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What Are The Origins Of The Terms 'Bull' And 'Bear'?

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From the Archives : Originally published April 12th, 2013
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Category : Gold University

 

 

 

 

Right now there’s much discussion about whether gold is headed for a bear market after its decade-long bull run. Time will tell, but the current debate may make you wonder how ‘bull’ and ‘bear’ entered the financial lexicon?

A bull is a boisterous, charging animal that throws its victim up in the air. A bear is slower, hibernates for long periods and is more likely to throw its quarry to the ground. Investopedia says these “actions are metaphors for the movement of a market. If the trend is up, it's a bull market. If the trend is down, it's a bear market.”

But the murky origins of the use of these terms suggest the explanation is probably not so straight forward.

One of the most frequently cited stories relates to bear skin jobbers in early 18th century London. In anticipation of falling prices, these middle men (or ‘bears’) sold their wares before the animals had even been caught - an early form of short selling. The contemporary proverb "don't sell the bear skin before you've killed the bear" highlighted the risks they ran.

This type of selling was also used by people involved in the South Sea Bubble, the share speculation mania that ruined many British investors in 1720. According to the Merriam Webster New Book of Word Histories, the scandal brought the term bear into widespread use.

Both bear-baiting and bull-baiting were popular blood sports at the time and from this it seems the bull was chosen to describe the opposite kind of trader. Just before the South Sea Bubble burst, poet Alexander Pope penned the lines: Come, fill the South Sea goblet full; The gods shall of our stock take care; Europa pleased accepts the Bull, And Jove with joy puts off the Bear.

In America, an attempt to corner the gold market in 1869 resulted in plunging gold prices and a stock-market panic. Reinforcing the symbolism, famous American cartoonist Thomas Nast portrayed dead bulls and a bear in a heap in front of a roped-off Wall Street with a sign reading This ‘Street’ is closed for repairs.

Today, New York’s renowned Charging Bull sculpture symbolises aggressive financial optimism and prosperity. Other notable sculptures include a bull and bear facing each other outside Frankfurt’s Stock Exchange (below).



Image: Metro Centric

 

 

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The story I heard came from the heart of the gold fields during the start of the New York bankers financing of the mining activities in the territory quickly added to the US as the state of California. From California historical marker # 269 in the hamlet of Mokelumne Hill:

Mokelumne is an Indian word, first applied to the nearby river. Earliest settlement at Happy Valley by French trappers. Gold discovered by discharged members of Stevenson's Regiment in 1848. Center of richest placer mining section of Calaveras County and one of the principal mining towns of California.

Corral Flat produced over thirty millions in gold. Sixteen feet square constituted a claim. The so-called French War for possession of gold mines occurred in 1851.

"Calaveras Chronicle" established in 1850. Fights between grizzly bear and bulls amused early residents. At one time headquarters of Joaquin Murieta. Town destroyed by fires in 1854, 1864, and 1874.

County seat of Calaveras County from 1853 to 1866.


(This is the same Calaveras County of the Jumping Frog fame.)
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I don't have any idea of the origin of the terms but just always assumed it had something to do with the once common form of entertainment of fighting bulls and bears.
Latest comment posted for this article
I don't have any idea of the origin of the terms but just always assumed it had something to do with the once common form of entertainment of fighting bulls and bears. Read more
samking73 - 4/30/2013 at 10:59 PM GMT
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