Nonresidential Fixed Investment in the DotCom Boom/Bust
What did we think was happening back then, compared to what we know now? Figure 1: Nonresidential fixed investment from 2001Q1 advance release (blue), from 2026Q2 2nd release (black), both in logs, 1999Q1=0. NBER defined peak to trough recession dates shaded gray. Source: BEA, NBER. To compare annualized growth rates, in 2000Q1, nonresidential fixed investment […]
The article "Nonresidential Fixed Investment in the DotCom Boom/Bust" explores the discrepancies between initial projections of nonresidential fixed investment growth during the dotcom boom and the actual growth rates observed over time. According to the 2001Q1 advance release, nonresidential fixed investment was experiencing a robust 19.1% annualized growth in 2000Q1.
However, by the latest vintage in 2026Q2, this growth rate had decreased to 14.4%, and currently stands at 8.2% in the 2026Q2 2nd release. This downward revision highlights the challenges in accurately forecasting economic trends, especially during periods of rapid technological change such as the dotcom boom. The article also compares these figures with GDPNow predictions, which indicate a 9.1% annualized growth rate for Q3, underscoring the need for caution and continuous revision in economic forecasting models.
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