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The public confidence crisis dejour – throughout time, market segments have experienced a crowd mindset. The more excited a market becomes, the more individuals want to jump in, and the higher the prices are pushed up.

This mindset has occured throughout history and the cycles can be studied consistently. Professor G. Watson teaches corporate ethics and the role of the market economy. Regardless of whether we want to think about recent real estate markets which have Pop, these fluctuations are not original. They have routinely occurred throughout time.

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

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

This industry mania continued – and ten years later the value had risen another ten fold. At the market peak, the value of a single Semper Augustus tulip bulb reached 10,000 florins – the equivalent of what it cost to acquire a house in the middle of Amsterdam at the time.

With time the market peaked and there was no-one left who still wanted to buy these bulbs at such high valuations. Within weeks, the market price crashed and thousands of people were left in financial ruin.

Throughout history – we have witnessed similar bubbles develop. As the crowd continues to get more excited, those contrary voices become less and less popular to be heard. Are any of the recent market bubbles any different? In modern environment of politically correct speech, are the contrarian voices that speak up for morality, ethics, and integrity 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 always correcting itself from the heat of the crowd – and those politically correct views tend to have their bubbles burst as the inevitable correction occurs. Today’s market is no different.