Historical Financial Bubbles - Show 38-2

Tuesday, July 3, 2012 2,758 views

Three major financial bubbles burst onto the scene in 1720 due to a practice called “Wind-Trade,” referring to traders who were talking up share prices of shares they didn’t actually own. This unsustainable practice was based on speculation and was governed by no true regulations. Mark and Tom talk about the British, French and Dutch bubbles that popped at the same time nearly 300 years ago, showing a few historic prints from an economic-bibliographical study, “The Great Mirror of Folly.” Depicting that time of financial crisis, these sketches are worth studying as historical documents and serve as an enlightening window to see that similar visual images and language are still used today when referencing a “bubble.” We all know the saying, “there is nothing new under the sun.”

 

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