Which event is widely regarded as the first major stock-market crash in modern history?

The South Sea Bubble is widely regarded as one of the first major stock-market crashes in modern history.

The South Sea Company was founded in England in 1711 and received trading privileges connected with Spanish South America. In 1720, Parliament approved a plan allowing the company to take over part of the national debt, helping its shares become the focus of intense speculation.

Share prices rose dramatically as investors expected enormous commercial profits. The company’s actual trading prospects were far more limited than the excitement suggested. When confidence broke later in 1720, the share price collapsed and ruined many investors.

The South Sea Bubble was not an isolated British event. Speculation also surrounded the Mississippi Company in France, producing a related collapse. The phrase “South Sea Bubble” specifically refers to the British episode, while “Bubble” is the common name for the broader speculative mania and crash.