In any event, given this optimism and the attendant rise in earnings forecasts and the stock market, together with good fundamentals in terms of high demand, falling equipment prices, and moderate financing costs, the late-nineties boom in investment is perhaps not so difficult to understand.
The Investment Bust of 2000-02 In the second half of 2000, business fixed investment began to decline markedly; between the third quarter of 2000 and the third quarter of last year, the level of real investment outlays declined 12 percent. The drop in investment in computer and communications equipment was particularly sharp.