History 2186A/B Lecture Notes - Lecture 4: South Sea Company, Life Insurance, Economic Bubble

• School: Western University
• Department: History
• Course: History 2186A/B
• Professor: Jonathan F Vance

Document Summary

Are (cid:271)ased o(cid:374) the (cid:374)otio(cid:374) of (cid:862)i (cid:449)ill lose it all. (cid:863) Panic emerges from not what is actually happening but from what people think it(cid:859)s happening. It has the ability to create financial crises where they do(cid:374)(cid:859)t exist. The kipper-und wipperzeit: earliest days: coins were made of precious metal, like gold. So the value of the coin is the o(cid:374)e of the (cid:373)etal, so it does(cid:374)(cid:859)t de(cid:272)rease i(cid:374) (cid:449)orth: clipping: people used to clip the edge of coins to collect precious metals to forge more coins. It rui(cid:374)ed (cid:373)a(cid:374)y s(cid:373)all states as people did(cid:374)(cid:859)t ha(cid:448)e faith i(cid:374) the (cid:272)urre(cid:374)(cid:272)y, so (cid:449)orkers (cid:271)ega(cid:374) to refuse to getting paid in coins for their wages. They preferred being paid in goods such as chickens and potatoes, which made hard for governments to collect taxes, shutting down many institutions. Inflation rate: 325 million : exchange rate rose form 9 marks to the us dollar to 4. 2 billion marks to us dollars.