the bubble bursts

I recently read Pop!: Why Bubbles Are Great For The Economy by Daniel Gross. In it, he talks about various bubbles in the past....like the dot.com bubble, the current sub-prime lending bubble, etc. Here is an interesting one:

The Tulip Craze During the 17th century, the Dutch went nuts for the tulip bulbs that had been first imported from Constantinople in 1559. By 1634, a single tulip bulb was being sold for the equivalent of $35,000 in today’s dollars. Four tulip bulbs would get you a handsome little house on one of the canals of Amsterdam. In a dizzying six-week period, tulip prices dropped to the equivalent of $1.00 and the Dutch economy took years to recover.

The book discusses how we buy into things, contrary to common sense and the pop is usually a correction that leads to a more healthy way of doing things. The unfortunate part is, the deeper you are invested in the bubble, the longer and more difficult the recovery.

Here is a bubble that my generation has "bought into":

We tend to think that in order to be successful, happy, healthy and on par with the world, we have to begin at the same level materially as previous generations and other peers are at. For instance, if our house, car, home theater is not as nice or better than our parents was and our what our friends have we are somehow missing out on life. Or if we aren't doing as many "productive" activities as everyone else and our kids aren't involved in everything that comes along, we are somehow missing out on life.

I think this sort of attitude helped lead to the sub-prime lending bubble and creates a difficult financial/emotional/spiritual bubble in our own lives. Eventually the thing will pop when we realize that some things are just not as important as others, we can't keep paying for things with money we don't have and we can't invest all our time in activities and still have time for meaningful relationships.

Hopefully, the bubble in your life willpop sooner rather than later, so your recovery will be quicker and smoother and you can do things at a healthier, more enjoyable and more meaningful pace.