No, tulips don’t spread Covid. This one is about how human stupidity is generating similar patterns all the time.
In the 1630s, during the Dutch Golden Age, tulips were all the rage in the Netherlands. Tulip bulbs, and also derivative contracts on these, were traded with increasing intensity. Prices rose to incredible levels – until the whole business collapsed in 1637. The tulip mania has often served as an early example of a bursting economic bubble. Nowadays (at least that is my interpretation of the Wikipedia article) people seem eager to try to rationalize the mania away. I am not in a position to judge this but I found the pattern of tulip price indices intriguing. Here’s one visualization that you can buy as a poster, annotated with economists’ jargon (no, I can not vouch for accuracy, and no, I won’t profit if you buy one):
Basically, the story unfolds over a period of three years. In the “awareness phase”, prices increase a bit (almost doubling) but then decrease again. The mania phase leads to a small plateau, and then a crazy mountain with steep slopes appears, with some strange dent (“bull trap”) at the top. When it’s all over, prices are elevated a bit above pre-crisis level.
Fast forward to 2007, when “the financial crisis” hit. Here’s a diagram showing credit spreads (the premium that companies, in this case BBB-rated banks, have to pay when borrowing money) for the years 2007 to 2009:
Not much is visible in the 2007 data although this was the year of the subprime crisis that led to the default or near-default of many financial institutions (like the German IKB). A new plateau was only reached in 2008, and with the default of Lehman Brothers (on Sep 15, 2008) and others (e.g., the three large Icelandic banks) the mountain emerged. Even the dent is there! Again, post-crisis credit spread levels are elevated.
And then there is Covid, as measured by the daily new confirmed cases. In honour of the tulip lovers, here’s three years of data for the Netherlands:
The first wave is almost invisible, the plateau spans over quite some time, the Omicron mountain is incredibly steep, the dent is deep, and Covid is going to be with us forever (only the Dutch seem to have stopped the crazy testing).
Unrelated as they might seem, all these episodes are telling us something, and something similar at that, about us human beings. And even remembering them all will not prevent me, and others, from falling into the same traps again.
Borges would have loved your story, more so if he could see the charts.
Strangely, knowing that we'll keep falling in the same traps for eternity comforts some of us. At least some parts of what we are do not wither away.