Before you could even dust yourself off from the last bankruptcy, the wondrous free market is roaring ahead with a plan for your next one: "Concerns are mounting that efforts by governments and central banks to stoke a recovery will create a nasty side effect: asset bubbles in real-estate, stock and currency markets, especially in Asia."

Asia! Stop that, will you!

They are so totally into anything that makes bubbles, over there. Here in the USA, we're very particular about that sort of thing. Stocks and real estate? Boring as Xanax and apple sauce! Here, we're madly rushing to bet on the rebound of the flailing coin-operated laundry market, and investing in golden pennies made by artists (which is extra hard since there's only one), and oooo, impressionist art is so tantalizingly affordable right now!

It can only go up!

And America can never have too many luxury boutique hotels. Never!

So just keep investing, and hang in there. The funnest part of a bubble is when it pops.
[Pic: Flickr]

Speaking to reporters this very minute, CEO Eric Schmidt and co-founder Sergey Brin said the Mountain View, California company is through with its recent belt-tightening, which included layoffs and cutbacks in the company's famously posh perquisites. "We're increasing our hiring rate and investment rate in an anticipation of a recovery," Schmidt said, according to Peter Kafka of All Things D, who has been liveblogging Schmidt's meeting with the press.

Pressed further, Schmidt, net worth $5.5 billion, added:

From our perspective, the low point was somewhere in the spring. Which is why I said worst was behind us in May, June. Noticed recovery "Juneish". The conventional wisdom is that US recessions are 18-24 months. Bernanke sees a recovery too, which we agree with.

Added Brin ($15 billion), "And we're good indicator for consumer spending, and you can see for yourself by looking at Google Trends."

Meanwhile, national unemployment stands at 9.8 percent and Alan Greenspan, an actual economist and former Federal Reserve Board chair, predicts the economy will just get worse and then stagnate for a good long while. But he cited absolutely zero Google statistics for his prediction, nor does he get free food and laundry and transportation and snacks and internet access and literally actual trips to Disneyland provided for him free at work, so can you really trust it?

"We are seeing... good people leaving their jobs and joining startups, which is always a sign of confidence," a partner at Redpoint Ventures told the Beeb. "We are entering a stage of new reality." Apparently, there's talk of a boom. A handful of medium-sized companies most people have never heard of were recently acquired — Mint.com, OmniTure, SpringSource — and venture capitalists are dribbling out some cash from the oceans of money they are paid to invest. The Nasdaq has limped its way past the 2,000 mark again.

But enough of the selective evidence. Unemployment is still nearly 10 percent. The flow of capital outside the Valley startup bubble is still severely constrained. And even within the tech sector, the big paydays are few and far between. The IPO pipeline is dry, and startup buyers like Google and Yahoo have tightened their purse strings. This is why hot companies like Twitter, which is taking a fresh $50 million even with a reported $30 million in the bank, are stockpiling cash. Many are unprofitable, which also helps explain why, like Facebook, many have no plans to IPO any time soon.

This sort of brutal assessment is frowned upon in the Valley, where the hope of a big payday can get engineers working long hours for cheap, lawyers accepting scrip as payment and gullible investors pumping money into unworthy ventures. Hence, hype all too often prevails, despite an utter lack of profits or even, as is the case today, any big speculative infusions of cash from the equity markets. That's not a "new reality;" it's a cycle as old as the State of California.

(Image via)

Dot-com address acquisition is a dubious vestige of the first internet boom, when branding reigned supreme over profits and functionality, before entrepreneurs realized people would just look for them on Google. It was also Foursquare's first use of a $1.35 million investment from Fred Wilson's Union Square Ventures and O'Reilly AlphaTech; the software company tells Business Insider it couldn't have switched to foursquare.com from playfoursquare.com without the seed capital.

Investors obviously weren't deterred by the Google theft rumors, either. Some people inside the Googleplex believed Foursquare co-founder Dennis Crowley launched the iPhone service with code from Dodgeball, which Google bought from him in 2005 and then shut down. Crowley apparently told people at this year's South by Southwest conference the same thing, reasoning that Google wouldn't mind since it wasn't using the code anyway. It seems a safe bet that either Crowley was right or the rumors were wrong, since it's hard to imagine O'Reilly and Union Square Ventures sinking in money if Google were poised to sue.

The incentive to dispose of — or ignore — the issue would have been strong; the iPhone bubble is fast inflating, and your typical venture capitalist hates to be left out of a good hype cycle.

(Pic: Crowley, by See-ming Lee)

An attention seeker at an attention-seeking company said something outrageous about the iPhone, and of course the news is now everywhere. Here is the specific outrageous thing, spoken by the CEO of GetJar (you don't care what that is, trust us) to the BBC:

"Apps will be as big if not bigger than the internet... They will peak at around 100,000 by the end of the year. That will be a tipping point and after that there will be a gradual fall in the rate of development. "

Every bubble needs nonsense on which to feed. Ten years ago, during the dot-com bubble, we learned the following:

• The Dow would hit 50,000 (it's now just below 9,000).
  
• Amazon stock would hit 400 (it peaked around 115 and peaked above 300 but quickly fell back to Earth and now trades for about 80)
  
• The online ad business would be worth $28 billion by 2005 (try less than half that)

Since iPhone apps are internet apps, sold via the internet, for use on the internet, the idea they will be "bigger than the internet" somehow — in related software revenue? lines of code? time spent by users? — is nonsensical. And thus perfect for parting fools with their money! We can't wait for the first iPhone app investment fund. (Oh, nevermind, too late.)

(Pic: Steve Jobs with Deutsche Telekom and T-Mobile executives for the unveiling of the iPhone in Germany, September 2007.)

Remember Salon.com? It was once worth more than $100 million! Or so the stock market thought. Today it's worth about $700,000. Granted, it has about a quarter as many people coming to the site as HuffPo, and it pays its writers (a drag on earnings), and it now lacks the buzz of HuffPo.

It's also got roughly four times HuffPo's annual revenue, depending how much Huffington made in November. Is HuffPo's buzz and army of unpaid bloggers really worth tens of millions, maybe hundreds of millions, of dollars?

Probably not. Dumenco doesn't think so. But remember, HuffPo said it would use a portion of its money for "select acquisitions." Perhaps Arianna Huffington and her silver-tongued HuffPo co-founder Ken Lerer think they can buy their way out of the problems that felled so many online content entrepreneurs before them.

UPDATE: Has anyone heard anything about HuffPo's financial position immediately before taking on its $25 million venture capital round at the end of November? We heard things were pretty dire. ryan@gawker.com

The first person we could find to describe presidential life as living inside a bubble was, of all people, Ronald Reagan's oldest son Michael, who told UPI in 1983 that he was entering a Lake Michigan speedboat race to avoid getting "stuck in the presidential bubble."

But the term didn't really take off until 1992 when "security bubble" became a campaign coverage cliche, largely pushed by Clinton partisans, as a way to delineate elite George Bush (who didn't know the price of a gallon of milk) from the effusive friend-of-the-people Clinton (who liked to drop by McDonalds during his jogs). Here's Andrew Rosenthal writing in the New York Times in March of 1992:

Moving from the hermetically sealed, high-security bubble of President Bush's entourage to Gov. Bill Clinton's campaign is a journey through the political looking glass. It is not hard to imagine the two candidates standing on opposite sides of the mirror, looking at reflections distorted by politics and circumstances but in many ways the same.

Politico uses Obama's spontaneous trip with his daughters to a water-park last Friday to claim that "Obama seems to be struggling particularly hard, particularly early" with his new bubble life. But there again, Clinton did it first.

In Clinton's very first news conference after the election, Clinton was already worrying about whether he could keep up the level of accessibility he had during his campaign. "I'm a real sort of informal person," the boy from Hope lamented to reporters, according to the A.P.. "We went out of our way to demonstrate ... that we can be genuinely accessible to the American people."

A week before Clinton was sworn in, he set down the definition of just why the bubble was so pernicious during an interview with Arkansas reporters:

Q: Given your gregarious nature, Governor, I know that others worry about your safety. Do you worry about that now, going into this job?

PRESIDENT-ELECT CLINTON: Not much, just because there's not much I can do about it. I mean, I think the Secret Service does a fine job. Goodness knows my life is more restricted now than ever before. I do think there are ways that I can keep in touch with people and accommodate their security concerns and we're looking for those. I do want to listen to them to some extent.

You can't let the security bubble shut you down. I mean, it's hard enough to stay in touch with people as it is. Not always easy as governor. It's easy as a governor to get out of touch, but it's hard in a state like Arkansas where everybody calls you by your first name and you're supposed to run the office like a country store. I mean, it's different.

But there, where most people assume they should not see the president and where it's literally impossible for the president to personally see more than a certain number of people every day, or to talk to more than a certain number of people on the phone, you could just live your whole life in that bubble.
I mean, you live in the White House, you just go to Camp David where there's nobody else and you go around in an armored car and you fly in Air Force One, and you just — you have — there has to be ways for the president to stay in touch with the pulse of America. It's not just that I enjoy it, although I do.
It is very important because I think a lot of people — I think President Bush, for example, wanted to do a good job and I think really missed the level of misery and anxiety people had on the economy for a long time just because the way the presidents spend their days.

Ultimately, of course, it wasn't a "security bubble" that swallowed Clinton's presidency, but rather a legal one after Ken Starr and his investigators closed in. And here lies the real reason that Clinton must hate Obama so much: as long as Barack keeps his dick in his pants, he has the chance to live up to the potential that Clinton squandered for a blow job from an intern.

There are so many gaudily fraudulent characters in the story of this country's mania for buying and selling homes — like Sam Leccima, the former Flip This House star who allegedly slapped "Sold" signs on unsold houses and didn't even have a real-estate license. A&E yanked his shows from the channel's lineup after charges that his house-flipping efforts were a hoax.

Instead, the Times is going after bigger names with flimsy arguments. Bill Clinton, who was so desperate to win reelection that he came up with a crazy tax exemption for profits on the sale of one's residence that singlehandedly inflated the housing bubble, except it didn't, the Times revealed on Friday.

Wait, no — it was George W. Bush, whose wicked, wicked "drive for home ownership" singlehandedly inflated the housing bubble, except it didn't, the Times revealed today.

In this exciting series called "The Reckoning," we will surely find out tomorrow that it's all Barack Obama's fault, except it's not.

Who will the Times blame but not blame tomorrow? Once it runs out of politicians, we suggest the newspaper of record move on to the world of television.

Surely the greedy sons of bitches who greenlighted Extreme Makeover: Home Edition and Sell This House and the scheming opportunists who grabbed free advertising for their housing investments deserve every bit as much excoriation as some boring wonk who proposed an obscure tax-law change. The home-makeover bubble is a telegenic scandal just begging for Congressional hearings.

$6 Million for the Co-op, Then Start to Renovate [NYT]