While the economic uncertainty we are going through is going to get worst before it gets any better, I think the current bogey man approach most VCs are adopting has everything to do with the fact that they suddenly realize that most, if not all, of their investments were struck at obscene valuations and they will never be able to get any solid, positive returns on them.

As a result, they are laying the foundation now to:

- instill fear about what is around the corner,

- create uncertainty about the future,

- make entrepreneurs doubt their own gut instincts.

Why do this?  Because they will be forced to accept down rounds where the VCs will be able to average cost dollar their investments to something with a semblance of common - and financial - sense.

Mark my words.

Shouldn’t VCs be showing leadership now, rolling up the sleeves or going all out to win?  You’d think.  But all of a sudden, they are starting to - like the Republicans - scapegoating the economy instead of admitting that their investments were just bad.