The IABC Handbook of Organizational Communication: A Guide to Internal Communication, Public Relations, Marketing, and Leadership

Shaken Investor Confidence

The collapse among technology stocks following the NASDAQ stock market peak in March 2000 was the first in a number of troubling developments that shattered the confidence of investors. The technology stock implosion stemmed from a buildup of investor expectations that were not backed with financial results. Also uncovered was the unsettling practice of financial analysts who had publicly touted certain stocks but had concerns about those same investments. Adding to investor distrust was the recognition that analyst compensation was tied directly to business generated for their firm's investment bankers.

This represented just the initial wave of investor disappointment. There was more to come. Corporate malfeasance ...