The apogee of the Company had been reached: from this time its downfall was rapid. The Stock fell, and fell. The aid of the Bank of England was invoked, but it came too late; goldsmiths and brokers began to abscond. On December 12, the House of Commons ordered that the Directors of the South Sea Company should, forthwith, lay before the House an account of all their proceedings; and, on Jan. 4, 1721, a Secret Committee of the House was ordered to report upon the Company. Then Knight, the cashier of the Company, absconded; and a reward of £2000 was offered for his apprehension. On Feb. 15, the Parliamentary Committee made their first report—and a pretty one it was—bribery all over the place, and especially among the members of the Government. The bubble was pricked and thousands were ruined. Certainly, the fortunes of those directors, who had any, were seized for the benefit of the swindled, and only a small percentage of their wealth was allowed them for their subsistence. Finally, it was settled that the £7,000,000 which the Company stood pledged to pay over to the Government, should be remitted, and every Shareholder should receive £33, 6s. 8d. on £100 Stock: all else being irretrievably lost. Over the misery entailed on the avaricious public who were gulled, it is best to draw a veil, and use the episode as a warning.
Swift wrote a poem 60 verses long, on The South Sea Project, 1721, from which I extract the following:
“There is a gulf, where thousands fell,
Here all the bold adventurers came,
A narrow sound, though deep as Hell,—
’Change Alley is the dreadful name.
Nine times a day it ebbs and flows,
Yet he that on the surface lies,
Without a pilot, seldom knows
The time it falls, or when ‘twill rise.