Tulip Mania

This story starts with one of the many versions of the famous Persian legend of the handsome stone cutter named Farhad who was stricken with love for the princess of the land, named Shirin. Shirin chances upon him one day and decides that she likes him too. The king who loved his daughter could not refuse outright her request for marriage with Farhad, but instead puts the lad to an impossible task, to dig a 40 mile channel through the mountains. The young man toiled for long and reached midway, alarming the king who now understands that Farhad may succeed. So the King sends a plausible message to Farhad that Shirin is dead, and Farhad hearing this is overwrought with grief and kills himself. The story is beautifully translated here. What happens to Shirin is told differently in the two versions with Shirin killing herself in one and in the second, a prince called Khusru marrying her.

It is said that from each droplet of the dying Farhad’s blood, a scarlet tulip sprang up, making the flower an historic symbol of perfect love. Now with this background, let us go to the Turkey of the 14th century where Tulips were revered and cultivated. By the 14th century it was the most-prized flower of the Ottoman sultans. The letters which made up its name in Arabic (The tulip, ‘lale’ in Arabic script, is written with the letters ‘lâm’, ‘aleph’ and ‘he’) are the same as those that made up the name of Allah. Another reason mentioned is that when the glorious tulip is in full bloom, this beauty in due modesty bows its head before God. Note here that in ancient Turkey, the Tulip bloom had to be clear without blemishes. Later in this article you will see how the disfiguring of a Tulip raised its value.

People who have gone to Amsterdam or for that matter the Kuekenhof gardens there will know a bit about Tulips and many of course believe it is a native of Netherlands. It is not, it is actually native to Asia and Turkey. In the East, the tulips cultivation was started over a thousand years ago. It grew wild in Persia and near Kabul, the Mogul king Baber counted thirty three different species. When Suleiman the magnificent of Turkey embarked on his campaigns in the 16th century, his royal armor was embossed with a single tulip, 9” inches long. The shape that we see today was because the Turks bred them long and narrow from the ancient bowl shaped wild tulip. The botanical name for tulips, Tulipa, is derived from the Turkish word "tulbend" or "turban" worn around the fez, which the flower resembles. Iranians and Turks call the flower Lale (h).

The Ottomans introduced Tulips to Europe some time in the 16th century. Now Netherlands of course is a choice destination for emigrating Turks (Netherlands is actually an alternate destination to Germany. Germany is to Turks as Dubai is to Malayalees). The first record of Tulips in Holland is from 1562, where the first merchant to receive them had the bulbs roasted and eaten, under the impression that they were Turkish onions.

Chalres Iecluse a botanist planted the first bulbs, gifted to him by the Ottoman ambassador. It rapidly became popular and was coveted as a status symbol; much like pepper from Malabar in earlier centuries around Europe. The Dutch eventually went crazy over the flower and the prices climbed. Could a mere tulip bulb be worth $76,000? It can only be so if people are willing to pay that much for it and they were! All this may sound preposterous, but this is exactly what happened in Holland in the 1630’s.

By 1635, a sale of 40 bulbs for 100,000 florins (Guilders) was recorded. By way of comparison, a ton of butter cost around 100 florins and a skilled laborer could at the same time earn 150 florins a year. People were purchasing bulbs at higher and higher prices, intending to re-sell them for a profit. However, such a scheme could not last unless someone was ultimately willing to pay such high prices and take possession of the bulbs.

Why did the prices climb? It was all due to a virus that went wild!! After a time, the single color tulips contracted a non-fatal virus known as mosaic, which didn't kill the tulip population but altered them causing "flames" of color to appear upon the petals. The color patterns came in a wide variety, increasing the rarity of an already unique flower and this was termed ‘breaking’.

Trevor sykes the popular journalist, in his beautiful after dinner speech explains - A bulb which produced a single-colored bloom one year could get streaked the next and there was no way of predicting when or how this would happen. Dutch breeders tried to induce breaking by binding half a normal bulb with a half-bulb that had broken, which later research proved to be the most effective way of transmitting the virus. Rosen tulips were one of the most highly prized varieties and the most highly prized of them all was the Semper Augustus (See picture). By 1624 there were no more than a dozen Semper Augustus in existence. It was so rare that very few were traded, but it became a benchmark which dragged up the prices of all other tulips.

But in 1633, we have the first recorded instance of tulips being used as money, when a house in the town of Hoorn changed hands for three bulbs. Tulip trading happened in taverns, mostly in Haarlem, where the participants were quite frequently drunk. And sometimes the taverns doubled as brothels, which would seem about the perfect ambience for an unregulated derivatives market.

During the period 1634-1637, people abandoned jobs, businesses, wives, homes and lovers to become tulip growers. Stories are often told of how one person paid with twelve acres of land while still another gave a new carriage and twelve horses. The mania became fanaticism. A certain man who had paid for a bulb its weight in gold upon hearing that a cobbler possessed the same variety bought the cobbler’s for 15,000 florin and right before the cobblers eyes crushed the bulb he had just purchased beneath his foot to ensure that now he was the only person who possessed that particular variety. And as if that were not enough he then informed the cobbler that he would have been willing to pay ten times as much for the particular bulb. Upon hearing this, the cobbler became so depressed that he went up to his loft and hung himself from the beam.

The zenith came early in the 1636 winter, at an auction to benefit seven orphans whose only asset was 70 fine tulips left by their father. One tulip bulb, a rare Violetten Admirael van Enkhuizen bulb that was about to split in two, sold for 5,200 guilders, the all-time record. All told, the flowers brought in nearly 53,000 guilders.

By February 1637, tulip traders could no longer find new buyers willing to pay increasingly inflated prices for their bulbs. As this realization set in, the demand for tulips collapsed, and prices plummeted—the speculative bubble burst. The mania and its economic reasons & impact are still being studied by experts and vague (so it seems, to me) explanations have been provided. But naturally the persons in the finance industry do not think much about it or they would have learned from the Tulip mania!! Today many economic schemes (like the ones you hear of in USA today) are equated to it. Probably the real estate crash today & the dotcom crash of the 90’s in California could be comparable in some way.

While all this mayhem was taking place in Netherlands, what was the scene in Turkey?
John Mandaville says - But although tulips were still special in Turkey, in the 17th century they were certainly not considered something to throw one's fortune away on, as the foolish foreigners had. Not, that is, until the early 1700's, when what had happened in Amsterdam 100 years earlier occurred again in Istanbul, the tulip madness.

Tulips played an interesting role in Turkish history. The period in Turkish history 1718-1730 is called the "Tulip Era", under the reign of Sultan Ahmed III. This period signified as an era of peace and enjoyment was a time when tulips became an important style of life within the arts, folklore and daily life. Many embroidery and textile clothing handmade by women, carpets, tiles, miniatures etc. had tulip designs or shapes and large tulip gardens around the Golden Horn were sponsored and frequented by the rich elite.

Tulips defined nobility and privilege, both in terms of goods and leisure time. Tulip prices began to rise in the last decades of the seventeenth century and peaked in 1726-1727 before state intervention. This reflected the demand for the inflated value of the rare bulbs and escalating demands for flowers in the elite’s palaces and gardens. Books were written on how to grow Tulips.

An eighteenth century manuscript notes that the Sheik Mohammed Lalizare, official tulip grower of S Ahmed (1703-1730) counted 1,323 varieties. The standards set forth by the head gardener to Sultan Ahmed III specified that “the petals should look like a dagger or a needle. If the tulip has not these petal characters, it is a cheap flower. The tulip with the needle is the better of the two; if it has both needle point and dagger shape it is priceless.”

Mandaville continues in his article in the SARAMCO world magazine - These Tulip books fueled the fire and the tulip craze spread, with all the accompanying wheeling and dealing that one might expect. It was Amsterdam of 1637 all over again. And as in Amsterdam, the government finally had to step in to cool off the market. In 1726 the head of the palace flower gardens, our friend Lalezari, was ordered to call a general meeting of all city tulip dealers. At that meeting he announced that price controls were to be established and enforced. Each dealer was to list all of his varieties. Lalezari would set a price for each and that price was to be maintained in the market. Violations would be punished by confiscation of stock and the exile of the offending merchant. Orders to that effect went out from the city courts. The price freeze worked; at least, speculation died out.

The Tulip Era was brought to an end after the Patrona Halil (An Albanian bath attendant) revolt in 1730, ending with the dethroning of the Sultan. The rioters burned down the Tulip gardens all over the city. Soon Sultan Mahmut took over, executed Halil and banned Albanians in the city bath’s!!

Today, over nine billion flower bulbs are produced each year in Holland, and about 7 billion of them are exported, for an export value of three quarters of a billion dollars. According to the Netherlands Flower Bulb Information Center, the USA is the biggest importer of Dutch bulbs, and in a recent year, $130,000,000 worth of Dutch bulbs (at wholesale) were imported by US traders.

Through the oceans and lands, one set of those Tulip flowers in a pot reached America recently and found their way into our house on Valentines Day, Feb 14th 2009. The pictures you see are of those flowers….



Tulip trivia

-The ancient Turks used to brew a love potion from tulips
-The French became obsessed with the Tulip during the reign of Louis XIV, when women tucked Tulips into their underwear. The more expensive the tulip, the more important the woman!
-Tulips are related to the onion and are edible. The flower petals can be used in salads or to make wine, and the bulbs can be sliced and fried. In Japan they make a type of flour from tulips.
-Tulips are the only flower that continues to grow in the vase after being cut up to 3".
-There is no such thing as the very rare Black Tulip; they are actually very dark purple. Other than that Tulips come in virtually every color including green!
-The Tulip breaking virus, is a rare case of somebody coveting an infected or diseased living object!!
-The Semper Augustus exists no more, but can be found only in paintings.
-Red tulips denote an irresistible love, while yellow tulips indicate a hopeless, desperate love with no chance of reconciliation, so be careful of which you wear or present.

For further reading

Trevor Sykes - Australian finance journalist’s speech
Business week article
SARAMCO article
Investopedia article
Australian video
Turkish baths – See my earlier blog
From the beloved – Turkish airlines article.