Bubble happiness

Who says bubbles are bad? Not Daniel Gross, financial columnist for Slate, who just published a pithy tome etitled Pop! Why Bubbles are Great for the Economy. The book doesn’t contain a word about art, but its conclusions are worthy of pondering. His message: sure, bubbles create a huge mess when they pop, but the energy and innovation they generate while they last is worth it. Here it is in a nutshell:

“[Besides,] if some omniscient Bureau of Management were tasked with the capacity to halt enthusiasms before they go out of control, we wouldn’t necessarily want it to do so. ‘I hold it, that a little rebellion, now and then, is a good thing, and as necessary in the political world as storms in the physical,’ Thomas Jefferson wrote to James Madison in 1787. In the economic realm, a little rebellion, now and then, is a good thing, too. And bubbles, entrepreneurial storms that disrupt the existing commercial order, provide shots of adrenaline. The enthusiasm they generate has led successive generations of entrepreneurs to open new territory for settlement, to create valuable new infrastructure, to spur innovation, and to push people to work, invest, and spend at a higher level—all in pursuit of promised massive short-term gains.” (p. 188)

Thoughts?

3 thoughts on “Bubble happiness”

  1. %-) I have to agree. In general I quite enjoy the occasional bout of irrational exuberance. It is just that when it exists in a market I care about I start to side with those who rail against; simply because it makes it more expensive to buy what I like!

  2. A bubble phase is a seller’s market, and as a result, buyers suffer.

    I am ready for a correction, especially if it brings prices back in line and deflates egos of those dealers who are so revved up on profits that they have become dismissive and condescending to buyers and well-intentioned art journalists.

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