of minifters and courtiers, with a manly freedom, and fpeaks concerning the events which come under his notice, not as a Frenchman, but as a philofopher and citizen of the world. Facts are related with minuteness of detail, yet without tedious prolixity characters are drawn with ftriking features, and boldnefs of colouring; and the narrative is frequently enlivened with entertaining anecdotes. In fome parts of the work, indeed, the intrigues of courtiers, and the difputes of ecclefiaftics, are too circumftantially narrated to be interefting to the generality of readers; and, in many inftances, the detail is of a nature which reflects little honour either upon the prince or the nation; but even these relations may fuggeft curious and ufeful reflections to fuch as are difpofed to view the characters of men, and the incidents of ftate, with a philofophic eye.

We shall begin our extracts from this work with the following account of the rife and progrefs of the Miffiffipi bubble, which is too interefting and valuable to leave room for an apology on account of its length:

John Law was a Scotchman, the fon of a goldfmith of Edinburgh. Never did man poffefs, in fo perfect a degree, the power of calculating and combining; and he cultivated thefe talents, by following the bent of his inclination. He applied himself to every thing that related to banks, lotteries, and to the trading companies of London; he studied the means of fupporting them, of animating the hopes and confidence of the public, by keeping up their expectations, or by increasing their zeal. He penetrated into the inmoft fecrets of thefe matters; and increased his lock of knowledge till more from the new Company, established by Harley Earl of Oxford, for paying off the national debt. Having afterwards obtained the employment of Secretary to fome Agent of the Refident's in Holland, he made himself acquainted upon the fpot with the famous Bank of Amfterdam; with its capital, its produce, its refources; with the demands individuals had upon it; with its variations, its intereft; with the mode of lowering or railing its flock, in order to withdraw the capital, that it might be distributed and circulated; with the order that Bank obferved in its accounts and in its offices; and even with its expenditures and its form of adminiftration. By dint of reflecting upon the information he had acquired, and of combining fo many different ideas, he formed a fyftem which was admirable for its order, and the concatenation of the various operations which conflituted it: a fyftem founded at least as much upon the knowledge of the human heart, as upon the science of numbers; but from which good faith, equity, and humanity were totally banished, to make way for perfidy, injuftice, violence, and cruelty. And indeed the author of it was himself an unprincipled wretch, bound by no ties of morality or religion Having flain or murdered a man, he was obliged to fly from Great Britain; he brought away with him another man's wife, with whom he lived many years as if he had been his own. His avidity was infatiable, and it was to gratify this paffion, that all his extenfive combinations were made to concur. In that exhaufted state to which the war had reduced

N 4

reduced all the European powers, he forefaw that they would necef. farily endeavour to re-establish their finances; and he conceived greater hopes of fucceeding than ever, by the allurement of his fyftem, which was calculated to feduce any power that would not fcruple to prefer the speedieft method of exonerating itfelf, to that which was most honeft. The object of his plan, therefore, was neither trade nor the facility of levying taxes without diminishing them, nor the retrenchment of expences, nor the cultivation of the foil, nor the confumption of provifions, nor even the circulation of the fpecie. He had built up his fyftem with a view that a fovereign fhould pay his debts, not only without encroaching upon his profufion or his luxury, but alfo by attracting to himself all the gold and filver of his fubjects; and fuch was to be the illufion, that the fubjects thould give it up voluntarily; nay more, fhould be eager to bring it in, fhould infilt upon its being received, fhould confider it as a favour to be preferred; and that when they were rouzed from this dream, if they fhould find themfelves bereft of their property, they fhould not be able to lay the blame on any thing but their own avidity. A project of a molt alarming nature to the human mind, and which every other man, except this daring genius, would have rejected as a chimera, if it had fuggefted itself to him!

This fyftem confified of a Bank, the real capital of which was to be the revenues of the ftate, and the accruing capital fome unknown kind of commerce. This benefit being calculated to keep pace with the imagination in its increafe, was to be a wonderful spur to thofe gamefters who wished to partake of it, by means of fhares which were to be made out fucceflively, in proportion to the eagernefs of the parties.

" Thefe shares, in fact, which were at first few in number, could not fail of rifing to an enormous price, on account of their scarcity, and the rapidity of the circulation; this would not only facilitate, but even neceffitate the making of other fhares, and at an advanced premium.

This new paper, bringing the old into difcredit, would furnish an excellent mode of diftributing it; because the old paper would be received at par, but always with a certain proportion of money.

In order to engage perfons to get rid of this old paper, the value of it was to be made uncertain by frequent fluctuations; thus the poffeffors of it would be apprehenfive that it might become of no value in their hands: when it fhould be raised, one would readily convert it into fhares, to fecure the advantage; and when it should be lowered, one would fear that it fhould become lower fill.

The Bank, on the contrary, were to make all their payments in bills, whose value being invariable, would keep up the confidence in them, and would render them more negotiable, and preferable to fpecie.

The difcredit brought upon money would lower the intereft of it, and the prince was to avail himself of this reduction to make his loans, and thus difcharge part of his debts, without any difburfe ment; for the individuals, not knowing what to do with it, would bring it back to him.

If the individuals wished to lay out their money in more folid acquifitions, lands, provifions, and merchandize would increase, and confequently fo would the receipt of the taxes and the customs.

This phantom of fortune dazzling the eyes of every one, the feveral claffes of citizens, in their eagernefs for partaking of it, would intereft themselves in the keeping up of the Bank fo much the more; as a number of individuals, either more fortunate or more dextrous, neceffarily making enormous profits, would excite the general cupidity, nearly in the fame manner as the highest prize in a lottery keeps up the hopes of the adventurers, of whom the greater part mut nevertheless be lofers. Now, what fort of competition would there not be in this inftance, where every one would be certain of winning, by increafing the dividends à-propos ?

Let this illufion be kept up only for a few years, and the Sovereign will have paid off all his debts, and will have drawn into his coffers, the greateft part of the fpecie of his own, and even of other kingdoms.

Such were the axioms and corollaries of Law's fyftem: an infernal theory, deduced certainly from facts, and which he had never ventured to confider coolly in all its horror: let us fay more, a theory that was not even to be conceived; but the Regent and he, hurried away, in fpite of themselves, by the rapid motion of this political machine, were obliged to yield to its impulfe, till it broke to pieces by its own efforts.

However this may be, the author of this plan, whether more or lefs digested with refpect to its confequences, perceiving that it could not be carried into execution in any ftate, except where the Sovereign enjoyed abfolute authority, confidered France as the kingdom most fit for his defign. Befides, he knew the people; that they were fond of novelty, that they adopted it without confideration, and gave themfelves up to it with a kind of frenzy. It has been afferted, that he first propofed his fyftem to Lewis XIV. who, notwithstanding his being in want of fuch a fcheme, upon the bare expofition of it, rejected it with a kind of abhorrence. The author was not difconcerted, but produced it again to the Duke of Orleans. That Prince, more determined, more enterprifing, and certainly lefs fcrupulous, confidered it as very useful to his views; he was moreover preffed by circumitances; he wished to avail himself of the fhort time he had to govern, to remedy the evils of the ftate, which required a neceffary crifis. He therefore adopted this fyftem; he would not allow himfelf to think of the violent convulfion into which he was going to throw the state, and flattered himself, that his genius would be able to put a stop to its effects, whenever they fhould become too fatal. Nevertheless, as he was not the abfolute mafter, and that he was obliged to act with a great deal of caution, he adopted it only flowly, and by degrees.

At firit he contented himself with permitting Law to establish a Bank, in order to accullom the people by degrees to fuch a title, and to fuch an establishment. It was prefented under an appearance of public utility, and it would really have been attended with very great advantages, if it had been confined to the functions fpecified in the pdict which fet it on foot,

The

The year following, in order to give this Bank a credit, which was to be answerable to the more extensive undertakings it was to embrace, a decree of Council was issued, which ordered all those who had the management of the Royal treasure, to receive, and even to discharge the bills without discount. By this decree, full of artifice, under the appearance of fimplicity, the Bank was made the repofitory of all the revenues of the King. This was the first step towards that ideal fortune it was to make: it immediately fixed the interest at feven and an half per cent.

Some time after, a trading Company was created, under the title of the Western or Mississipi Company. Its object was the planting and culture of the French colonies of North America. The King gave to this Company all the lands of Louifiana, and permitted French, as well as foreigners, to be concerned in it, by taking fhares of it, part of the value of which might be furnished in bills of ftate, which loft from fifty to fixty per cent. upon the spot. How was it poffible to refift fuch a bait, more efpecially as the country was reprefented as a Peru, more fertile in gold than that of the Spaniards! Even the Parliament was taken in, and made no fcruple of registering. They yet faw nothing in this, but what might be useful to the ftate.

In 1718, the Bank made further advances. It was announced under the title of Bank Royal, by a declaration of his Majefly, which fignified, that the King had reimburfed in money the capitals of thofe perfons who had fhares in the Bank, which they had only paid in bills of ftate, and that these capitals had been converted into shares of the Western Company; and in a word, that the King was become fole proprietor of all the fhares of the Bank. Mr. Law was appointed Director to it, under the authority of his Majesty, and the orders of the Regent.

Three things were the refult of this declaration: one, that the Monarch, being thus transformed into an univerfal Banker of his kingdom, the whole French nation, the firit Lords and Princes, who are ever the apes of their mafter, were not ashamed to exercise the fame trade, fo that they all became Financiers, Brokers, and Ufurers. The fecond refult was, that the public, aftonished that the King fhould buy up these shares of the Bank at 500 livres in fpecie, when they had originally colt no more than 500 livres in bills of the ftatethat is to fay, reckoning the difcredit of these bills, about 170 livres ta in real value-conceived a very high opinion of them, and contended zealously to obtain them. The lait refult was, that the fhares of the Western Company, being preferred by the Clerks of the Bank to the reimburfment of them in fpecie, were reckoned an excellent acquifition, fo that the rife of them kept pace with that of the fhares of the Bank. The Parliament, fince the laft Bed of justice, had opened their eyes, and interfered no more in matters of finance. At another time, the want of the legal form of registering in this court, would have alarmed the Parifians; but fuch was now the delirium, that they faw nothing but the phantom of fortune which deluded them, and which was realized to their eyes. This enthufiafm foon reached the pra

Upwards of twenty pounds.

+ About feven pounds.

vinces,

vinces, and, to gratify the eagerness of the people, private offices of the Bank were established, by decree of Council, in the cities of Lyons, la Rochelle, Tours, Orleans, and Amiens. The Miniftry did not dare to establish any in the cities that had Parliaments, because they forefaw that thofe companies would oppofe them. Other cities were fufpected of oppofition, and as thofe cities did no feem to care about the matter, the Ministry were fearful of diffatisfying them, and of occafioning, on their part, an expoftulation which might diffipate the general illufion. Lifle, Marfeilles, Nantz, Saint Malo, and Bayonne, were diftinguished by this prudent exclufion.

The fame decree of Council forbad the making of any payment in money above the fum of 600 livres 1, and by a claufe which reftrained commerce even in its detail, and chara&erifed the littleness of the views and means of the legislature, the bafe coin and copper money were not to be given or received in the markets above fix livres §, unless it was to make up odd money. The evident defign of this arrangement was to render the Bank bills more neceffary, and thus to inforce the circulation and multiplication of them.

In effect, an order was foon iffued to make out one hundred million of Bank bills. Thefe, faid the decree of Council, cannot be subjet to any diminution, as the fpecie is; inasmuch as the circulation of the Bank bills is more feful to the subjects of his Majesty, than that of the Specie of gold and filver, and that they deserve a particular protection, in preference to the coin made of materials brought from foreign countries.

A few months after, there appeared prohibitions to make payments above ten livres in filver, and three hundred livres + in gold. Thus gold and filver being debafed by thefe fucceffive and declared diminutions, were in fome fort profcribed and thrown out of commerce by this decree. People were therefore obliged to carry their fpecie to the Bank, and to exchange it for paper. They ran there in crowds, conjuring and imploring the Clerks to receive their fpecie, and thinking themfelves happy when they fucceeded. Upon which, a merry fellow wittily called out to thofe who were the most forward; Don't be afraid, Gentlemen, that your money should remain on your hands, it fhall all be taken from you. Some individuals then fet up this trade, they were fubftitutes to the Bank, and as every body would abfolutely have bills, and that there was an apprehension of their failing, they preferred, for expedition fake, losing three or four per cent. of their money. In a word, the fame method was practifed with regard to money, as with a bill of Exchange: it was difcounted.

So many treafures poured into this public depot, fhould have ren dered it inexhaustible. Nevertheless, the Bank was drained: there were, as the Regent called them, fome obftinates, that is to fay, perfons who could not perfuade themselves, that paper was of greater value than money, and who were continually realizing the former. In order to deceive these people, the intereft of money was reduced to three and a half, two and a half, and two per cent.; the coin was

1 Twenty-five pounds. Between eight and nine fhillings. fhillings.

§ Five fhillings.

+ Twelve pounds ten kept