Was there a market bubble in slave prices and what would have happened if it 'burst'

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jgoodguy

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The first question is was the increase in slave prices in the 1850s a bubble and the second is what have happened if the alleged bubble burst assuming no secession in 1860-early 1861.

A financial bubble is "an economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania or a balloon) is "trade in high volumes at prices that are considerably at variance with intrinsic values". It could also be described as a trade in products or assets with inflated values" A recent example is the Dot-com bubble (1995–2000) and United States housing bubble (as of 2007. The most earliest one recorded is the Tulip mania (top 1637).

In short, bidders of assets bid them up in a frenzy of speculation beyond what a reasonable return on their investment would be on unrealistic assumptions. Houses always increase in price, gold will never drop, get your dot come stock before it is too late, invest in tulip bulbs because everyone else is doing it.

This graph provides visual evidence of a bubble in slave prices.
ransom.civil.war.us.figure1.jpg
Ref Visually it appears to be a bubble. Coincidentally as it rises to a peak, the South seceded.

However had the South not seceded, then in 1860-1861 a surplus of cotton in England in both finished goods and raw cotton (also 1 and 2)led to a decline in cotton prices. Because slaves were primarily used for the production of cotton, a decline in slave prices would have been likely sans secession and the Civil War. Bubbles are driven by emotion and 'burst' for the same reasons. If a unrealistic expectation of cotton prices determined slave prices then slave prices would decline significantly. A significant decline in slave prices could have affected Southern Society because the wealth of the South was in slaves.

How would this decline affected a theoretical secession in late 1861 or 1862? Would it have been enough to prevent secession? Or the economic stress insured secession?

1. Was the slave prices in the 1850s and 1860s a bubble.
2. If a bubble, how would it have affected secession in late 1861 and 1862 had it burst.
 
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