Recreating the South Sea bubble: Lessons from an experiment in financial history

Major bubble episodes are rare events. In this paper, we examine what factors might cause some asset price bubbles to become very large. We recreate, in a laboratory setting, some of the specific institutional features investors in the South Sea Company faced in 1720. Several factors have been proposed as potentially contributing to one of the greatest periods of asset overvaluation in history: an intricate debt-for-equity swap, deferred payment for these shares, and the possibility of default on the deferred payments. We consider which aspect might have had the most impact in creating the South Sea bubble. The results of the experiment suggest that the company?s attempt to exchange its shares for government debt was the single biggest contributor to the stock price explosion, because of the manner in which the swap affected fundamental value. Issuing new shares with only partial payments required, in conjunction with the debt-equity swap, also had a significant effect on the size of the bubble. Limited contract enforcement, on the other hand, does not appear to have contributed significantly.

The financial history of Connecticut from 1789 to 1861 /

"Published under the auspices of Yale University."

Instructions to accountants relating to manner of recording data in connection with financial history of common carriers /

Signed: D.E. Brown, Supervisor of Accounts.

[Financial history of Japan.

Translation of t.-p.

Banks and Bankers of the Keystone State: containing a complete history of the banking interests of Pennsylvania from the organization of the first bank in 1780 to the present time, together with portraits and biographical sketches of the prominent figures in a century and a quarter of financial history.

Mode of access: Internet.

Financial history of the United States.

Mode of access: Internet.

The financial history of the United States.

Mode of access: Internet.

A financial history of Maryland (1789-1848)

Mode of access: Internet.

Financial history of

Mode of access: Internet.

Financial pamphlets

A collection of miscellaneous pamphlets on finance.

The Regulation of Foreign Banks in Switzerland (1956-1972)

The Swiss financial centre witnessed an important shift during the 1960s: the number of foreign banks and their importance in relation to the domestic banking sector significantly increased. Faced with this rapid development, Swiss bank representatives and political and monetary authorities reacted strongly. This paper investigates the evolution of the regulatory response by Swiss banking policy actors to the proliferation of foreign financial in- stitutions. In 1969, those reactions led to the adoption of a discriminatory regime, setting higher entry barriers for foreign banks than for domestic institutions. After examining possible reasons for the attractiveness of Switzerland to foreign banks, this paper will analyse the concerns and fears of the domestic banking sector and its regulators. In this regard, it appears that issues such as mere competition, preservation of the international reputation of the Swiss banks and anti-inflationary monetary policy were central to the chosen regulatory regime. Moreover, this paper shows that foreign banks were used as scapegoats in the evolution of the Swiss system of banking supervision. They were more tightly regulated, yet the general framework remained very lax.

Schooner Ranger document

A page of entries detailing the financial history of the Schooner Ranger, a Great Lakes cargo ship, from 1810-1815. The ship sustained damage in 1811 on its journey from Detroit to Black Rock, in which 3 people drowned. The ship was subsequently “destroyed by the enemy in January 1813”. In August 1815, the ship’s account was settled. The settlement acknowledged that the ship was “taken by the U.S. Navy Officers for the use of the Government”, and is signed by Porter, Barton & Co., and George Kibbe.

Schooner Ranger document, 1810-1815

Partial transcription: Buffalo, August 15, 1815 This day settled all accounts between… respecting the purchase and sailing of the Schooner Ranger until she was laid up in the fare of 1811. For the value of the…of the said Schooner destroyed by the enemy in January 1813 and the rigging & c taken by the U.S. Navy Officers for the use of the Government a [Joint][appreciation] is to be made... Government for our mutual benefit. Porter & Barton for [the firm] of Porter Barton & Co. George Kibbe

Credit Default Swaps (CDS) y Collateral Debt Obligation (CDO) derivados financieros responsables de la crisis sub-prime de 2008 en Estados Unidos y una guía para el desarrollo del mercado de derivados exóticos en Colombia

La crisis financiera hipotecaria de 2008 en la que se declaró en quiebra el banco de inversión Lehman Brothers, se desarrolló en un ambiente que contemplaba apalancamientos financieros excesivos y el uso de derivados financieros de crédito innovadores. Razón por la cual, a partir del estudio de caso de quiebra de este banco de inversión y el análisis de las causas y consecuencias del ambiente desregulatorio que surgió en Estados Unidos desde la década de los 30 hasta el 2000, se orienta la investigación a indagar sobre lo que sucede en términos regulatorios y empresariales en el mercado de valores colombiano y así lograr definir objetivos que permitan el crecimiento del mercado de derivados exóticos en Colombia bajo un marco de responsabilidad financiera y ética empresarial.