The new media technologies that began to assert themselves in the 1990s – the Internet, networked computers, and the other hardware and software that make possible the new media – have captivated both the investment community and the general public like nothing else in the memory of most people alive today. These new information technologies are changing the way we live, work, think, and make our day-to-day decisions. To the surprise of many, including economists, they have already led to large increases in productivity and the sustainable rate of economic growth of the US and other economies. By unleashing new forms of economic competition, they have also put a damper on inflation. They will continue to do these positive things for a good long time. Life as we know it will change in irreversible ways. Nonetheless, the reaction of the financial system to new media technologies is providing clear signals of ‘irrational exuberance’.