Are class B apartments like tulips?
388 years ago today this Amsterdam tavern convo was the NMHC conference of its time.
Tulip Buyer (Johan):
I hear you have a Semper Augustus bulb. The finest in all of Holland.
Tulip Seller (Hendrik):
Ah, Johan, you have excellent taste. The last one sold for 5,000 guilders. But I have one left—yours for 6,200 guilders.
Johan:
6,200? That’s more than a canal house in the city!
Hendrik:
And yet, in a month, it could be 10,000! The French are buying, the English too. Soon, even kings will beg for them. You hesitate now, and tomorrow, it may be out of reach.
Johan:
Hmm… But what if the price falls?
Hendrik:
Falls? My dear Johan, have you seen a single bulb sell for less than the last? The price only goes up. And you don’t even need to take possession—just buy the contract and sell it later for a profit.
Johan:
True, true… And Pieter made a fortune last week flipping his contract. Very well, I’ll buy! Here’s a promissory note for 6,200 guilders.
Hendrik:
Wise decision! We’ll settle at the next exchange. Enjoy your fortune, my friend.
(One month later, February 1637—The bubble has burst.)
Johan (panicked, returning to the tavern):
Hendrik! The buyers are gone! No one wants my bulb!
Hendrik (grimly):
No one wants mine either… The market collapsed overnight. Your note is worthless.
Johan:
But… but I owe 6,200 guilders!
Hendrik:
So do I, Johan. So do we all.
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