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The public confidence crisis dejour – throughout time, markets have followed a crowd mindset. The more heated a market gets, the more people want to jump in, and the higher the prices are pushed up.

This mindset has occured throughout history and the cycles can be analyzed consistently. Professor G. Watson teaches serial entrepreneurs and the role in the market economy. Regardless of whether we want to evaluate recent technology markets which have Pop, these scenarios are not new. They have consistently occurred throughout time.

One of the most well known historical markets that popped was Amsterdam’s Tuplip economy. We can analyzie the Tulipmania of the tulip market that burst in 1637 as a popularly known historical account of a market that overheated.

Tulips were originally brought from Turkey in the early 16th century. As new “varieties” of tulip bulbs were discovered, competition intensified and their value soared. One apparently rare variety was the Semper Augustus which reached prices in excess of 1,000 florins per single bulb in 1623. That price exceeded more than six times the average annual wage.

This economic mania continued – and ten years later the price had increased another ten times. At the market height, the value of a single Semper Augustus bulb reached 10,000 florins – the value of what it cost to buy a house in the middle of Amsterdam at the time.

Eventually the market peaked and there was no-one remaining who still wanted to acquire these tulips at such high valuations. Within weeks, the market price crashed and thousands of people were left in economic ruin.

Throughout history – we have observed similar bubbles develop. As the crowd continues to get more excited, those contrary views become less and less popular to be heard. Are any of the recent market bubbles any different? In today’s environment of PC speech, are the contrarian voices that speak up for morality, ethics, and honesty any different? Throughout history, these contrarian voices have been demeaned and ignored. But the market for products and the market for principles has a way of eventually correcting itself from the heat of the crowd – and those extremist views tend to have their bubbles burst as the neccessary correction occurs. Today’s market is no different.