In 1637, a flower came to represent something far greater than a simple flower.
In the Netherlands, rare tulips began to carry status, exclusivity, and prestige. As prices rose, new buyers entered the market—not necessarily because they believed in the tulip’s value, but because they believed they could sell it later for an even higher price.
That’s where the real logic of a bubble begins.
The price goes up.
More people notice the rise.
Demand increases.
The surge seems to confirm the thesis.
New buyers enter.
And the cycle feeds itself.
The most dangerous detail is that, during the euphoria, the rising price appears to be proof by itself that the asset is worth more.
But price and value are not the same.
When the expectation of finding someone willing to pay more becomes the main reason to buy, the market stops looking only at the asset and begins to trade a narrative.
And narratives can grow much faster than reality.
Tulipomania lasted across centuries precisely because its mechanism is still current: desire, scarcity, expectation, euphoria, excess, and finally, reality.
Today’s “tulip” may not be a flower.
It could be any asset whose price is being supported more by the expectation of appreciation than by an understanding of its value.
The most important question is not:
“How high can this go?”
It’s:
“Why would someone be willing to pay more for this later?”
Because, when everyone depends on the existence of a next buyer, the risk is no longer only in the asset.
It’s in the crowd.
Which current market looks most like a bubble? Share your view.
#BolhaFinanceira
#mercados #Investimentos #VarejoInvestidor
$HIMSB
$RNDR $KITE
In the Netherlands, rare tulips began to carry status, exclusivity, and prestige. As prices rose, new buyers entered the market—not necessarily because they believed in the tulip’s value, but because they believed they could sell it later for an even higher price.
That’s where the real logic of a bubble begins.
The price goes up.
More people notice the rise.
Demand increases.
The surge seems to confirm the thesis.
New buyers enter.
And the cycle feeds itself.
The most dangerous detail is that, during the euphoria, the rising price appears to be proof by itself that the asset is worth more.
But price and value are not the same.
When the expectation of finding someone willing to pay more becomes the main reason to buy, the market stops looking only at the asset and begins to trade a narrative.
And narratives can grow much faster than reality.
Tulipomania lasted across centuries precisely because its mechanism is still current: desire, scarcity, expectation, euphoria, excess, and finally, reality.
Today’s “tulip” may not be a flower.
It could be any asset whose price is being supported more by the expectation of appreciation than by an understanding of its value.
The most important question is not:
“How high can this go?”
It’s:
“Why would someone be willing to pay more for this later?”
Because, when everyone depends on the existence of a next buyer, the risk is no longer only in the asset.
It’s in the crowd.
Which current market looks most like a bubble? Share your view.
#BolhaFinanceira
#mercados #Investimentos #VarejoInvestidor
$HIMSB
$RNDR $KITE