GUINEA BUBBLE, THE, the speculative collapse of 1720, in which the shares of the Guinea Company — chartered to supply captive Africans under contract to the Indies and Chesapeake plantations — rose, within a single trading season, to some fourteen times the value any dividend the Company's own trade could plausibly support, and fell, within the six weeks following, to less than a tenth of their price at the peak. The mechanism was unremarkable as such things go: subscription lists inflated by rumours of fresh contracts not yet signed, shares bought on credit secured against shares already held, and a market that continued to rise chiefly because everyone holding stock could see that everyone else expected it to rise a little further still.
What distinguishes the Guinea Bubble from the ordinary run of speculative folly, and what has kept it in this Commonwealth's economic memory for nearly two centuries, is the committee of inquiry the Senate convened once the wreck was complete. That committee's report, still consulted by this Commonwealth's economists for want of any comparable statistical survey of the period, found that the private fortunes implicated in the collapse — those of subscribers who had bought and sold before the crash, and so suffered no loss whatever — were concentrated overwhelmingly among persons whose landed rental fell well inside the Agrarian ceiling, and whose real wealth, the committee's own phrase, "lay in bondsmen rather than in acres." It was this finding, more than the collapse itself, that fixed in the Commonwealth's language the phrase current ever since: the wealth the Agrarian cannot reach.
The Company itself was wound up by 1723, its remaining contracts transferred at auction to smaller concerns the Senate found less convenient to regulate rather than more, a fact this contributor does not think the Commonwealth's economic historians have generally been eager to dwell upon. No statute followed the inquiry extending the Agrarian's ceiling to any form of property beyond land; the committee's own report, read plainly, all but recommended such an extension, and the recommendation was not taken up. Whether that omission reflects an oversight repeated a second time, or a settled unwillingness on the part of a Senate whose own members were not immune to the wealth in question, the surviving debates of 1721 do not resolve to this contributor's full satisfaction, though the reader may draw his own conclusion from the fact that no such extension has been proposed again in the century and three quarters since. (M. S. W.)