Friday, 31 October 2008

Boom and Bust

Over the past year and a half my Internet activity has followed the same general cycle as the stock market. Both rose progressively to greater and greater heights, finally reaching an unsustainable peak - and then rapidly dropped down to a fraction of their former levels.

The collapse of my personal investment of time in the Internet only took a few weeks, whereas the stock market has been plunging steadily since January 2008. The loss of stock value did accelerate in the month of October, but it now seems to have levelled off.

Despite minor differences, these two boom-and-bust cycles share a common principle: there comes a point at which accumulated value must be destroyed in order to allow new growth.

My Internet Boom

My cycle of intense internet activity began in early 2007, when I firmly decided to create my own website. By late Spring I had installed about 3 or 4 sites, only to discover that no one looked at any of them.

So I began studying Search Engine Optimization, in an unsuccessful attempt to draw visitors. In the Autumn of 2007 I realized that I could reach a far larger audience by editing articles on Wikipedia. But I soon got bogged down in Wikipedia edit wars.

Then in late November of 2007 I discovered Second Life, and Danton Sideways was born. In December I joined the Confederation of Democratic Simulators (CDS), which was my first true Internet community. I started the present blog, where I recorded my progressive discovery of the virtual world of Second Life. I began attending meetings of the Citizen's Social Democratic Faction, which is one of the CDS political parties, and I also sat in on the weekly meetings of the CDS Representative Assembly.

By early 2008 the Internet was taking up vast portions of my time. I started following several Second Life bloggers, including notably Prokofy Neva, who writes very long daily posts. Through Prokofy I discovered Twitter, which consumed additional large daily chunks of time. Through other Twitter users I discovered
Plurk, which is still more time-consuming than Twitter. Meanwhile I began to get involved in OpenSim, and even started my own OpenSim blog.

My Internet Bust

By the beginning of Summer 2008 my situation had become unmanageable. I was spending every free minute I had in front of the computer, and it was still not enough. In late July I took my family on vacation in Italy, where I stayed online thanks to my Asus 3e netbook. But once back home I realized that I was completely overextended, and needed to cut back.

So I started pulling out of my various Internet activities, gradually at first, and then with increasing speed. At the top of my cycle I had at one point stumbled on a video about screen addiction, starring a cartoon character who comes up for air in "real life." That is what it felt like. It was as if I came back among the living.

I posted my last article on this blog (before the present post) on August 11th. I made my last Plurk on August 24th. On September 8th I sent an email to my friends in CSDF, announcing that I was reducing my time in Second Life. I made my last tweet on Twitter on September 18th.

From there on, my activity on the Internet (other than a bit of normal googling and emailing) dropped to virtually zero.

The Great Stock Market Bust of 2008

As chance would have it, my personal Internet bust coincided closely with the great stock market crash of October 2008. The stock market drop of 2008 is in reality no greater than that of 2002-2003, as can be seen by a glance at a historical chart of the Dow Jones average. But October 2008 saw something much worse: a worldwide financial crisis, following the huge U.S. housing price crash. Alan Greenspan calls it a "once in a century credit tsunami."

After having studied this crash on the Internet for a few weeks, I'm convinced that it is the equivalent of that of 1929, and that we are entering a period of extended deflation which will be the equivalent of the Great Depression. I expressed this opinion, for example, in a comment on one of the blogs devoted to the Kondratieff Cycle.

New Growth

That we may be on the verge of a new Great Depression is just a hypothesis. What remains true is that periods of reduced activity serve a very important function: they permit new healthy growth to begin. Thus the economist Schumpeter talked of creative destruction, in the sense that accumulated value must be cleared away in order that new value may be produced.

In my own case, much of my Internet activity had carried me far from my original aims, and had become an end in itself. By severely cutting back, I gained space to reflect upon what I really want to do, which is (as always) to promote the development of convivial tools.

So I am coming back online, timidly and cautiously, to work on my personal projects. At the rate of maybe a few hours per week - instead of 24 hours per day.


Prokofy said...

I don't understand the extremes to which you go regarding Internet time. Oh, wait a minute, maybe I do, given your socialist views.

Trumpeting Schumpeter -- meh, you and Mary Caldor. Who gets to decide what is "creatively" destructive? Why is it always other people's systems, ideas, ways, etc that need "clearing away"? It's just the usual violent utopianism. It's so Hegelian. Why must "something be destroyed" for "something to be born"? It's a silly and primitive idea.

Danton Sideways said...

Actually, Prokofy, I think it is very sad that so many people have lost their savings, their homes and/or their retirement income. I should have said so in the post.

As for Schumpeter's "creative destruction," it just harkens back to one of the basic tenets of capitalism: free enterprise allows dynamic new ways to doing things to displace - hence to destroy - older and less efficient ways of doing things. I personally would be the last to champion "efficiency" above human or ecological values, but economics as a science tries to describe what is, rather than what should be.

This capitalistic process of constant change was just getting underway in Hegel's day, and his "dialectic" can be seen as a philosophical expression of that capitalistic process. Nowadays the utopian alternative looks instead to a "steady state," which is pretty much the opposite of a "dialectic."

But all such concepts are simplications, and reality is always complex...