“Charging Bull,” a statue by Arthur Di Modica located in the financial district of New York City, March 2020
17 June 2020
When the stock market is rising and the prices of stocks generally are going up, we call it a bull market. When it’s going down, it’s a bear market. But why do we associate bulls and bears with financial markets?
The literal senses of bull and bear, referring to the animals, have fairly straightforward etymologies. The form bull first appears c. 1175 in the Ormulum (Oxford, Bodleian Library Junius 1):
Forr bule lateþþ modiliᵹ & bereþþ upp hiss hæfedd.
(For the bull acts proudly and bears up his head.)
The Ormulum, a work of biblical exegesis, was composed and copied in Lincolnshire, an area that had been under the Danelaw—the area of England ruled by the Vikings during the ninth and tenth centuries—and the work contains numerous words and phrases of Old Norse origin. The title, in fact, is from the Old Norse orm, meaning worm or dragon, and was the name of the author, Ormin, a common name in the area. It is thought that bull may, therefore, be from the Old Norse bole. But the root is found in many Germanic languages, and Old English has bulluc, the source of the present-day bullock, as seen in an Old English gloss of the Latin Liber scintillarum (Book of Sparks), a collection of maxims and adages:
Salomon dixit melius est uocare ad olera cum caritate quam ad uitulum saginatum cum odio.
betere ys geclypian to wyrtum mid soðre lufe þænne to bulluce gemæstum mid hatunge.
([Solomon said] it is better to call for herbs with true love than for the fatted bullock with hatred.)
Bulluce here glosses the Latin vitula, or calf. So, bull may instead be from an unattested Old English root *bulla. Or it could be from both that and the Old Norse word. In any case, it’s from a Proto-Germanic root.
Bear is even more straightforward. It comes down to us from the Old English bera. From the poem Maxims II:
Cyning sceal on healle beagas dælan.
Bera sceal on hæðe, eald and egesfull.
Ea of dune sceal flodgræg feran.(A king in his hall must deal out rings.
A bear on the heath must be full-grown and fearsome.
A river must flow downward, flood-gray.)
But compared to the literal meaning of the words, their association with speculative ventures is relatively recent. This association goes back to the sixteenth century and the reign of Elizabeth I and an adage warning not to sell the bear skin before one has caught the bear—akin to the present-day adage of don’t count your chickens before they’re hatched. The adage appears in a 1567 letter from Nicholas Throckmorton to William Cecil in which Throckmorton opined on the possibility of granting some liberty to Mary, Queen of Scots and on whether they could seize the property of her husband, Lord Bothwell. Bothwell had been accused of murdering Mary’s previous husband, Lord Darnley, and had fled the country. It’s clear from the letter that the phrase was one already in use:
For my demand for her [i.e., Mary, Queen of Scots] enlargement: the lords could not resolve, as it “depended upon accydentes: ‘Albert’ (sayd he) ‘for myne own parte, I coulde be contented yt weere undelayedlye.’” To my demand for her “condycion and estate after Bodwells apprehencion and justefyinge”: he aunswered ‘That theye coulde not marchaundyze for the beares skynne before they had hym’!
It also appears in a 1577 translation of Francis de De Lisle’s A Legendarie:
These two good commissioners being arriued in Scotland, began in their owne fancies to make partition of the gentlemens lands, and selling the beares skinne which yet they had not taken.
Shakespeare even uses a variation on the phrase in Henry V, 4.3, written c. 1600. The king addresses the French herald who has come seeking the English surrender just prior to the Battle of Agincourt:
I pray thee beare my former Answer back:
Bid them atchieue me, and then sell my bones.
Good God, why should they mock poore fellowes thus?
The man that once did sell the Lyons skin
While the beast liu’d, was kill’d with hunting him.
Here Shakespeare is taking a phrase that would be familiar to the audience and changing the bear to a lion, to make it more fitting for the royal Henry.
Up to now, bearskin was simply associated with prematurely forecasting success in some venture, but in the opening years of the eighteenth century it became associated with the stock market. In financial markets it referred to what we now call selling short or shorting an investment. That is, selling a security that one does not yet own at today’s price for delivery at a later date, with the expectation that the price will fall in the meantime, allowing one to purchase the stock prior to delivery at a lower price and thus making a profit.
Bearskin was used by many writers, as a derogatory term and in arguments for financial reforms. Notably, Daniel Defoe was particularly fond of the metaphor. One such early use is from Defoe’s 1705 Dyet of Poland:
For Bear-Skin Places, Chaffers with the State,
Secures the Cash, and leaves the rest to Fate;
Enricht with Fraud, in Trick, and Cheat grown Old,
And Places Bought on purpose to be Sold.
Another poet that uses the phrase is Arthur Maynwaring, in his 1714 satire “Prologue”:
Our Satyr falls
On such alone as Sin with the Walls.
The Bearskin Merchants are the Men we rally,
And leave good Covent-Garden for Change-Alley;
Where Sober Cit to bite his Bubbles comes,
And gets by Paper, and false News, his Plumbs.
Where Widows weep, and Orphans sue in vane,
The Miser thinks of Nothing but the Chain;
And All is Honest, All is Fair, that’s gain.
And there is Defoe again; this time in his 1719 The Anatomy of Exchange-Alley:
Then let you Citizens of London have a care of a Bearskin-Court, and a Stock-Jobbing Ministry, when Exchange-Alley shall be transpos’d to the Exchequer, and the States-men shall make a Property of the Brokers.
There is also News from Hell, written by a Mr. Chamberlen in 1721 after the collapse of the South Sea Bubble, which ruined the British economy:
Then Merchants did not seek each other’s Fall,
Nor sell the Bearskin, or for Premiums call,
But from abroad their well-got Riches brought,
In Ships with Spices, and with Diamonds fraught.
And Defoe again, creating a fictional account book in his 1727 The Complete English Tradesman:
By Tim. Bearskin for 500 1. S. Sea Stock, transferred to me this day at 117½
Finally, we have this from November 1763 in The St. James Magazine:
Some mischeif, to one’s utter ruin:
Contriving, scratching their dull pates,
To chouse men out of whole estates;
Selling the bearskin; making bargains
Of several pounds: yet han’t three farthings,
They want a thorough reformation:
Make me some small consideration,
And let the pillory keep its station.
By 1718 we also see the plain bear to refer to someone who shorts an investment, as well as the use of bull to refer to someone who goes long on an investment (i.e., speculates that the price will rise). From Susanna Centlivre’s 1718 play A Bold Stroke for a Wife:
SECOND STOCKBROKER: Are you a Bull or a Bear to day, Abraham?
THIRD STOCKBROKER: A Bull, faith,—but I have good Putt for next Week.
This sense of bull develops simply as an alliterative counterpart to bear and bearskin. Two powerful animals beginning with the letter < b > representing powerful and competing market forces.
So, in the eighteenth century an old Elizabethan maxim was transformed into the bulls and bears of the financial markets that we know today.
Sources:
Centlivre, Susanna. A Bold Stroke for a Wife. London: W. Mears, 1718, 36.
Chamberlen. News from Hell: or a Match for the Di[recto]rs. London, 1721, 2. Eighteenth Century Collections Online.
Defoe, Daniel. The Anatomy of Exchange-Alley. London: E. Smith, 1719, 61. Eighteenth Century Collections Online.
———. The Complete English Tradesman, second edition. London: Charles Rivington, 1727, 49. Eighteenth Century Collections Online.
———. The Dyet of Poland. London, 1705, 50. Eighteenth Century Collections Online.
de Lisle, Francis. A Legendarie Conteining an Ample Discovrse of the Life and Behauiour of Charles Cardinal of Lorraine, and of His Brethren, of the House of Guise. (translation from French). 1577, E.viii.
Dictionary of Old English: A to I. University of Toronto, 2018, s.v. bulluc.
Lloyd, Robert. The St. James Magazine, vol. 3. London: G. Kearsly, 1764, November 1763 issue, 161. Eighteenth Century Collections Online.
Maynwaring, Arthur. “Prologue.” Original Poems and Translations. By Several Hands. London: Benjamin Bragg, 1714, 46. Eighteenth Century Collections Online. (This edition is anonymous, but Maynwaring is credited with the poem in a 1715 collection of his works.)
Middle English Dictionary, University of Michigan, 2018, s.v. bole, n.(1).
Oxford English Dictionary, second edition, 1989, s.v. bull, n.1 with 1993 draft additions; bullock, n.
———, third edition, September 2009, s.v. skin, n.; March 2020, s.v. bear, n.1, bearskin, n.
Shakespeare, William. The Life of Henry the Fift. First Folio Text, 1623. Washington, DC, Folger Shakespeare Library, STC 22273 Fo.1 no.05, 87.
Throckmorton, Nicolas. Letter to William Cecil, 1 September 1567. In Calendar of the State Papers Relating to Scotland and Mary, Queen of Scots, 1547–1603, vol. 2, 1563–1569, Joseph Bain, editor. Edinburgh: H.M. General Register House, 1900, 392.
Photo credit: Arthur Henkelman, March 2020, Used under CC BY-SA 2.0 license.