Editing Kingdom of Great Britain (section)

=====South Sea Bubble=====
{{Main|South Sea Bubble}}
Corporate stock was a new phenomenon, not well understood, except for the strong gossip among financiers that fortunes could be made overnight. The South Sea Company, although originally set up to trade with the Spanish Empire, quickly turned most of its attention to very high risk financing, involving £30&nbsp;million, some 60 per cent of the entire British national debt. It set up a scheme that invited stock owners to turn in their certificates for stock in the Company at a par value of £100—the idea was that they would profit by the rising price of their stock. Everyone with connections wanted in on the bonanza, and many other outlandish schemes found gullible takers. South Sea stock peaked at £1,060 on 25 June 1720. Then the bubble burst, and by the end of September it had fallen to £150. Hundreds of prominent men had borrowed to buy stock high; their apparent profits had vanished, but they were liable to repay the full amount of the loans. Many went bankrupt, and many more lost fortunes.<ref name="bubble">{{Cite book |last=Cowles |first=Virginia |url=https://archive.org/details/greatswindlestor01edunse |title=The Great Swindle: The Story of the South Sea Bubble |date=1960 |publisher=Harper |location=New York |url-access=registration}}</ref>

Confidence in the entire national financial and political system collapsed. Parliament investigated and concluded that there had been widespread fraud by the company directors and corruption in the Cabinet. Among Cabinet members implicated were the [[Chancellor of the Exchequer]], the [[Postmaster General]], and a Secretary of State, as well as two other leading men, [[James Stanhope, 1st Earl Stanhope|Lord Stanhope]] and [[Charles Spencer, 3rd Earl of Sunderland|Lord Sunderland]]. Walpole had dabbled in the speculation himself but was not a major player. He rose to the challenge, as the new [[First Lord of the Treasury]], of resolving the financial and political disaster. The economy was basically healthy, and the panic ended. Working with the financiers he successfully restored confidence in the system. However, public opinion, as shaped by the many prominent men who had lost so much money so quickly, demanded revenge. Walpole supervised the process, which removed all 33 company directors and stripped them of, on average, 82% of their wealth.<ref name="Kleer165">{{Cite web |last=Kleer |first=Richard |date=2014 |title=Riding a wave the Company's role in the South Sea Bubble |url=https://www.ehs.org.uk/dotAsset/380e0bd9-47d1-4878-87a1-6bfb013ad21c.pdf |access-date=16 January 2020 |website=Economic History Society |publisher=University of Regina |page=2}}</ref> The money went to the victims. The government bought the stock of the South Sea Company for £33 and sold it to the Bank of England and the East India Company, the only other two corporations big enough to handle the challenge. Walpole made sure that King George and his mistresses were not embarrassed, and by the margin of three votes he saved several key government officials from impeachment.<ref name="bubble" />

[[File:Houghton Hall 01.jpg|thumb|upright=1.35|Walpole's [[Houghton Hall]] ]]
Stanhope and Sunderland died of natural causes, leaving Walpole alone as the dominant figure in British politics. The public hailed him as the saviour of the financial system, and historians credit him with rescuing the Whig government, and indeed the Hanoverian dynasty, from total disgrace.<ref name="Kleer165" />{{Sfn|Marshall|1974|pages=127–130}}