What was the name of the 1720 British financial bubble centered on a trading company?
Answer
South Sea Bubble
Answer
South Sea Bubble
The 1720 British financial bubble centered on the South Sea Company is called the South Sea Bubble.
The South Sea Company received a government-backed monopoly over British trade with parts of Spanish America, although its realistic trading prospects were far more limited than many investors believed. The company also took on government debt, which helped give it political importance.
In 1720, speculation drove its share price dramatically higher. Investors included members of the British elite, and the excitement spread beyond the company itself to numerous ventures that promised extraordinary returns. When confidence broke, the price collapsed and many investors suffered severe losses.
The South Sea Bubble is often discussed alongside France's Mississippi Bubble, which burst in the same year. It was not a stock-market crash in the modern, broad-index sense, but it is one of the earliest famous examples of a major speculative financial collapse.
Source: Wikipedia · fact-checked Oct. 2026