#adigitalblogger #history #stockmarket
First Market Crash:
Stock Market Crash toh bohot hue hain lekin pehla hi itna bhayanak tha ki uss waqt ka sabse samajdaar insaan, Newton bhi lakhon rupaiye gawaa baitha.

It all began when a British joint stock company called ‘The South Sea Company was founded in 1711.

Its purpose was to supply 4800 slaves each year for 30 years to the Spanish plantations in Central and Southern America.

Britain had put so much faith in this stock that they thought the profits from this would clear the national debt of Britain which was 70 Lakh Pounds.

For the people to encourage trading in this stock, King George himself then took governorship of the company in 1718. This inflated too much confidence and a bubble started to emerge.

Some intelligent politicians of that time such Archibald Hutcheson started warning people that the share of South Sea which stood at 1000 should actually just be 200. But people were already into a state of herd mentality.

In fact some were bribing their relatives and friends to pick up shares deliberately.

But the fact remained that the company itself was not actually making anywhere near the profits it had promised. Instead, it was just trading in increasing amounts of its own stock.

And in September of 1720 the bubble burst. Stocks plummeted, down to £124 by December, losing 80% of their value at their height. Investors were ruined, people lost thousands, there was a marked increase in suicides and there was widespread anger and discontent in the streets of London