$4 Trillion in market cap gone

There is a great post that helps concretize the lost value over the past year at TechCrunch: The Mess on Wall Street Four Trillion Dollars Down the Drain.

Where did this money go though?  It didn’t all just vanish.  Yes, some is the result of people simply buying for less, but they didn’t buy it for $0.  Some of it flowed into other capital markets where investors thought it was better spent.

This capital retraction will also affect IT spending as pointed out by Valleywag.  Ironically, this is the very time that the finance sector should be bullish on IT investment, but I am willing to believe they in fact will not be.

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