Oil Shock - a barrel of Texas Tea sold for over $135 on Thursday.

Gas Shock - it cost me $80 to fill my 17 gallon tank this week.

Milk Shock - at $4 a gallon, it cost almost as much to put milk on my cereal as gas in my car.

Housing Shock - median home values have fallen over 10% in past year.

Bank Shock - banks don't want to lend you money, lend your company money, or even lend other banks money.

Big Daddy Bernanke, after dropping the discount rate 325 basis points since last September to 2%, said he does help out and with 4% inflation, we are going to figure it out for ourselves.

Any questions on why consumer confidence is at 28 year lows?

Stocks, which had been acting well since mid March in spite of all the negative noise, finally succumbed this week. The ThinkGrowth Index was off 4%, the worst of all U.S. Indices we track, followed by the Dow down 3.9%. The NASDAQ was off 3.3% and the S&P 500 down 3.5%.

Looking internationally, and we increasingly are seeing the greatest opportunities internationally, stocks fared equally poorly. Singapore was the worst off 6.6%, followed by India and China down, 4.5% and 4.2%, respectively. As another case study for why it's always good to challenge conventional wisdom, Chinese stocks, which the smart guys said would surge into the Beijing Olympics, are off 34% for the year.

While it's definitely a scary time in the world with all the aforementioned problems, if "it's in the papers it's in the price." Moreover, the energy problems that have EVERYBODY concerned will accelerate the development of green technology as alternative to dirty, expensive, and out of our control foreign oil - that's great long-term news.

Additionally, if we quit focusing on the trees that keep falling on our heads, the environment for innovation and growth is breathtaking. At our ThinkTomorrow~Today conference last week in Half Moon Bay, it was amazing to see what is going on in growth sectors such as green technology, education and the Internet.

In August, it will be 13 years since Netscape went public, but when you see the entrepreneurial activity that is taking place, it is maybe the second or third inning for the Web's development.

When RCA's David Sarnoff introduced television sets at the World's Fair in New York in 1939, people knew it was the beginning of something big, but the early applications were to take what was previously done on the old medium - radio - and put it on the new medium - TV. Families would sit around and watch announcers in front of a microphone (like Don Imus and Howard Stern today!).

The bridge to a new medium almost always starts by taking the old material and processes and transferring them to the new medium. Accordingly, the first phase of the internet, Web 1.0, was dominated by businesses that tried to put everything and anything on this exciting new medium and companies that created a connection to the net.

Yahoo!'s (NASDAQ: YHOO, $27.72) early days were basically putting a yellow pages online. Banner ads swarmed static websites. Then brick and mortar businesses began webifying themselves. Netscape was the "on-ramp" to the superhighway and AOL helped non-techies get online.

Like going from radio to TV, this new medium was breathtakingly exciting, almost magic, but few people had re-conceptualized the true power of the Internet and how new models would emerge to change the game.

"Web 2.0," coined by Dale Dougherty and Tim O'Reilly, is that following the dot.com crash, far from being dead, the web became even more important than before. The companies that survived the nuclear winter were thriving and creating exciting new applications like Wikipedia.

The key principle behind Web 2.0 is that the internet has emerged as the fundamental global platform for communication, commerce, information, services, and product development.

Microsoft (NASDAQ: MSFT, $28.05) illustrated the power of a platform with its pre-Web 2.0 era dominance thanks to the Windows operating system. It brilliantly (and arguably unfairly) used its dominant position to bury peripheral competing products to its application suite in order to squash the competition. Despite having a better product than any of those that Microsoft offered, Lotus 1.2.3, Word Perfect, and Netscape Navigator were all crushed by Microsoft's better business model. Aces beat Jacks and platforms beat products.

The second key concept of Web 2.0 is to tap into the collective intelligence of the web. In James Surowiecki's excellent book, The Wisdom of Crowds, he provided compelling examples of how the collective intelligence of many is much more powerful than the opinion of even the smartest individual.

Creating a network effect and leveraging the collective intelligence of the World Wide Web is at the core of many of today's most powerful business opportunities.

Google (NASDAQ: GOOG, $544.62) is unquestionably the poster boy for Web 2.0 and has established itself as the platform to beat. Search is where it all begins and Google is at "First and Main." Gmail, Google Earth, Google Docs, Froogle, Orkut, and Google News are all strategic in expanding and enhancing its leadership position.

Google's algorithm is made better by more users; ditto for eBay (NASDAQ: EBAY, $30.18) and Amazon (NASDAQ: AMZN, $78.35).

ThinkPanmure was the first Wall Street firm to have a blog (www.thinkpanmure.com/blog). Tapping into the collective intelligence of investors in a specific sector or company is extremely powerful and could radically change the way Wall Street research is coordinated.

The reason Zagats in NYC is so amazingly on-target is it has 100,000 people contributing to the opinions it publishes. Wikipedia is a wildly successful online encyclopedia written and anyone who wants to edit it. Imagine how that model can be applied to stocks.

The key principles of Web 2.0 are:
1. Web is a platform
2. Collective Intelligence
3. Database Management
4. End of Software Release Cycles

As it turns out, John Doerr was right - the web was underhyped!

Last week, at the ThinkTomorrow~Today (TTT) private company and venture capital summit, ThinkPanmure hosted presentations from 20 of the fastest-growing private Internet companies. My partner Bill Morrison who is the senior Internet analyst had a lot of observations. Some key observations are:

We continue to believe that, with the notable exceptions of Google, Bankrate, eHealth, and comScore, private companies are powering most of the growth and innovation in the Internet media market, solidifying our fundamentally bearish stance on the majority of publicly-traded Web 1.0 advertising models. A quarter of the companies that presented at TTT are generating revenue in the $50-100M range and growing 25-50% Y/Y, with several others in the $10-20M range and growing 100-200% Y/Y. (This version of the Media Industry report replaces the versions published earlier today. Page 11 now begins with EveryZing.)

We came away from the conference more convinced that Internet and digital media innovation and growth is almost the exclusive purview of private Internet companies (with notable exceptions including Google, eHealth, Bankrate, comScore and, to a lesser extent, Yahoo!, through its work in the display ad platform space). If public investors are occasionally puzzled by the disconnect between a rapidly-growing Internet ad market and anemic growth among Web 1.0 media and advertising models, the explanation can probably be found in the very strong growth rates of private Internet companies like those that participated in ThinkTomorrow~Today. It is becoming increasingly clear to us that the leading private Internet companies are capturing significant market share from their public company brethren.

The program at TTT included presentations from 80 high-growth private companies within several growth areas of the economy including GreenTech, Consumer, Business Services, Software, Networking, and Internet. Internet and digital media companies presenting last week included Boxee, BzzAgent, CelebTV, Cobalt Group, ContextWeb, Education.com, Everyzing, Friendster, Glam Media, Imeem, LinkedIn, NebuAd, OpenX, ReachLocal, Trulia, Vibrant Media, VideoEgg, and Whitepages.com. To read Bill Morrison's complete note, please click on the following link: (link) PDF

This week, price action signaled a market correction and while we don't know how long this will last, we look at it as an opportunity to purchase shares of companies with the strongest fundamentals and growth potential. Moreover, in a world where growth is scarce, companies with strong growth fundamentals should get premium investor's attention.