Which 1720 British speculative bubble is widely regarded as an early stock-market crash?

The South Sea Bubble was the 1720 British speculative bubble widely regarded as an early stock-market crash.

The South Sea Company received a government-backed monopoly over trade with Spanish South America, although its realistic trading prospects were limited. Its shares rose dramatically as investors were encouraged by promotion, political connections, and the belief that the company’s future profits would be enormous.

The price collapsed later in 1720. Investors who had bought at inflated levels suffered severe losses, and the panic spread to other ventures. The episode damaged public confidence and led to parliamentary investigations into corruption and improper influence. Several prominent figures were implicated in the controversy.

The South Sea Bubble is often mentioned alongside France’s Mississippi Bubble, which also burst in 1720. They were separate schemes in different countries, so the names should not be treated as interchangeable. Tulip Mania, another famous speculative episode, occurred in the Dutch Republic during the 1630s rather than in Britain in 1720.