Green’s Dictionary of Slang

blooey! excl.

also blooee! blooie! bluey!

1. [1910s+] (orig. US) used to mimic the sound of an explosion.

2. [1920s–30s] used to denote failure, collapse.

In phrases

go blooey (v.) (also go blooie, go blooy) [echoic]

[1910s+] to explode suddenly, to go wrong, to fail, to break down.