Then & Now

Have we learned nothing from 1720?

Oops!...We did it again.

Right now, in a hushed and august third-floor wing of the New York Public Library, a slew of archival prints, caricatures, and notes lampoon the pioneers and losers of the world’s first economic collapse. Dubbed Fortune and Folly in 1720, the free exhibit aims to ‘hold up a mirror to our own age.’ Swap in our recent mania for NFTs and cryptocurrency—and their epic rise and downfall—for the players and faddism of three centuries ago and, lo, history does seem to be repeating itself, but with actual jail-time for some principal architects this time.

The Villains

The star—and villain—of the 1720 crash was John Law (1671-1729), a Scottish gambler turned financier who introduced a new currency—paper money—via the Banque Générale in 1716. It would flood the market and became worthless by the end of 1720.

Law was never arrested for his involvement in the ruinous scheme, but others were. One document from 1723 reveals that the Constable of the Tower of London sought payment for expenses incurred while safe-keeping prisoners, including John Aislabie, the Chancellor of the Exchequer, who was convicted of “most notorious, dangerous, and infamous corruption,” and sentenced to five months in jail.

A portrait of John Law at the height of his powers, dressed in sumptuous attire and standing in a formal garden that recalls Versailles. In his hand, he holds a document whose Latin inscription translates as “I speak my words to the King”—a biblical phrase used here to signal the fact that Law has the ear of France’s regent, the duc d’Orléans. Image courtesy of the New York Public Library

A portrait of John Law at the height of his powers, dressed in sumptuous attire and standing in a formal garden that recalls Versailles. Image courtesy of the New York Public Library

Today’s chief villain, disgraced FTX founder Sam Bankman-Fried leaves a NY courthouse in December 2022 following his arraignment on criminal fraud charges after the spectacular collapse of his crypto exchange. (Photo by ED JONES/AFP via Getty Images)

Today’s chief villain, disgraced FTX founder Sam Bankman-Fried, leaving a NY courthouse in December 2022 following his arraignment on criminal fraud charges connected to the spectacular collapse of his crypto exchange. (Photo by ED JONES/AFP via Getty Images)

The Con Artistes

Many women actively participated in John Law’s bubble economies, including the French regent’s mistress, Parisian salon-hostess Madame de Tencin, and Lady Katherine Knollys, the niece of Queen Anne Boleyn. Knollys, who became Law’s common-law wife and accomplice, fled to Venice after his “system” collapsed.

A portrait of John Law’s common-law wife and partner-in-crime, Lady Katherine Knollys, made while she was on the lam in Venice, evokes a “Wanted” sign. Image courtesy of the New York Public Library

Rumors swirled that Caroline Ellison, Sam Bankman-Fried’s ex-girlfriend and business accomplice was planning to flee to Dubai. In the end, she pled guilty to seven counts of fraud and conspiracy that carry up to 110 years in prison. Image via Twitter / @carolinecapital

Rumors swirled that Caroline Ellison, Sam Bankman-Fried’s business accomplice and former girlfriend, was planning to flee to Dubai. In the end, she pleaded guilty to seven counts of fraud and conspiracy that could carry up to 110 years in prison. Image via Twitter / @carolinecapital

‘Tulipmania’ Returns

The immediate years leading up to the crash of 1720 had been a banner time: In France alone, excited speculation in New World trading companies generated such dizzying wealth—seemingly overnight—the words millionaire and nouveau riche were coined. But by the end of 1720, stock values had dropped so much that investors rioted in the streets of Paris. The boom and bust drew comparisons to Tulipmania, when demand for new and fashionable tulip bulbs first skyrocketed, then collapsed, between 1634 and 1637.

This etching dates from Tulipmania but was restruck during the boom and bust of 1720 as a reminder of “the folly of investing in faddish commodities.” Image courtesy of the New York Public Library.

An etching that dates from Tulipmania was restruck during the boom and bust of 1720 as a reminder of “the folly of investing in faddish commodities.” Image courtesy of the New York Public Library

Non-fungible tokens (NFTs), and especially Bored Ape Yacht Club NFTs, became highly sought-after collectibles in 2021–22. Like tulip bulbs of yore, their prices initially skyrocketed only to drop precipitously. The Collins Dictionary named NFTs its Word of the Year in 2021. (Photo by Jakub Porzycki/NurPhoto via Getty Images)

Non-fungible tokens (NFTs), and especially Bored Ape Yacht Club NFTs, became highly sought-after collectibles in 2021–22. The Collins Dictionary even named NFT its Word of the Year in 2021. But like tulip bulbs of yore, their prices initially skyrocketed only to drop precipitously. (Photo by Jakub Porzycki/NurPhoto via Getty Images)

The Losers

Famed mathematician and astronomer Sir Isaac Newton was one of the notable figures who lost big in the crash of 1720. He later mused, “I can count the movement of stars but not the madness of men.” A handwritten note of Newton’s authorizing the payment of stock interest to a financial agent is featured in the exhibit.

An uncut deck of cards from 1720 satirizes the bubble and its participants, featuring figures who lost their fortunes or else committed to foolish pastimes. Image courtesy of New York Public Library.

An uncut deck of cards from 1720 satirizes the bubble and its participants, featuring figures who lost their fortunes or otherwise engaged in foolish pastimes. Image courtesy of New York Public Library

NYC Mayor Eric Adams announced he’d take his first three paychecks in crypto. He reportedly lost over $1,000 as values declined. Image via TKTK

A contemporary deck might include NYC Mayor Eric Adams who announced he’d take his first three paychecks in crypto and reportedly lost $1,000+ as values declined. ©BFA 2023, Darian DiCianno

Gisele Bündchen (shown here with SBF) had substantial equity in FTX—shares that are now worthless. Image via TKTKTKT

Another card might feature Gisele Bündchen whose substantial equity in FTX is now worthless. ©BFA 2023, Joe Schildhorn

And Gwyneth Paltrow, who talked up wanting to form a crypto sisterhood with Reese Witherspoon and others. Image via TKTKT

And Gwyneth Paltrow, who talked up wanting to form a Crypto Sisterhood with Reese Witherspoon and others. ©BFA 2023, Zack Whitford

Justin Bieber bought a Bored Ape NFT for $1.3M in January 2022. It was worth just $69K by November. Image via TKTK

Or Justin Bieber, who bought a Bored Ape NFT for $1.3M in January 2022 that was worth just $69K by November. ©BFA 2023, Joe Schildhorn

And Kim Kardashian, who was fined fined $1.26M for not disclosing that she was paid for hawking the EthereumMax crypto token to her IG followers in June 2021. Image via TKTKTK

And Kim Kardashian, who was fined $1.26M for not disclosing that she was paid to promote a crypto token to her IG followers. ©BFA 2023, Jason Sean Weiss

The Skeptics

Amidst all the mania leading up to 1720, some did kept their heads about them. As Fortune and Folly in 1720 points out, critics, like French philosopher and novelist Montesquieu, skewered the era’s speculative economy as “an empire of the imagination.”

Montesquieu skewered his era’s speculative economy while others sought to capitalize on it. Image via WikiCommons

Montesquieu skewered his era’s speculative economy. Image via Wikimedia Commons, after Jacques-Antoine Dassier, Public domain

In June 2022, Bill Gates joked about how “expensive digital images of monkeys are gonna improve the world immensely” and declared that crypto and NFTs were “100% based on greater fool theory.” (Photo by Clive Brunskill/Getty Images)

Fortune and Folly in 1720 runs through February 19, 2023 at the NY Public Library. It’s free.

Arabella Bowen last covered Edward Hopper’s New York exhibit for Digital Party.

Lead image by xefstock via Getty Images