![]() When the crash came, it was not because of naive and uninformed people entering the market, but probably through fears of oversupply and the unsustainability of the great price rise in the first five weeks of 1637. Hans Bollongier, 'Floral still life', 1639 (Rijksmuseum) Far from every chimneysweep or weaver being involved in the trade, the numbers were relatively small, mainly from the merchant and skilled artisan class – and many of the buyers and sellers were connected to each other by family, religion, or neighbourhood. With one or two exceptions, these top buyers came from the wealthy merchant class and were well able to afford the bulbs. Although it’s true that the most expensive tulips of all cost around 5,000 guilders (the price of a well-appointed house), I was able to identify only 37 people who spent more than 300 guilders on bulbs, around the yearly wage of a master craftsman. Prices could be high, but mostly they weren’t. Perhaps some people inheriting money had a bit more in their pockets to spend on bulbs. Despite an epidemic going on during 1636, the biggest price rises occurred in January 1637, when plague (mainly a summer disease) was on the wane. Far from bulbs being traded hundreds of times, I never found a chain of buyers longer than five, and most were far shorter.Īnd what of the much-vaunted effect of the plague on tulip mania, supposedly making people with nothing to lose gamble their all? Again, this seems not to have existed. It also became increasingly organised, with companies set up in various towns to grow, buy, and sell, and committees of experts emerged to oversee the trade. In fact, for much of the period trading was relatively calm, located in taverns and neighbourhoods rather than on the stock exchange. The trouble is, most of it is untrue.Ī sign of good taste? Michiel Jansz van Mierevelt, 'Double portrait with tulip, bulb, and shell', 1606, Author provided The government finally stepped in and ceased the trade, but not before the economy of Holland was ruined. Desperate bankrupts threw themselves in canals. It was the foolishness of newcomers to the market that set off the crash in February 1637. Tulips were sold for crazy prices – the price of houses – and fortunes were won and lost. No one wanted the bulbs, only the profits – it was a phenomenon of pure greed. ![]() ![]() ![]() The same tulip bulb, or rather tulip future, was traded sometimes 10 times a day. Everyone in the Netherlands was involved, from chimney-sweeps to aristocrats. Tulip mania was irrational, the story goes. The same aspects of it are constantly repeated, whether by casual tweeters or in widely read economics textbooks by luminaries such as John Kenneth Galbraith. Why this lasting fixation on tulip mania? It certainly makes an exciting story, one that has become a byword for insanity in the markets. Bitcoin, according some sceptics, is “ tulip mania 2.0”. All these were compared by contemporaries to “tulip mania”, the Dutch financial craze for tulip bulbs in the 1630s. But in the past we’ve had dotcom stocks, the 1929 crash, 19th-century railways and the South Sea Bubble of 1720. ![]()
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