The financial crisis dejour – throughout history, markets have followed a crowd mindset. The more heated a market gets, the more people want to invest, and the higher the prices are driven.

This social experience has occured throughout history and the cycles can be studied consistently. Professor Watson teaches entrepreneurial marketing and the role of the market economy. Regardless of whether we want to evaluate recent real estate markets which have Burst, these scenarios are not new. They have regularly occurred throughout history.

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

Tulips were originally introduced from Turkey in the early 16th century. As new “varieties” of tulip bulbs were sold, competition intensified and their value soared. One honestly 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 wage.

This market mania continued – and ten years later the price had increased another ten fold. At the market height, the value of a single Semper Augustus bulb reached 10,000 florins – the value 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 tulips at such high valuations. Within months, the market value crashed and many of people were left in financial ruin.

Throughout history – we have witnessed similar bubbles reoccur. As the crowd mentality 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 politically correct speech, are the contrarian voices that stand up for morality, ethics, and integrity any different? Throughout time, these contrarian voices have been denigrated and ignored. But the market for products and the market for ideas 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 required correction occurs. Today’s market is no different.