John Law

(1671—1729) finance minister in France

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Scottish financial genius, banker, and gambler. In 1716 the French regent gave him permission to set up his own bank in France, which was suffering from Louis XIV's wars and deeply in debt. In 1719 his Mississippi Company gained the monopoly of all French overseas trade. Its stock was placed on the market, demand was high, speculators made fortunes. In the mean time Law had become director‐general of the Banque Royale (previously his Banque Générale) and issued paper notes to match the share issues of the company. Holders of paper money began exchanging it for coin, of which there was insufficient to redeem all paper; a decree to halve the notes' value led to loss of confidence, panic, and crash (1720). Law fled and spent the remaining years of his life in England and Italy.

Subjects: British History.

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