Worry that I am writing this article for iMedia.

No, I am not going to impart you with any mystical knowledge, nor am I arrogant enough to think I would have any. However, the fact that there is general buzz and concern about the concept of a new internet bubble does have consequences. It can precipitate groupthink actions that cause the predicted fear in a self-fulfilling prophecy.

• Action: Concerned investors are fearful that the U.S. market is over inflated, so investors switch investments and invest overseas to balance portfolios.
• Result: Investors pulling out of riskier investments in the U.S. and deflate stocks of U.S. internet companies.
• Cascade action: Venture capital firms decide not to invest in the third round of funding for startups due to reduced investment capital at their disposal from the firms they have already taken public.
• Cascade result: web 2.0 companies -- expecting to receive that funding -- fail to meet their goals, close their doors and people become unemployed.

In other instances, the association with a failing company or the perception of wrongdoing causes groupthink actions, or the Arthur Andersen effect. Many people are unaware that they were cleared of wrongdoing in the Enron debacle. However, the perceptive damage had already been done. A change in perception, if adopted en masse, can cause the collapse.

(This is) even more precipitous for internet companies since many do not have capital equipment that has tangible value. The upside is a faster potential rise due to fewer financial anchors, but also increased potential for a precipitous decline.