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Chapter 14. Dire Consequences > Setting Back Technological Innovation

Setting Back Technological Innovation

One of the most significant consequences of the bubble was that in the rush for riches, many entrepreneurs were bypassed for funding who would have done a better job than those who were funded.

One significant example involves the laying of fiber optic cable under the oceans of the world. Global Crossing, a firm created by Gary Winnick, a Wall Street insider and a former associate of Michael Milkin, the junk bond king, crowded out firms with greater capability and promise. In the mid-1990s, as a need for more bandwidth to carry the Internet became evident, he hatched a scheme to lay fiber optic cable under the world's oceans. He had no experience in anything like this, but Wall Street quickly financed his company, and placed billions of debt for it. He took his company, Global Crossing, public in August 1998, at $9.50 a share, and a few months later it peaked at more than $60 a share.


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