How the Economy Affects the Development of Nanotechnology

WELL, it does; plenty!

It's silly to think that companies and labs and startups grow in a vacuum. While the 1990 Painted Cave fires in Santa Barbara (more than 900 homes burned to the ground, including those of 11 close friends) proved to me that disaster can act as a boost to the economy (contractors were in hog-heaven and my friends built brand new, tricked out 5,000 sq foot modern palaces where their 1,700 sq foot 40 yr old ramblers once stood), largely this was due to the fact that mostly (only?) insured (even household effects and living expenses while re-building), single family dwellings were destroyed.

Katrina and Rita not only destroyed businesses but rental properties. What do you say to a typical (read, not independently wealthy) landlord with a couple of 12 unit apartments when the mortgage payment is due and he or she has no tenants? . . . no, none, nada tenants.

A slowdown or mild recession starting sometime in the next 3-9 months will hurl already cash-starved small technology startups toward the abyss, and forget about IPOs. VCs and bankers don't want to hear it, and they are kindly, optimistic folks on the whole, but we are teetering towards the stagflation of the late 1970s (see 1980/81 recession) culminating in what I like to call "the day Paul Volcker saved the world" in mid-1982. It's deja vu all over again, and this is a movie you don't even want to rent.

I think we'll see something much milder, say a slowdown/recession between the normal one in 1990/1 and the super-mild one in 2001/2. But, that said, I think you should count on it. Not close to the end of the world, but bad enough to cost investors, speculators and nanotech companies cash and time.