Tulip prices steadily rose with their growing popularity and bulbs were purchased at higher and higher prices by speculators who planned to turn around and sell them for a profit, similar to modern-day house “flippers.” From 1634 to 1637, an index of Dutch tulip prices (see chart Fig. 57) soared from approximately one guilder per bulb to a lofty sixty guilders per bulb. Traders who sold their bulbs for a profit began to reinvest all of their profit into new tulip bulb contracts or new bulbs to sell to other Dutch citizens or to take with them on trips around the world to sell alongside with spices from the Dutch East India Company. Many merchants sold all of their belongings to purchase a few tulip bulbs for the purpose of cultivating and selling them for more profit than they could have ever made in a lifetime as a merchant. As the tulip bulb bubble crescended, already pricey tulip bulbs experienced a twentyfold price explosion in just a single month (Investopedia, 2012). By the peak of tulipmania in February of 1637, a single tulip bulb was worth about ten times a craftsman’s annual income and a single Viceroy tulip bulb was allegedly exchanged for the following goods (The Tulipomania, n.d):
- Two lasts of wheat
- Four lasts of rye
- Four fat oxen
- Eight fat swine
- Twelve fat sheep
- Two hogsheads of wine
- Four tuns of beer
- Two tons of butter
- 1,000 lb. of cheese
- A complete bed
- A suit of clothes
- A silver drinking cup
Successful Dutch tulip bulb traders, the archaic counterparts to the day traders of the late 1990s Dot-com bubble and the house flippers of the mid-2000s U.S. housing bubble, could earn up to 60,000 florins in a month– approximately $61,710 in current U.S. dollars (Allan Bellows, 2012). Tulip bulb speculation became so widespread by 1636 that they were traded on Amsterdam’s Stock Exchange and in Rotterdam, Haarlem, Leyden, Alkmar, Hoorn, and other towns. Around the same time, tulip speculation even spread to Paris and England, where tulips were traded on the London Stock Exchange. In both cities, traders strove to push tulip prices up to the lofty levels seen in Amsterdam but were only moderately successful in their attempt (The Tulipomania, n.d).
Astronomically-high tulip bulb prices resulted in some equally astonishing anecdotes such as the sailor who mistakenly ate an extremely rare Semper Augustus tulip bulb thinking it was an onion. This “onion” was so valuable that it could have fed his whole ship’s crew for an entire year. The hapless sailor was jailed for several months for his innocent but costly mistake. Another similar anecdote is of an traveling English botanist who was unaware of the Dutch tulip mania of the time, who peeled and dissected a wealthy Dutchman’s four thousand florin Admiral Von der Eyk tulip bulb mistaking it for an unusual species of onion. The bewildered English traveller was quickly led through the streets, followed by a mob, to be brought before a judge who sentenced him to prison until he could pay for the damage (The Tulipomania, n.d).
Like all bubbles, the Dutch tulip bulb bubble continued to inflate beyond people’s wildest expectations until it abruptly “popped” in the winter of 1636-37. A default on a tulip bulb contract by a buyer in Harlem was the main bubble-popping catalyst and caused the tulip bulb market to violently implode as sellers overwhelmed the market and buyers virtually disappeared altogether. Some traders attempted to support prices, to no avail. Within just a few days, tulip bulbs were worth only a hundredth of their former prices, resulting in a full-blown panic throughout Holland. Dealers refused to honor contracts, further damaging confidence in the tulip bulb market. Eventually, the government attempted to stem the tulip market meltdown by offering to honor contracts at 10% of their face value, which only caused the market to plunge even further. The brutal popping of the tulip bulb bubble ended the Dutch Golden Age and hurled the country into a mild economic depression that lasted for several years. The traumatic tulip bulb crash resulted in a suspicion toward speculative investments in Dutch culture for a very long time after. (One also has to wonder if this is how the Dutch reputation for frugality arose!)
720: One can only assume that our modern day stock market crashes are based off similar events correlating to the tulip mania.
Kicked Out of Heaven Vol. II
Paperback Now in Color $90.00
The Untold History of The White Races cir. 700 – 1700 a.d.
666 pgs + 196 pix = 1,000s of FACTS!
Kicked Out Of Heaven Vol. II: The Untold History of The White Races cir. 700-1700 a.d. is a 3 volume series that will be released one by one. This book details everything about European society and mentality. In this edition you will find these facts: Alcoholism & The Blue Devils, Insanity & Lead Poisoning, Ergot (LSD) Hallucinations, The Sweating Sickness & Leprosy, The Tobacco Enema & Leeches, The Defloration Mania, The Dancing Mania, The Black Death, The Gravediggers & Body Snatchers, Jews Poisoning the Wells, Millions of Deaths, Folklore & Superstition, Magic Mirrors & Crystal Balls, Witches Dancing in Baby Blood, Pants Made of Human Skin, Necromancy & Ghost Armies, Attacks from The Undead, Lycanthropy & Were-Wolves, Multiple Cases of Vampires, Who is Satan, Lucifer & The Devil!
MarketWatch: Quadruple witching day on Wall Street as the stock market trades in record territory.