“If’s Jeff Bezos were to found a religion, think of the following he might achieve.”

This quotation is from Marc Faber’s Dec. issue of “Gloom, Boom and Doom Report.” It occasioned a thought. Having announced the Twilight of the Internet Gods, it occurred to me that I should go back and look at them in the light of day.

I began to look at the Internet mania as a religious movement — rather than an investment phenomenon. In some ways, it makes more sense when viewed as a new religion.

A year or so ago, an item was widely circulated on the Internet. I can’t remember the source or the headline, but it read like a combination of the Desiderata, Communist Manifesto and Apostles’ Creed all wrapped into one. It was one of the most remarkably self-important pronouncements I have ever read.

It proclaimed a new world — the world of the Internet, in which the old rules were to be thrown out. This was to be a new, and much better world — much more civilized.

It reminded me of similar heavy-handed proclamations in the 1960s. Young people thought they were on to something back then, too. They put on funny clothes, spoke to each other in a strange jargon, and believed that their new culture was vastly superior to the old one — which they found contemptible.

When I received this message I didn’t know quite what to make of it. The confidence, conceit and arrogance of it was appalling. “Surely, God will strike down these people,” a little voice told me.

Instead, they have been lifted up. The Internet God has risen along with the Nasdaq. There are now millions of worshippers…. true believers, many of whom have seen proof of His Works in their portfolio statements.

You have only to look carefully at some of the Internet companies’ stock prices to understand that this is a market boosted by faith, not stock analysis. Investors have no reason to believe that Amazon will ever be profitable. But they have faith. It is the same kind of faith in the apparently impossible — the risen Lord, the Immaculate Conception, the transubstantiation of bread into the body of Christ — that animates Christianity.

The Internet faith is fairly new. It has not had thousands of years in which to refine and elaborate its doctrines. Yet, in just a short time, it has developed its own creed and moral code (no spamming!) There is even a creation myth — in which Al Gore claims to have formed up the Internet from the dust of Congressional appropriations.

And there is the idea — as in both Marxism and Scientology — of the “new man.” This new fellow is not supposed to act like the old brute. He’s supposed to be lifted up to a higher consciousness — where he behaves better, and develops a new culture in interactive communities.

The Internet religion has everything a religion needs. There are the prophets — such as George Gilder and Linus Thorvalds. There are the high priests — such as Mary Meeker and William Hamquist. There must be Internet martyrs too — though I can’t think of any. “If you don’t believe that the Internet will change everything,” writes Seth Godin, one of the disciples of the Internet Faith, in the introduction to his book, Permission Marketing, “you still need this book.”

And yet, as time goes on, it appears more and more likely that the Internet will change less and less.

I have been following a very interesting discussion in my own business. One of my partners has been trying to learn how to make money on the Internet. He’s begun a dialogue with someone who is net-savvy… and capable of arguing the True Believer position.

My partner is challenging the jargon of the Internet — trying to find out whether there is something really new in this medium. So far, the discussion has turned up nothing… The Internet may not be the One True God.

But I may have more on this subject. I have to run to a meeting…

Bill Bonner

Paris, France January 24, 2000

P.S. My aunt died last week. She had had a number of strokes… and was threatened with tubes and tests. She decided to check out before the torture began. We will hold funeral service in Lathus — officiated by an Anglican priest — tomorrow.

P.P.S. Winston Churchill died on this day in 1965.

*** One of my big predictions for the future is CONVERGENCE. Of course, that’s always my prediction — that things which are out of whack will somehow find their back into whack.

*** In particular, I’m betting that the Nasdaq and the Dow cannot continue to go their separate ways. Nor can Main Street and Wall Street live totally separate lives.

*** The trend towards convergence dominated the first week of January. But last week, the pattern of last year reasserted itself.

*** The Dow fell 99 points on Friday. There were 1313 advances. 1721 declines. 108 highs. 131 lows. And guess which way the Nasdaq went — up again, 47 points.

*** As it was on Friday, so it was for the entire week. 1337 stocks on the NYSE went up. 1739 went down. The Dow was down 4% for the week. But the Nasdaq went up 4.2%

*** Volume was very heavy on Friday. 1.9 billion shares changed hands on the Nasdaq. Amazon keeps going down. It was down to 62. Maybe it will buy something big — like UPS or Federal Express — thus converging with the Old Economy. That might put some life in it. Bezos better move soon, though.

*** Gold and oil were both up marginally on Friday. The Bank of England is auctioning off 25 tons of gold tomorrow.

*** The “Financial Times” reports that, more than ever before, corporations are beefing up their operational earnings by speculating on the stock market. Chase Manhattan earned 40% of its 4th quarter profits from its investments. Wells Fargo took in $650 million from venture capital plays. Microsoft traces two-thirds of its earnings growth to investments. And Delta made three times as much money in the 4th quarter by unloading shares as it did from flying airplanes.

*** Lost and found. Gen. Malofeyev, missing in action in Grozny since last Thursday, has been found. Dead.

*** “Everything is sliding along fine right now,” says Vera Sarasio, quoted in the “Financial Times,” “why not just let it slide.” Ms. Sarasio was explaining why she would not bother to vote in Iowa this evening.

*** No doubt, poor Ms. Sarasio will be seen as neglecting her duty as a citizen by the Good Government crowd. But I salute her for having the courage to say what everyone must think — voting in this Iowa poll is a waste of time.

*** Ms. Sarasio is content because so far the year 2000 seems to be going beautifully. Unemployment is at its lowest point in 30 years. Inflation hasn’t been this low in 35 years.

*** But the more you look at the inflation figures, the more suspicious you become. That latest doubt arises over a report cited by Bill King noting that the government statisticians are using geometric weighting in the CPI figures. If anything goes up in price, the quants assume that people switch to something else. So the item gets a lower weighting. And if an item goes down in price — computers, for example — it gets a higher weighting.

*** One million people demonstrated against ETA, the Basque separatist group, in Madrid over the weekend. The Basques are blamed for killing a Spanish military officer. The spirit of reconciliation has not yet caught on in Spain.

*** Apologies. It bothered me all weekend. It seems I have offended vast numbers of people. Gays, blacks, women, fat girls, ugly people, cripples, Russians, the Irish, internet stock buyers, Baltimoreans, half-wits, whole wits, and those with no wits whatsoever, Christians, politicians, Hillary Clinton, Al Sharpton, country music fans… did I leave anybody out? Well, I am feeling contrite. And, so, please accept this blanket apology. Heck, this is the New Era… I’ll make it an electric blanket… no an electronic blanket apology, programmed to turn on whenever my observations — intended, as they are, for your amusement and enrichment — leave you cold!

The Daily Reckoning