Manias and Mimesis: Applying René Girard’s Mimetic Theory to Financial Bubbles

As the bubble grows in scope, the contradiction becomes more visible, leading to a third common characteristic of bubbles: the bifurcation of viewpoints into totally-

positive or totally-negative

the best stories to tell are the ones that have been told over and over again, and the stories of competitive mimesis and of deification followed by scapegoating are the oldest and best of all

The frenetic build-up of bubbles and their violent collapse provides some of the purest examples of the mimetic process—they crystallize fear, hope, hype, overconfidence, or under-confidence

Every bubble begins with something real, which inspires entirely too much fakery

markets—these sublime machines that synthesize beliefs and aggregate them into prices—instantiate a secularized version of the sacred

as the bubble grows, it becomes an increasingly pure bet on a revolution