Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1868-12-06
THE MIssHssIPPI BUBBLE.
The Story OF John LAWS Great
Speculation.
One of the Biggest SNIndIss of
amy Age.

From the Cincinnati Commercisl.l
The operations, equally gigantic and
nefarious, which the Erie railway clique
of spectators have lately consummated
in New York, render interesting a CON-
parison with some of the financial ma
MAS of former days. Among these the
most prominent place must be assigned
to the Mississippi scheme, which over
ran France with the wildfre of specula-
ton in 1719--'20, and which owed It's
origin to the fertile brain of John Law.
This shrewd and intelligent Seotehman,
then son of an Edinburg goldsmith, was
gifted with personal address, eloquence
and charm of countenanee well adapted
to secure success among people so SEN
sitive to gentlemanly attractions as the
French. At the age of twenty four he
left England for the continent, and in a
few years lived successfully in Amster-
dam, Paris, Genoa, Florence, Venice,
Naples and Rome. His patrimony being
reduced By free and costly style of liv-
ing, he devoted himself to the gaming
table, where, by an expert calculation of
chances, he won steadily, and often very
large sums. Saint Simon tells us in his
memoirs that Law did not cheat at cards,
but that his superior clearness, quick
combination, easy grace and magnani-
nous coolness, gave him continual ad-
vantage over the hot competitors who
were blinded BY the passion of play.
After living, for some years, the life of
an adventurer, Law betook himself to
higher game. The mysterious power of
credit, the function of specie as basis
of all financial operations, and the in
definite capacities of paper as a repre-
sentative of value, absorbed and fasci-
mated his scheming mind. He composed
a work entitled Considerations on
Money and Trade, and offered to his own
countrymen, the Scotch, his first brilliant
scheme of land bank, which vas 20
enrich the landlords while strengthen
ing the credit of the State. These terri
torial notes, secured upon landed estate,
were the germ of the /" Credit Fonctei"
in our day. But Scotland proved too
canny customer for so magnificent a
scheme. The Parliament passed reso-
luton that, to establish any kind of paper
credit so as to force it to pass, was an i'm
proper sxpedient for the nation. Wise
and wholesome conclusion, in which we
have to lament that all other nations,
then and since, did not concur
Bafiied in the hope Of launching his
great credit scheme at Edinburg, Law
established himself at Paris. The time
was. favorable. Louis XIV, the great
monarch, had just died, leaving to his
people a magnificent inheritance of
glory-and of debt Trade was pros
trated, the government finances we're in
,,ssrder, corruption and population, from
the highest Offices of the State down to
the lowest, having brought the treasury
to the verge of bankruptcy. The Duke
of Orleans vas regent, man who hated
business, and in whom Law had found
opportunities to inspire respect for his
financial ability and wisdom Early in
1716, royal edict granted to Law and
his brother the right to establish bank,
with a capital of six million livres, whose
notes were made receivable for taxes, and
redeemable at sight by all depositaries
of the royal revenues. Soon after the
innumerable finance Offices of the state
became so many branches of Laws Royal
Bank. He made all his notes payable
in the same coin in which they were
issued and, as the government was con-
stantly debasing the coinage, in its shifts
to meet expenditures, this gave at once
to Laws notes an immense advantage.
In fact, they soon appreciated to pre-
MUM of fifteen per cent, as compared
with specie while the billets detat of the
government, issued for the debts Of the
extravagant Louis XIV, were at dis
count of seventy to eighty per cent. The
credit of Laws bank soon extended over
France. The Regent, who saw with
wonder the success of this banking
scheme, gradually conceived the fatal
idea that paper money which could so
aid metallic currency could wholly su-
persede it. Law, whose scheming brain
never relaxed, proposed to the Regent a
grand plan for the colonization Of Loui-
siana, which had become French pos
session thirty years before. This terri
tory then included not only the present
State Of that name, but the immeasurable
surface watered by the Mississippi and
its tributaries, including the ground on
which Cincinnati now stands, and stretch
ing westward without boundary, while
to the north it reached to the very from
tiers of Canada.
By way of bait to the French govern
ment to grant an exclusive charter to the
Mississippi Company, Law agreed to re-
ceive at par in subscription to its stock
of one hundred millions, the deprecated
notes of France, then fallen to discount
of seventy per cent He also undertook,
if the interest Of four per cent were
promptly paid, to raise this deprecated
paper to par. An Paris declared that j