Monday, February 16, 2009

An Old Dutch Painting: How
Economic History Repeats Itself

As the home of the first multinational corporation -- the Dutch East India Company or VOC, established in 1602 and which was also the first firm to issue stock -- the Netherlands has long experience of investment manias.

Its 17th-century art and literature routinely included reminders to not let selfish desires distract people from their duties.

The paintings of exotic tulips and overflowing fruit bowls that reflected the opulence of the Dutch Golden Age were often framed by insidious symbols of the inevitability of death, to show material things do not last.

In Hendrick Gerritsz Pot's famous painting, "Flora's Wagon of Fools," weavers drop their looms to join the goddess of flowers in a doomed quest for riches, reflecting concern that work was being supplanted by idle and illusory routes to wealth.

"These paintings were a warning -- a moral reminder -- to watch what you are doing: since there will be the inevitable moment of death," said Pieter Roelofs, a curator at the Rijksmuseum in Amsterdam.

"So you can try to be the best in your field and make as much money as you can, but when you are faced with judgment you won't be credited for your wealth but how you acted in the broader social context."

When tulip bulb prices collapsed in 1637 and many people refused to honor contracts, it sent a shiver through a trading community that relied on trust, a wave of self-doubt similar to sentiments expressed after markets tumbled last year.
--from "Moral Rebound Finds Dutch Exploring Calvin"

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