Born of Boom and Bust
In William Hogarth’s engraving of the South Sea Bubble, chaos reigns in the wake of widespread financial ruin.
Under a turbulent sky, a city is going mad. A public square teems with people gambling, picking pockets, beating and whipping each other. Overhead, wolves slink around.The city is recognizable as London—that’s Guildhall on the left and St. Paul’s Cathedral in the background. But in every other respect the natural order of things is subverted. Buildings run helter-skelter through space, arranged in multiple, off-kilter perspectives that wrench the rules of artistic geometry. In the left background, a balcony swarming with women tilts crazily downward, its vanishing point impossibly high in the sky, different from that of the building to which it’s attached. The base of the monument to the right answers to another set of rules; the structures facing it, to still others.
What plays out before us is grim fantasy in the guise of a genre scene. At the center, the crowd hauls a giant wooden lever that turns a creaking merry-go-round. Satan, flames spewing from his mouth, presides over the pandemonium, while at bottom center a naked, supine figure lies strapped to a wagon wheel.
We are looking at a satire on greed and human folly, specifically the South Sea Bubble of 1720. Stock in the South Sea Co. had soared nearly 650% as everyone from King George I and Isaac Newton to the poet Alexander Pope speculated that the trading and financial conglomerate would keep booming. Instead, the stock collapsed, wiping out investors large and small.
William Hogarth was a keen observer of the intense ferment of London life. He produced this engraving around 1721, when the wounds from the bursting of the bubble were still raw. Only 23 years old, he caught the mood of an entire city swept up in collective madness. When Hogarth was a boy, his father, a teacher who struggled to provide for his family, spent four years in confinement as a debtor. That memory, and the vivid contrasts between rich and poor in London’s booming economy, fired Hogarth’s lifelong contempt for greed.
Hogarth lays out his fraught tale using a mixture of symbol and allegory, much of it helpfully explained in the text he added at the bottom. On the left, Satan has turned Guildhall, the administrative seat of London’s government, into a meat market. He hacks the goddess Fortune to pieces and heaves chunks of her bloody flesh to the mob. At the edge of the crowd, a dwarf and a liveried footman pick the pockets of a schoolmaster. Some scholars have argued that the dwarf is Pope, who stood 4-foot-6. Next to the monument, a figure of “Vilany” (Villainy) flogs “Honour” as an elegantly clad monkey—long a symbol of folly and greed—bares Honour’s back for the lashing. Nearby “Honesty,” lashed to the wagon wheel, is about to be bludgeoned by “Self-Interest.”
Towering above them all is the merry-go-round. Its carousel animals are truncated horses, and the riders come from all walks of life: a prostitute, a minister, a shoeshine boy, an old hag with a hunchback, and a Scottish nobleman.
The merry-go-round represents the wheel of fortune. Into at least the 16th century, religious plays were staged across Europe with a carousel symbolizing how fickle luck and wealth are without divine grace. Three actors portraying kings would climb the wheel at the bottom, surmount it at the top and fall off it, while an actress representing the blind and capricious goddess of fortune turned a crank that propelled the wheel.
The goat at the top symbolizes Pan, the Greek god of chaos and panic. Below, a sign asks, “Who’l Ride” (Who Will Ride?). It is one of the keys to Hogarth’s image. During the 18th century, brokers—or “stock-jobbers,” as they were known—subdivided lottery tickets or shares of stock and rented them out to speculators, often for only a few hours at a time. (Day trading is not a modern invention!) The practice of renting tickets or stock was known as “riding” or “horsing.” No wonder, then, that all these carousel animals are truncated horses. The sign, then, doesn’t merely ask who will take a joyride on the merry-go-round. It is explicitly asking who will speculate in fractional shares of the South Sea Co. Hogarth’s answer is everyone.
Hogarth even suggests that the damage is irreversible: The monument at the right is modeled on the one put up to commemorate the Great Fire of 1666. But its inscription says it was “erected in memory of the destruction of this city by the South Sea,” while the goddess of Trade (legitimate industry) lies in the street at its foot, hollow-eyed and dressed in rags.
We know, of course, that the damage wasn’t irreversible. Later in the 18th century, Britain’s factories and financiers led the Industrial Revolution that helped create the modern world, and London went on to serve as Europe’s financial center well into the 21st century. Still, given the way stock markets have continued to boom and bust every few years ever since, Hogarth’s warnings about the greed and folly of the crowd remain as fresh as they were three centuries ago.
—Mr. Zweig writes the Journal’s ‘The Intelligent Investor’ column.