Which 1720 British bubble centered on a company granted a monopoly over South American trade?

The 1720 British bubble centered on a company granted a monopoly over South American trade was the South Sea Bubble.

The South Sea Company received a monopoly over trade with Spanish South America in exchange for taking on part of the British government’s debt. In practice, the company’s commercial trading opportunities were far more limited than many investors imagined. Its shares nevertheless rose dramatically as politicians, financiers, and the public promoted the company’s prospects.

The share price peaked in August 1720 before collapsing later that year. Many investors borrowed to buy shares, so the decline caused serious financial losses and political scandal. Parliament investigated the company’s directors and associated corruption.

The South Sea Bubble occurred alongside John Law’s Mississippi Bubble in France. These episodes are often grouped with the better-known Dutch tulip speculation, but they involved different assets, institutions, and political arrangements. The South Sea event was a stock-market bubble tied closely to government debt conversion.