Sinking shares turn yesterday's acquirer into today's acquiree. Falling values also render employee stock options — the ability to buy company shares at a predetermined price, hopefully much lower than where it trades — into a cruel joke. Worst of all, cheap shares cut off new supplies of cash that are needed if a money-losing company hopes ever to build a sustainable business. The latest example of an unwelcome dot-com is Altavista, which on Friday pulled a public debut scheduled for this week.
The stock prices of many of last year's dot-com darlings are down as much as ninety percent. The gyrations of the markets may seem like a distraction from day-to-day business, but that's not the case in the New Economy, where stock is the main currency for compensating staff and consolidating competitors.