Gab@StFerdinandIII - https://unstabbinated.substack.com/
Plenty of cults exist - every cult has its 'religious dogma', its idols, its 'prophets', its 'science', its 'proof' and its intolerant liturgy of demands. Cults everywhere: Corona, 'The Science' or Scientism, Islam, the State, the cult of Gender Fascism, Marxism, Darwin and Evolution, Globaloneywarming, Changing Climate, Abortion...
Tempus Fugit Memento Mori - Time Flies Remember Death
Tulips were imported from the Near East, originally by a wealthy aristocrat named Herwart, whose friend, one named Gesner, saw a species in Herwart's Augsburg garden, and commanded from a supplier in Constantinople, a number of the bulbs. This was 1559, a mere 30 years after the Turks had tried to take Vienna and by extension Europe; 6 years before the pivotal Turkish defeat at Malta and 12 years before the Moslem navy was smashed at Lepanto. Even in times of totalitarian threats, commerce and curiosity it appears, can soldier on.
In Mackay's opus, [review here] he has a chapter devoted to the offspring of Gesner's curiosity. And curious reading it makes too. As the Moslems busied themselves with Jihad, the good burghers of Amsterdam and the Rhineland estates preoccupied themselves with pretty flowers. The mighty tulip which is a corrupted word for 'Turban', became synonymous with wealth, sophistication and importance. The madness of crowds indeed.
Tulips make a strange store of value. They are short-lived; do not give off a perfume; and do not possess the elegance of a rose, or as Mackay says, even a sweet-pea. For some reason, the Dutch, in opposition to logic, reasonableness, common-sense and good taste, decided to make the Tulip the most valuable single asset class by 1634. It was a general insanity and the madness pervaded all ranks of society.
Mackay: “As the mania increased, prices augmented, until, in the year 1635, many persons were known to invest a fortune of 100.000 florins in the purchase of forty roots.”
In today's money that is roughly 5 million Euros. A single root of a rare Tulip species fetched no less than 2.500 florins or about 150.000 Euros. Madness what madness ?
Tulip speculation resulted in the establishment of trading depots in Amsterdam, Haarlem and elsewhere. 'Stock jobbers' jostled up the trade in tulips, selling and buying roots and bulbs on behalf of individuals and even firms. It was a form of gambling. Many grew magically rich in bulb speculation. No one wanted to be left out.
Mackay: “Every one imagined that the passion for tulips would last for ever, and that the wealthy from every part of the world would send to Holland, and pay whatever prices were asked for them.”
As money poured in from foreign lands, the prices of life's necessities increased. Houses, land, horses, carriages, and luxuries of every variety rose in value. The tulip trade became so pronounced that a separate code of laws was drawn up to manage it. An entire industry of tulip-lawyers came into existence, busy with notations, contracts, stamping and market regulation. The mania's maniacal apogee was in November 1636.
Late in 1636 brain activity returned to the Dutch. The impulses of electricity and neuron functionality reappeared. As prices skyrocketed out of control, the smarter sold and pocketed the profits, never to buy again. As this process was repeated, prices fell, never to recover. In a few short weeks it was all over.
The great scam, in which a flower cost the value of 4 large Dutch estates was extinguished. Many were ruined. The pyramid scheme of money laundering was smashed. Useless inventory abounded. Howls for government to 'do something' redounded. There was nothing for the government to do. Many rich were now quite poor. Neighbour blamed neighbour for the catastrophe. Class directed epithets against other classes. But perhaps in the end, they had only themselves to blame. Irrational greed, be in tulips or any other asset class, will always end in destruction.