History Being Made

South Sea Bubble

The South Sea Company (officially The Governor and Company of the merchants of Great Britain, trading to the South Seas and other parts of America, and for the encouragement of fishing) was a British joint-stock company founded in 1711, created as a public–private partnership to consolidate and reduce the cost of national debt. The company was also granted a monopoly to trade with South America, hence its name. At the time it was created, Britain was involved in the War of the Spanish Succession and Spain controlled South America. There was no realistic prospect that trade would take place and the company never realised any significant profit from its monopoly. Company stock rose greatly in value as it expanded its operations dealing in government debt, peaking in 1720 before collapsing to little above its original flotation price; this became known as the South Sea Bubble.

Railway Mania

Railway Mania was an instance of speculative frenzy in Britain in the 1840s. It followed a common pattern: as the price of railway shares increased, more and more money was poured in by speculators, until the inevitable collapse. It reached its zenith in 1846, when no fewer than 272 Acts of Parliament were passed, setting up new railway companies, and the proposed routes totalled 9,500 miles (15,300 km) of new railway. Around a third of the railways authorised were never built – the company either collapsed due to poor financial planning, was bought out by a larger competitor before it could build its line, or turned out to be a fraudulent enterprise to channel investors' money into another business.

Groundnut Scheme

The Tanganyika Groundnut Scheme was a plan to cultivate tracts of what is now Tanzania with peanuts. It was a project of the British government. It was abandoned in 1951 at considerable cost to the taxpayers when it did not become profitable. Ground nuts require at least 500 mm (20 inches) of rainfall per year; the area chosen was subject to drought.

Ponzi Scheme

A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from existing capital or new capital paid by new investors, rather than from profit earned by the individual or organization running the operation. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme.

TR Omnishambles

The TR Omnishambles was a government scheme in 2013/14  to privatise most of the probation service in England and Wales by dividing it in the ratio 70/30 between commercial Community Rehabilitation Companies and a National Probation Service. The concept was borne principally of a political desire by the Conservative/Liberal Democrat coalition government to save money and reduce the size of the State. However, it proved totally unworkable and many Community Rehabilitation Companies went bust with investors incurring heavy losses. The resulting chaos and public outcry from several notorious murders led to expensive renationalisation by the subsequent Labour/Liberal Democrat/United Kingdom Independence Party coalition government in 2015.