As someone on HN pointed out recently, there’s a much better explanation for the tulip bubble than “speculators went crazy all of the sudden”. In a 2007 paper,

As someone on HN pointed out recently, there’s a much better explanation for the tulip bubble than “speculators went crazy all of the sudden”. In a 2007 paper, Earl Thompson argues that the extreme tulip bubble was formed because the Dutch government, in coalition with insolvent tulip speculators, allowed speculators to nullify tulip futures contracts, thus inadvertently enabling close-to-risk-free speculation in tulip futures (which, after the regulation, resembled options contracts to a much higher degree). Here’s an Economist article on the subject: https://www.economist.com/blogs/freeexchange/2013/10/economic-history https://www.economist.com/blogs/freeexchange/2013/10/economi... And Wikipedia has a summary here: https://en.wikipedia.org/wiki/Tulip_mania#Legal_changes https://en.wikipedia.org/wiki/Tulip_mania#Legal_changes