ine, and confiscation of all sums found exceeding that amount; a measure which could scarcely fail to sow distrust in the bosom of families, and to excite alarm in the public mind. Still the delusion prevailed. On the 23rd of February, a few days before the publication of this edict, the Royal Bank had been incorporated with the company, and the king not only remained guarantee of the banknotes, but gave up to the company all the profits made by the bank since December 1718, when the government had taken it into its own hands. Meanwhile, the manufacture of notes proceeded with so much activity, that, by the 1st of May 1720, paper-money had been fabricated to the amount of more than 2600 millions of livres, or nearly L110,000,000 sterling; whilst the specie in the kingdom was estimated at only 1300 millions of livres, or about L52,000,000 sterling. In this state of matters, Cardinal Dubois and M. d'Argenson represented to the regent that it had become necessary to equalize the proportion between the notes and the coin, either by reducing the value of the one to the extent of a half, or by doubling that of the other.

This extraordinary point was debated in council, where it was opposed by some of the members, amongst whom was the comptroller-general, who strenuously contended for letting matters remain as they were; but the majority being in favour of the proposition for lowering the value of the paper, it was decided accordingly; and, on the 21st of May 1720, an edict was issued, which, contrary to all sound policy, and even to the most solemn stipulations, reduced the value of the company's bank-notes one half, and fixed their actions or shares at 5000 livres. By this unjustifiable and fatal step, the whole paper fabric was destroyed in an instant, the notes lost all credit, and next day a man might have starved with 100 millions of paper money in his pocket. The consternation with which all ranks were seized was soon converted into rage, and it became necessary to station troops in different parts of the capital, to prevent the consequences to be apprehended from the fury and despair of the populace. Disorder and confusion reigned everywhere; seditious and inflammatory libels were posted up and distributed; and the life of the regent himself was threatened. Some conception may be formed of the distress of the people, when it is considered that at the time when the bank thus stopped payment, and the value of paper money instantly sunk to zero, not less than 2,235,085,590 livres, or upwards of L90,000,000 sterling in notes, were in circulation. Law was of course peculiarly obnoxious to popular odium, which he endeavoured in vain to allay by resigning into the hands of the regent his office of comptroller-general, on the 29th of May; but, though several times exposed to imminent danger, from the vengeance both of the parliament and the people, he remained in France until towards the close of the year 1720, when he withdrew to Brussels; and soon afterwards his whole property was confiscated, and his brother William sent to the Bastile.

Law arrived at Brussels on the 22d of December 1720, and, after waiting there for some time, in the vain expectation of being recalled to France, set out for Venice, which he reached early in January 1721; he then visited other places on the Continent, and, in October, arrived in England, for the ostensible purpose of pleading the king's pardon. He was at first well received, and visited by persons of distinction; but when it was discovered that the fallen financier was in a state almost bordering upon destitution, his friends began to fall off, and, of those who had known or perhaps courted him in his day of power, he could find none good-natured enough to lend him a thousand pounds. In a letter addressed to Mrs Howard, afterwards Countess of Suffolk, he calls that lady his "only friend;" an avowal which affords a striking instance of the instability of fortune, power, and friendship. After residing some years in England, this extraordinary man returned once more to the Continent, and closed his chequered career at Venice, where, on the 21st of March 1729, he died in a state but little removed from indigence, in the fifty-eighth year of his age. Soon after his death appeared the following epitaph, the point of which reminds us of the bitter jests which appeared upon the occasion of his fall:

Ci-gît cet Ecossais célèbre, Ce calculateur sans égal, Qui, par les règles de l'algèbre, A mis la France à l'hôpital.

We do not think that any great difference of opinion can now be entertained respecting the real character of Law's project; and indeed it seems to be generally agreed that, even if it had not been violently interrupted by the edict of the regent, it was too insecure in its principles to have proved permanent. The favourite maxim inculcated by Law, and upon which his whole fabric of the Mississippi system was reared; namely, that the power and prosperity of a nation increase in proportion to the quantity of money circulating therein, and that, as the richest nations have not specie sufficient to afford full employment to their inhabitants, this defect may be supplied by paper credit; involves a dangerous fallacy, even in the most restricted view that can be taken of its application, inasmuch as it implies that paper money may be issued with advantage to an almost unlimited extent, upon general security; and that its credit, or, in other words, its value, may thus be maintained without its being rendered convertible at pleasure into cash. But all experience has proved that this is absolutely impossible. When paper is in excess, in comparison with the total amount of gold and silver currency, it necessarily becomes depreciated; the prices of commodities experience a corresponding rise; the nominal value of the precious metals is increased in proportion to the amount of the depreciation, of which this increase is the only measure, and they disappear from circulation. All existing contracts and obligations are disturbed; debtors benefited at the expense of creditors; a spirit of reckless speculation and adventure is thus engendered; and, after a time, the crisis of revulsion and ruin arrives. Whenever the quantity of money in circulation is too great in propor-

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1 Even in this season of calamity, the French exemplified the indestructible gaiety of their national character, by sporting with their own misfortunes in jests and epigrams. The following hebdomadal record is, perhaps, unique amongst jeux d'esprits.

Lundi j'achetai des actions; Mardi je gagnai des millions; Mercredi j'embrassai mon ménage; Jeudi je pris un équipage; Vendredi je m'en fis au bal; Et Samedi à l'hôpital.

The Abbé, afterwards Cardinal, de Tencin, having had the principal share in Mr. Law's conversion, a service for which he was rewarded by the bishopric of Grenoble, is thus addressed by a malicious epigrammatist:

Foin de ton zèle séraphique, Malheureux Abbé de Tencin! Depuis que Laws est Catholique, Tout le royaume est Capucin. tion to the total amount of commodities to be circulated by it, depreciation is the necessary consequence, or, in other words, a proportional rise in the price of commodities. Money has no creative power, as Law seems all along to have imagined, and can never be in excess without endangering "the power and prosperity" of the nation where this is the case. His whole system, therefore, was built upon a sandy foundation, and, even if it had received no rude or sudden shock, would have fallen to pieces from its own insecurity and instability. At the same time, there is much truth in an observation of Mr Burke, in his Reflections on the French Revolution. "It is not true," says he, "that Law built solely on a speculation concerning the Mississippi; he added the East India trade, he added the African trade, he added the farms of all the farmed revenue of France; all these unquestionably could not support the structure which the public enthusiasm, not he, chose to build on these bases." He laid the best foundation that he could, perhaps the best which, in the circumstances, it was possible to lay; but the nation went suddenly mad, an event which he could scarcely have foreseen; the company was hurried onwards by the general frenzy; and when the delirium had reached its height, the regent was advised to issue the fatal edict, which levelled the whole fabric with the dust.

(See Œuvres de Law, passim; Histoire du Système des Finances, tom. i.; Pollnitz, Mémoires; Massillon, Mémoires de la Minorité de Louis XV.; Mémoires de la Regence de M. le Due d'Orleans, tom. i.; Richelieu, Mémoires, tom. iii.; Voltaire, Siècle de Louis XV.; Chalmers's Biog. Dict. art. Law; Wood, Life of John Law of Lauriston, Edinburgh, 1824.)