No Bubble?

Review the following paper:

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An excerpt:

“On March 10, 2000, the Nasdaq Composite Index closed at its all-time high of 5,048.62. For comparison, the same index stood at 1,114 in August 1996 as well as in October 2002. The unusual rise and fall in the prices of technology stocks has led many academics and practitioners to describe the event as a stock price “bubble.” This label seems appropriate if the term “bubble” is interpreted as an ex post description of an extended rise in prices followed by a sharp fall. However, a more common interpretation is that the prices of technology stocks exceeded their fundamental values in the late 1990s. This paper analyzes whether technology stocks were indeed overvalued at that time.”

The bottom line is the market went straight up to around 5000 and then straight back down. You either made money or not. Attempting, in hindsight, to explain whether it was a bubble or not, doesn’t seem to help explain how one would have traded that market — for profit.