RE: Is Bitcoin A (Tulip) Bubble? History's Most Exaggerated Non-Bubble (Even Tulip's Weren't Tulips)
My whole point here is that the entire Tulip situation was over-stated.
Wikipedia is not an acceptable sole-source when specifically discussing matters accused of being incorrectly hyped up in history. It will have exactly the same faults. You need more primary sources. Preferably, not Dutch Calvinists.
"there was an offer"
You can't price markets by offers. Offers are not a trade. Hell, you shouldn't even price them by a single trade.
"“There weren’t that many people involved and the economic repercussions were pretty minor,” Goldgar says."
...
"So if tulipmania wasn’t actually a calamity, why was it made out to be one? We have tetchy Christian moralists to blame for that. With great wealth comes great social anxiety, or as historian Simon Schama writes in The Embarrassment of Riches: An Interpretation of Dutch Culture in the Golden Age, “The prodigious quality of their success went to their heads, but it also made them a bit queasy.” All the outlandish stories of economic ruin, of an innocent sailor thrown in prison for eating a tulip bulb, of chimney sweeps wading into the market in hopes of striking it rich—those come from propaganda pamphlets published by Dutch Calvinists worried that the tulip-propelled consumerism boom would lead to societal decay. Their insistence that such great wealth was ungodly has even stayed with us to this day."
https://www.smithsonianmag.com/history/there-never-was-real-tulip-fever-180964915/
I don't know if I should trust such an US-imperialist free-market propaganda institution like the Smithsonian;-)
Ah, well, you may have a point there. I mostly just use them for the minerals section of the Natural History Museum. Perhaps they are a biased source as well.
It's probably both relatively true.
Looking at the size of the bubble compared to the general wealth and economic situation it must have been huge, especially since it was a new mass phenomenon. But then again, one must never forget that money is switching hands despite the price break-down and while one half loses everything, the other wins everything.
Economics is all about capital flow and trust and the repercussions of such a bursting bubble are the more severe, the less the winners of the burst trust the economy, because they hold their capital back from changing hands. If - and I guess this was the case in the Netherlands - the trust is high and the winners of the situation have confidence into the future, they simply reinvest the money they've just won in the bubble lottery. Then, the economic consequences are maybe visible, but limited.
My guess would be that the tulips have been traded between professionals who didn't take their gains and ran, but acted professionally and reinvested. I would say that if it had been a market driven by amateurs, it might have ended with more damage.
Ultimately, much like the current market cap of cryptocurrencies, the "market cap" of tulips was probably grossly overexaggerated by ignoring the effects of the order book vs. peak price:
https://steemit.com/taxes/@lexiconical/valuing-steem-rewards-as-taxable-income-is-a-vast-overstatement-of-tax-liability-part-2-the-thin-order-book-and-flash-crashes