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The Real Story Behind the 17th-Century ‘Tulip Mania’ Financial Crash

March 16, 2020 in History

By Dave Roos

The speculative frenzy over tulips in 17th century Holland spawned outrageous prices for exotic flower bulbs.

In 1636, according to an 1841 account by Scottish author Charles MacKay, the entirety of Dutch society went crazy over exotic tulips. As Mackay wrote in his wildly popular, Memoirs of Extraordinary Popular Delusions and the Madness of Crowds, as prices rose, people got swept up in a speculative fever, spending a year’s salary on rare bulbs in hopes of reselling them for a profit.

Mackay dubbed the phenomenon “The Tulipomania.”

“A golden bait hung temptingly out before the people, and one after the other, they rushed to the tulip-marts, like flies around a honey-pot,” wrote Mackay. “Nobles, citizens, farmers, mechanics, sea-men, footmen, maid-servants, even chimney-sweeps and old clothes-women, dabbled in tulips.”

When the tulip bubble suddenly burst in 1637, Mackay claimed that it wreaked havoc on the Dutch economy.

Tulip price index from 1636-1637. The values of this index were compiled by Earl A. Thompson in Thompson, Earl (2007), “The Tulipmania: Fact or artifact?”, Public Choice 130, 99–114 (2007).

“Many who, for a brief season, had emerged from the humbler walks of life, were cast back into their original obscurity,” wrote Mackay. “Substantial merchants were reduced almost to beggary, and many a representative of a noble line saw the fortunes of his house ruined beyond redemption.”

But according to historian Anne Goldgar, Mackay’s tales of huge fortunes lost and distraught people drowning themselves in canals are more fiction than fact. Goldgar, a professor of early modern history at King’s College London and author of Tulipmania: Money, Honor and Knowledge in the Dutch Golden Age, understands why Mackay’s myth-making has endured.

“It’s a great story and the reason why it’s a great story is that it makes people look stupid,” says Goldgar, who laments that even a serious economist like John Kenneth Galbraith parroted Mackay’s account in A Short History of Financial Euphoria. “But the idea that tulip mania caused a big depression is completely untrue. As far as I can see, it caused no real effect on the economy whatsoever.”

READ MORE: Here Are Warning Signs Investors Missed Before the 1929 Crash

The problem, says Goldgar, is the source material that Mackay used. In 17th-century Holland, there was a rich tradition of satirical poetry and song that poked fun at what Dutch society deemed to be moral failures. Out of that tradition came entertaining pamphlets …read more

Source: HISTORY

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7 Surprising Facts About St. Patrick's Day

March 16, 2020 in History

By History.com Editors

Who was the real St. Patrick? Was that legend about the snakes true? And why did so many St. Patrick’s Day traditions start in America?

While St. Patrick’s Day is now associated with wearing green, parades (when they’re not canceled) and beer, the holiday is grounded in history that dates back more than 1,500 years. The earliest known celebration was held on March 17, 1631, marking the anniversary of the death of St. Patrick in the 5th century. Learn more about the holiday’s history and how it evolved into the event it is today.

1. The Real St. Patrick Was Born in Britain

St. Patrick

Much of what is known about St. Patrick’s life has been interwoven with folklore and legend. Historians generally believe that St. Patrick, the patron saint of Ireland, was born in Britain (not Ireland) near the end of the 4th century. At age 16 he was kidnapped by Irish raiders and sold as a slave to a Celtic priest in Northern Ireland. After toiling for six years as a shepherd, he escaped back to Britain. He eventually returned to Ireland as a Christian missionary.

Learn more about St. Patrick’s life here.

2. There Were No Snakes Around for St. Patrick to Banish from Ireland


St. Patrick depicted with his foot on a snake.

Among the legends associated with St. Patrick is that he stood atop an Irish hillside and banished snakes from Ireland—prompting all serpents to slither away into the sea. In fact, research suggests snakes never occupied the Emerald Isle in the first place. There are no signs of snakes in the country’s fossil record. And water has surrounded Ireland since the last glacial period. Before that, the region was covered in ice and would have been too cold for the reptiles.

Read more about Ireland, snakes and the legend here.

3. Leprechauns Are Likely Based on Celtic Fairies


Leprechauns are known as mischievous Irish fairies.

The red-haired, green-clothed Leprechaun is commonly associated with St. Patrick’s Day. The original Irish name for these figures of folklore is “lobaircin,” meaning “small-bodied fellow.” Belief in leprechauns likely stems from Celtic belief in fairies— tiny men and women who could use their magical powers to serve good or evil. In Celtic folktales, leprechauns were cranky souls, responsible for mending the shoes of the other fairies.

Read more about the fairies known for their trickery <a target=_blank …read more

Source: HISTORY