The bubbles that built America

These six bubbles - from the telegraph to the real-estate boom - show how Americans end up better off after a bubble, says the author of "Pop! Why bubbles are great for the economy" (Harper Collins).

Alternative energy
Venture capitalist Vinod Khosla is one of many Silicon Valley stars who have shifted their attention from the Internet to the next New, New Thing: alternative energy.
Alternative energy
Today, amid concerns over global warming and the rising price of oil, alternative energy is emerging as the next potential bubble. As in prior episodes, government policy is playing a significant role in encouraging private investors to take a fling on an untested sector. Federal subsidies for ethanol production, and state measures that call for significant growth in alternative energy supplies are providing crucial incentives.

Ironically, many of the same entrepreneurs and venture capitalists involved in the dot-com bubble are now backing alternative energy companies. Bill Gross, the visionary behind Internet incubator Idealab! founded Energy Innovations, which builds commercial solar energy grids. Ray Lane, the former Oracle executive turned venture capitalist, says: "This is bigger than the Internet, I think by an order of magnitude."

Evangelists are claiming that alternative energy start-ups, which will address limitless markets, can change the world, and save the planet - all while making investors rich beyond belief. By spreading environmentally-friendly technology, and by generating investor interest in cleaner sources of energy, this bubble could wind up being the most beneficial of all.

The telegraph

The railroad

The 1920s

The Internet

Real estate

Alternative energy

POP
Fortune's Adam Lashinsky explores why Silicon Valley's premier VCs have that old-time eco-religion. (more)
Robert Shiller called the tech-stock crash just as the Nasdaq peaked. But he is also the expert on the real estate market. And where does he think it's headed now? Uh-oh. (more)

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.