The sun. [volume] (New York [N.Y.]) 1833-1916, 1892-09-18
ii SUN, SUNDAY. SEPTEMBER is. 1892.

LIE ~
Unfortunately for his fame. his errors proved
so calamitous that he 10 remembered only az
the greatest OF financial chsrlatans.
John Law was born at Edinburgh in 1871.
His father was q goldsmith. and. as was Gus
tomary with goldsmiths at that period. COM
bined with his trade the care OF moneys in
trusted to him. and many OF the functions now
discharged by bankers. John was well e1u-
Gated Mt Edinburgh: he is said to have dis
played grent proficiency In ~athematics and
especially in algebra His father died leaving
a moderate estate. and his son found himself.
when little more than n lad. possessed OF n
handsome face. agreeable manners and some
money. It was not strange that he should
hovo devoted himself to the pursuit OF pleas
urc. and rs London furnished more tempting
opportunities than Edinburgh for q young
man with such tastes. Law spent some
ycnrs In the English metropolis. His
prepossossing manners gained him friends.
but no was known chiefly by his skill
rs q gambler and by his intriGues will
women. As n result OF one OF his sue
cesses In gallantry. he fought u duel and
killed his antagonist. For this crime no
was sentenced to be hanged. and although
he was subsequently pardoned he had to seek
refuge on the Continent. In the meantime
the Bank OF England had been organized. and
its successful working undoubtedly attracted
Laws attention. After leaving England he
spent some time at Amsterdam and made q
close study OF tho famous bank Of that city.
which had been In operation for almost
u century. whose methods differed from
| those OF its English rival. Tho study OF these
institutions caused Law to arrive mt the con-
viction that by grasping the principles OF
finance and applying thom to the business
transactions OF the world Ito could achieve re-
suits far moro dazzling thnn from the most
thorough knowledge Of tho chances In faro or
| ecarti. His mind was essentially that OF the
inventor. and tho discoveries which ho be-
loved him self to have mado he was eager to
| impart to tho public. He returned to Scotland
and published q proposal for supplying tho
nation with money by means OF u parcr cur.
| rency, based not upon n deposit Of the precious
| metals. but upon mortgages on land. His ar
gument was that gold and silver had under
| Cone tremendous depreciation since tho dis
| covery Of America. and that land bv comInri-
| son was a security Of extraordinary stability.
He proposed. therefore. TINT commissioners
should be authorized to issue paper money to
| all who required 1t. to he secured by mortgages
to tho value Of two-thirds OF tho land. or 49,
sued for the entire value. upon tho lands being
| turned over to the Commission. Such II cur
yRntN. uC Sulu, ~ w -
ton to tho needs Of tho community. In other
words. IL any man wantod money and had the
lands to secure It. he could got as much as he
required. When no ono needed money there
would DO no demand. and mono would be
issued. Thus the currency would regulate
itself like Il safety valve. SO confident was
Law Of the superiority OF such n medium OF
circulation over gold and silver that lie ad-
vised q provision limiting tho premium on
rnper to ten rer cent. 1t is easy to see that II
this scheme had been accepted there would
have been an imitation In Scotland.
followed by a long period Of disastrous reac-
ton. Tho history Of the French nssiGnnts in
the Revolution would have been anticipated
in North Britain. There was no danger.
however. Of tho adoption Of Laws proposals.
The Scotch were already smarting from tho
results OF the Darion eX pedition. and they were
by no means inclined to any new ventures.
Discouraged by the apathy Of his country
men. Law resumed histravolso on the Continent
Of Europe. He visited most OF the principal
cities. studied the finances OF various coun-
tries. and investigated with especial caro- the
bankin. system in the few places where such
existed. Nor was his taste for ingenious theo-
rics allowed to lie entirely idle during these
years. At IL time when opportunities for spec
ulation could be found with difficulty. gam
UlluSu ~ i WoS NhO ohh NV
satisfied the love Of excitement and offered the
hope OF easy gain. 1t was then no discredit toa
man to earn his livelihood at cards. Law had
soon dissipated his patrimony. but his skill as
a player furnished him with the means of liv-
ing in luxury and accumulating a considera-
bio fortune. There can DO but little doubt that
he adopted n system for his play. MS lie did
later for his banks and commercial COM
panies. Most Of those whom he met played
recklessly. looking to luck for success.
Law studied tho chances OF cards. the
probabilities OF their combinations. and on
them staked his money. Tho result showed
that his policy WAS tho better one. The sci
ence OF tho chances rarely fails one who knows
enough to master it and has resolution
enough to follow it. In the great cities which
Law visited in his rambling career he became
known as o bold and successful gambler.
When he turned his steps toward Paris on the
accession otthe Duke of Orleans to the regency.
he had accumulated n fortune OF n million and
q half OF livrcs. q sum equivalent in purchas-
ing power to at least Il million and n half
dollars In our day. His mode OF life, however.
and his acquisition OF n fortune largo enough
to enable him to live with splcndor. had not
extinguished his ambition to r~enovate the
and industry Of tho world. The
condition Of Franco mt the death OF Louis NV.
VINO "olcO bNA - 'o" pH'ii " WV hali Il
century. The national Indebtedness was
vastly larger In proportion to tho resources Of
the country than is the present dobt Of France.
because tho universal stagnation o, industry
rendered 1t impossible to meet it.
In this situation Of affairs. Law. who had
made the acquaintance OF the Regent in u
| previous visit to Paris. offered to assist Franco
in her distress. to render her debt light by
making her people rich. to restore hcr com
msrcc. build up her industries. and mako tho
regency Of Orleans memorable as the begin
ming OF an c.a OF larger enterprise. increasing
wealth. and Astounding prosperity. His
projects were submitted not only by word Of
mouth. but in q series Of memoirs aud letters.
What was needed. he said. was credit. The
French were not yet lar removed from tho
primitive days OF barter. hut II II sound sys-
fam ~ credit cDull he pstnnlishnl ihn inuua-