My dear Joseph G., no, I am not 398 years old, no, I have not kept a record of tulipmania since 1630, and yes, I think I know something about bubbles, but I am always willing to learn more.
I will admit that the only histories of bubbles I have read that I can put my hands on without going into the basement storage area are as follows:
1. Extraordinary Popular Delusions and the Madness of Crowds.
2. Panics, Manias and Crashes.
3. Frozen Desire - the Meaning of Money.
As a former Louisiana history major, I had an interest in John Law and the Mississippi Bubble, but the books on that topic are in the basement crawl space, and I don't really feel like digging through the boxes to give you their names.
I take up, in response to your challenge, Frozen Desire, by James Buchan, and turn to his account, which is taken from a contemporary satire of the speculation published in 1637, entitled the Samenspraeck tusschen Waermondt ende Gaergoedt nopende de opkomst ende ondergang von Flora:
"Tulips flower in April and May for about ten days, die back and may be taken out of the ground in june, but must be returned to it by the autumn. Originally, according to the dialogues [the source] bulbs were bought and sold by growers by the piece or, occasionally, by the bed and only for immediate delivery in June. But from the summer of 1634, excited by the fashion for broken flowers [flowers that had been infected by a mosaic virus that caused flame-patterned coloration] in Holland and France, non-professionals entered the trade . . . ." "Prices rose steeply throughout the 1635-1636 season. By the next season, the trade had lost all relation with any physical object. The trade was, in the phrase the Dutch had taken over from the Italians, in blanco, 'in the white' or 'in the space' or what we now call short-selling. The seller sold azen [unit of weight] of bulbs he did not possess against a value, usually but not always money, which the buyer did not possess, round and round. Neither party intended to deliver anything. They were simply betting on the future price of bulbs: and on settlement date the loser paid the difference between the price of the contract . . . and the current price in the market." . . . "By the winter of 1636-37, the growers at Haarlem were becoming anxious that they would soon be left with beds of worthless stock. According to the Samenspraeck, confidence cracked on February 3."
By this account, true tulipmania, as I would define it, commenced in the 1636-37 season, when "the trade had lost all relation with any physical object," and speculative mania began, which ended 2/3/1637. According to this contemporary account, this was not the three years you suggest.
I am always willing to learn more and different facts, should you possess them. Please feel free to educate me if you've a mind to.
Very truly yours,
CobaltBlue
P.S. Tulip industry in Holland is extraordinarily prosperous, as, of course is Louisiana as John Law knew it (the Louisiana Purchase). . . Buchan says that the only error made by investors was having too short of a time horizon. Food for thought. |
