From Bloomberg Echoes:
William Hogarth's "South Sea Scheme," created in
1721, shows victims of the bubble being taken for a ride on a merry
go-round. Source: The South Sea Scheme, William Hogarth; scanned from
"The genius of William Hogarth" or "Hogarth's Graphical Works"
The bubble of 1720 precipitated England’s first stock-market crash. In August of that year, shares in the South Sea Company reached a peak of 1,000 pounds and dropped to 150 pounds by the end of September.
The crisis devastated thousands of investors, including Sir Isaac Newton, who reputedly said after losing 20,000 pounds, “I can calculate the movement of heavenly bodies but not the madness of men.” The crash also permanently changed the structure of the constitutional monarchy, allowing a prime minister to become head of the government as the monarch gradually assumed the more ceremonial role of head of state.
The monarch at the time, King George I, was a controversial successor to his second cousin, Queen Anne. He inherited the English and Scottish thrones through the Act of Settlement of 1701, which excluded 54 closer relatives of the queen from the succession because they were Roman Catholic. George I, the prince of the German state of Hanover, was a Protestant.
King’s Mistress British Protestants, however, disapproved of his personal life. George I was unmarried, having divorced and imprisoned his wife for adultery in 1694. When he became king in 1714, he arrived in London with his illegitimate half-sister Sophia Charlotte von Platen, and his mistress Melusine von der Schulenberg. The two women were dubbed “the elephant” and “the maypole” by satirists because of their physiques. George Frideric Handel composed his famous “Water Music” to drown out the sound of Thames boatmen criticizing the king and his mistress as they traveled in the royal barge....MORE
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