This is from one of my favorite writers, Gregg Easterbrook.
“Tech start-ups were a bubble, the housing market was a bubble; most likely there’s a gold bubble in progress, and when the gold bubble bursts, everyone will claim to have known it all along! The bubble to worry about is the cupcake bubble: all those fancy cupcake bakeries suddenly in New York, Boston, Washington, San Francisco and Seattle, offering $5 cupcakes hard to distinguish from supermarket cupcakes. It’s a bubble: Capital is flowing into the opening of cupcake boutiques because, right now, consumers are willing to pay a premium for a sweet that is inexpensive to bake. As with other bubbles, this one is based on exaggerated claims and assumptions that can’t last. In 2009, for whatever reason, people will stand in line to fork over $5 for a cupcake that masquerades as “red velvet” or “pink lemonade.” Odds people will continue to do this long-term? 0.0 percent. Anyone opening a fancy cupcake bakery is jumping into the downside of a bubble. Don’t say you weren’t warned.”
This article makes me think of how private business in Kuwait seems to go in phases. First it was the advertising agencies. Then is was the fashion designers followed by the burger stores. Now its the Cupcake and baked good fad. i wonder what we’ll see next.