of the 1990's (built on unrealistically inflated home prices), the bursting dot come bubble resulted from too much money flowing into too many unprofitable tech ventures. The climax of the dot come bubble in the stock market was hit in early 2000 on the shoulders of what Alan Greenspan accurately forecast as the era of irrational exuberance in asset values.

Overbought tech stocks plunged dramatically when speculative fever ran into a brick wall after the Federal Reserve enacted several rate increases and the historic Microsoft anti-trust case. As investors began to take a closer look at the actual value of some tech ventures, massive selling in major blue chips accelerated in March of 2000, leading to several successful panic selling sessions.

Internet stocks, which were perceived as get rich quick ventures, suffered the brunt of the bursting dot.com bubble. Many internet ventures went insolvent in the coming years, and the stock market spiraled lower on the expansive correction in tech stocks.

It is estimated that about $5 trillion in stock market value was eradicated from the beginning of the dot.com meltdown until late 2002. Despite the multitude of failures that resulted from the dot.com bubble, companies like Amazon and eBay emerged from the swamp and continue to be market leaders today.

Stock Market Crash of 2000 - Dot Com Bubble - Article By Better Trades