HistoricalBritain · 1720
South Sea: change the certificate
- Face up, a government security. It is debt: a fixed promise to pay, held by a creditor. This is what a holder brought to the exchange.
- Turned over, a share. It is equity: a claim on ownership, worth whatever it fetches next. This is what the holder took away.
- A claim went in and a share came out. Exchanging one for the other changed what holders held. It did not simply erase the government's obligation, and a later fall in the share price was not the same amount of unpaid government debt.
A government claim goes into the exchange. A share in the South Sea Company comes out.
The company also participated in the trade in enslaved people.
A government-security holder in 1720 could hand over that certificate for South Sea Company shares. The new certificate went in the same drawer. The holder now had an ownership interest instead of the same debt claim.
When the shares crashed, the holder lost money, and a falling share price is not the government paying anyone back.
The company also participated in the trade in enslaved people. Its financing can't be separated from that business.
Turn the certificate over
Face up, a government security. It is debt: a fixed promise to pay, held by a creditor. This is what a holder brought to the exchange.
Turned over, a share. It is equity: a claim on ownership, worth whatever it fetches next. This is what the holder took away.
A claim went in and a share came out. Exchanging one for the other changed what holders held. It did not simply erase the government's obligation, and a later fall in the share price was not the same amount of unpaid government debt.
No share-price endpoints and no present-day equivalent are approved for this episode, so none appear. The South Sea Company also held a right granted in 1713 to supply enslaved people to Spanish colonies; that is recorded here and in the source text, and it is not drawn. The engraving reference in the source list is a late-18th-century print after Hogarth, not an image made during the 1720 event and not evidence for any 1720 price.
Sources
- Collection record PAG6946, Representation of the Fishery of Great Britain — Royal Museums Greenwich. The company-history paragraphs of the catalogue description, covering the 1713 right to supply enslaved people to Spanish colonies and the 1720 exchange of government stocks for company shares. Only the year is used for the boom and collapse, not a purported exact daily timeline. Museum image permissions are separate from permission to cite the catalogue's factual description.
- An Emblematic Print on the South Sea, after William Hogarth, object 91.1.56 — The Metropolitan Museum of Art. Artwork Details: date, attribution and the Public Domain label. A reference for engraving texture and layout only, with date and attribution carried on any reuse. A late-18th-century print, not an image made during the 1720 event, and not evidence for any 1720 price or a licence to repeat historical prejudice.
These historical figures stay separate from the running debt comparison. Source review recorded: 2026-09-13.