Could you imagine the most beautiful tulip flower with price tag $750,000? No? That was the reality of tulip mania in 1636-1637 in Holland. Here’s more details about this unique flowers’ bubble.
Tulips originated from Turkey and first arrived in Western Europe in the late 1500’s. Tulip is fragile as rare (at least it used to be rare). As a result tulip became the status symbol for wealthy people. Demand and not enough supply driven prices crazy high.
In 1637 regular tulips sold for $50,000 (in today’s prices). In the same time professional traders have seen opportunity to make money on rising prices and lack of supply. Demand was so high that tulip trading was established on Stock Exchange of Amsterdam.
Tulip prices crashed as demand reduced and traders used margin to buy more tulips. Many experienced and newbies traders became bankrupt. This is the perfect example how society craze for such a fragile status symbol could leads to bubble burst.
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