You didn’t fall for the stock. You fell for the person who already owned it.
You don’t want the stock because you analyzed its fundamentals. You want it because someone you admire owns it, and they own it because someone they admired owned it. Nobody in the chain wanted the stock for its own sake. They wanted what others wanted, and the wanting itself became the value. Yet ask anyone in that chain and they will tell you they found it on their own. Why does a bubble feel like independent discovery from inside, and why does it collapse so fast once it looks like a bubble?
The usual answer is greed: bubbles are irrational, and smart investors stay out. The more sophisticated answer is that bubbles are rational, because each buyer is betting the music won’t stop on their watch. Both miss what René Girard saw in desire itself.
Wanting what the model wants
Girard’s central insight is that human desire is not autonomous. We desire what others desire, through models whose wanting makes the object desirable. The snob is the clearest case:
The snob is also an imitator. He slavishly copies the person whose birth, fortune, or stylishness he envies… The snob does not dare trust his own judgment, he desires only objects desired by others. That is why he is the slave of the fashionable.
Markets synthesize beliefs about the future into present-day prices, which makes them something like religions that accumulate tension. A rising price is a model’s desire made public, telling the next buyer what to want. In relationships, the same pull draws people toward whoever mirrors their deepest wound, and they mistake the intensity for destiny. In markets, it draws them toward whatever asset is rising fastest, and they mistake the momentum for value. Because the imitation is invisible to the imitator, bubbles are not caused by irrationality or by rationality but by mimesis — the structural tendency to want what others want, which produces a self-reinforcing loop that no individual can see from inside because their own desire feels autonomous.
How a real signal becomes a fiction
Every bubble begins with something real, such as a genuine technological shift. Mimesis then inflates the signal, and the bubble becomes a pure bet on revolution, the new narrative against the old. More and more money follows investors less and less worthy of emulation. For a company whose price now depends on the story growing, the logic turns grim. Exaggeration becomes the only way to keep the company alive.
Meanwhile ownership homogenizes. Believers concentrate in the challengers while everyone else owns the same index of incumbents, so the market’s apparent calm is manufactured by the process that will shatter it: mimetic gradient-following removes the independent holders who could have absorbed a shock.
Then the mechanism becomes visible. A bubble that can be seen as a bubble rapidly deflates — a clear view of the inner workings is itself a sign of crisis in the system. Once buyers see that they wanted the asset because others wanted it, nothing is left holding up the price.
The bust as sacrifice
Girard’s deeper point concerns what communities do with that tension. Traditional religions discharge it through ritual sacrifice: a scapegoat absorbs the community’s violence, and the system resets. Markets have no ritual. The tension accumulates until the bust, which works as an uncontrolled sacrifice: wealth is destroyed, careers end, and the cycle starts again. On this reading the bust is not a malfunction. It is the structural equivalent of the sacrifice that a market, lacking ritual, has no other way to perform.
The strongest objection comes from Byrne Hobart, whose essay this note draws on. In [[boom|Boom]], he later argues that the same mimetic cascade is the only protocol humans have found for synchronizing belief, capital and talent on projects no rational actor would commit to alone. The rails, dark fiber and GPU stacks outlast the bust. Whether a bubble reads as pathology or productivity depends on which end of its lifecycle you measure, and on whether you were the one holding the stock when the sacrifice came due.
References:
- Byrne Hobart, Manias and Mimesis (The Diff)
- René Girard, Violence and the Sacred