Era 01 · 1634 — 1637

Tulip Mania

Peak to trough

−99% over 3 months

Pulse cycle

4.5s

Dutch tulip bulbs — specifically, the ones infected with a mosaic virus that produced striped 'broken' blooms — became the speculative asset of the 1630s. At the peak, a single Semper Augustus bulb traded for more than a luxurious Amsterdam canal house. Then, one February morning in 1637, a Haarlem auction failed. Prices collapsed 99% inside three months.

Events in this era

Nov 1636

Peak prices

At the top of the market, contracts on rare tulip bulbs traded at ten times an Amsterdam craftsman's annual wage. A single Semper Augustus bulb, prized for its red and white striping caused by a mosaic virus, reportedly sold for more than a three-story canal house. Most trades were futures on bulbs still buried in the ground, contracts on contracts, the first derivatives bubble in recorded history. Buyers rarely intended to take delivery. They planned to resell the paper.

Peak prices: ~10× annual wages per bulb

Feb 1637

Haarlem auction fails

On February 3, 1637, a routine bulb auction in the town of Haarlem opened to no bidders. The news spread through the tavern trading networks within days. Within three months, prices collapsed 99 percent across the Netherlands. Buyers refused to honor futures contracts. Dutch courts declined to enforce the obligations, effectively voiding the market. The province of Holland eventually ruled that contracts could be settled for 3.5 percent of the agreed price, a de facto wipeout.

−99% in three months; first modern crash

1634

Tulip futures emerge in taverns

Dutch tulip traders began selling contracts on bulbs still underground, to be delivered after winter dormancy. The practice moved into taverns, organized informally as 'colleges' of traders. There was no central exchange, no clearinghouse, no written law. The derivative market was where most of the speculation lived, not the underlying bulbs themselves.

Informal derivatives market, no legal backstop

Next era →

The South Sea Bubble

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