Before 1634, tulips, like other flowers, were planted by flower farmers and delivered directly, with little price fluctuation. At the end of 1634, Dutch tulip merchants formed an organization similar to the industrial guild (college), which basically controlled the tulip trading market. The guild stipulates that any tulip business must pay fees to the guild. Each Dutch guilder contract is handed over to the guild at 1/40. The cost of each contract shall not exceed 3 guilders at most. Because these guilds usually trade tulips in pubs, the fees they charge are usually called "drinks". Due to the rising demand for tulips, people are generally optimistic about the trading prospects of tulips and have invested in tulip contracts. The harvest period of tulip bulbs is September every year. At the end of 1636, the Dutch tulip market not only bought and sold tulip bulbs that had been harvested, but also bought and sold bulbs that would be harvested in advance of 1637. After the tulip transaction is relatively concentrated, the information of buyers and sellers can circulate quickly, and the transaction cost is greatly reduced. There are no clear rules in this futures market, and there are no specific constraints on buyers and sellers. Tulip contracts are easy to buy and sell, and they have changed hands several times in a short time. This makes it possible for businessmen to make love and short in the futures market. In the process of changing hands many times, the price of tulips has been rising.
Under the control and manipulation of the guild, the price of tulips was quickly raised. Buying and selling tulips has made some people make huge profits. The soaring price of tulips attracted many people from all over Europe to Holland, and they brought a lot of money. A large amount of foreign capital flowed into the Netherlands, which encouraged the tulip trade.
During the period from1636,65438+February to1637,65438+1October, the prices of tulip varieties rose across the board. Take a rare variety, Haoda, as an example. Its price was only 1.5 guilders/ounce at the end of 1634, and it only rose to 2 guilders/ounce at the end of 1636. With the formation of tulip speculative market, the price of Gundam fluctuates greatly. 1636 1 1, the price soared to 7 kilde, then fell back to 1.5 kilde, 12, and the price rebounded strongly again, reaching 1 1 kilde. After the new year, it plummeted to 5.5 gilds. Due to the participation of new speculators, the price rose sharply again, and 10/4 Kilde mark was broken on October 29th. These three ups and downs, each oscillation amplitude exceeded 400%. Compared with the lowest point of 65438+February 9th (1.5 Kilde) and the highest point of 65438+February 2nd (1 1 Kilde), the price rose nearly 10 times in three days. Excess profits attracted speculators from all directions. Perhaps some people have long suspected that the price of tulips as a flower has completely deviated from the routine, but the huge profits made many speculators lose their minds. By June, 1637, 1, even the price of common tulips has increased by more than 25 times. For example, the price of Switsers was lower than 1 Kilde in the first ten days of 1637 1, but it was fired to 14 Kilde at the end of the month, and rose to 30 Kilde on February 5th, which was more than 29 times in 30 days. During this period, almost every speculator was immersed in the dream of making a sudden windfall.
1637 Around the New Year, tulip futures contracts were heated up in Dutch inns. In February of 1637, profiteers gradually realized that it was time to deliver tulips. Once the bulbs of tulips are planted in the ground, it is difficult to sell them again. People began to wonder how much tulip bulbs bought at such a high price could be worth just for flowering. Not long ago, the rare commodity tulip contract suddenly became a hot potato. People who hold tulip contracts would rather have less than throw them to others. After people's confidence was shaken, the price of tulips immediately began to fall. The falling price has led to further loss of confidence in the tulip market. People who hold tulip contracts can't wait to get rid of them, but it's hard to find a "fool" at this juncture. The result of the vicious circle is the collapse of the tulip market.
The peak period in tulip bubble only lasted for more than a month. Because many tulip contracts have changed hands many times in a short period of time and have not been delivered so far, the last person holding tulip contracts began to recover the payment from the previous seller. The man asked the man in front for a debt again. The tulip market in the Netherlands has changed from a prosperous period in the past to a hell of bitterness and debt evasion.
1637 On February 24th, the flower shop held a meeting in Amsterdam, the capital of the Netherlands, and decided that the tulip contract signed before February 1636 must be delivered, and the buyer has the right to pay 10% less for the contract signed later. This decision not only did not solve the problem, but also aggravated the chaos in the tulip market. The relationship between buyers and sellers is very tangled. The Dutch government had to intervene and refused to approve the proposal. 1637 On April 27th, the Dutch government decided to terminate all contracts. A year later, the Dutch government passed a regulation allowing the final buyer of tulips to terminate the contract after paying 3.5% of the contract price. According to this regulation, if the ultimate holder of tulip has paid off the payment, his loss may exceed 96.5% of the original investment. If he hasn't paid the payment, but fortunately he only paid 3.5% of the contract price, then the person who sold him this contract will suffer very serious losses. Under this blow, the Dutch tulip speculation market has collapsed.