Tulip Mania

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Tulip Mania

History's first major asset bubble. Tulips were introduced to Europe from the Ottoman Empire in the mid-1500s and became very popular in the Netherlands. As they grew in popularity, prices for tulips rose steadily, then unsustainably, in the 1630s. Prices suddenly collapsed in February 1637. Interestingly, tulip mania resulted in the creation of a formal futures market and marked one of the first times when contracts were traded without exchanging the underlying asset.
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But actually, the year that has seized public imagination is 1624, famous in Dutch history for the Great Tulip Boom and Bust.
Drawing on extensive research in a wide range of archives, and investigating sources completely ignored by earlier authors, such as notarial records and those of small-claims courts, she shows that the tulip boom, far from representing a case of mass irrationality, was actually the product of intellectual, familial, and commercial networks among a relatively small and prosperous subset of Dutch burghers.
The tulip boom went bust, however, in 1637 when the Dutch government stepped in and forbade trading because, as Pavord puts it, "countrymen were going completely potty over tulips.