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Memoirs of Extraordinary Popular Delusions — Volume 1

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Title: Memoirs of Extraordinary Popular Delusions — Volume 1

Author: Charles Mackay


        
Release date: August 1, 1996 [eBook #636]
                Most recently updated: July 29, 2012

Language: English

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*** START OF THE PROJECT GUTENBERG EBOOK MEMOIRS OF EXTRAORDINARY POPULAR DELUSIONS — VOLUME 1 ***




Produced by An Anonymous Volunteer







MEMOIRS OF EXTRAORDINARY POPULAR DELUSIONS

By Charles Mackay



Author Of

"The Thames And Its Tributaries," "The Hope Of The World," Etc.

"Il est bon de connaitre les delires de l'esprit humain. Chaque people a
ses folies plus ou moins grossieres." MILLOT


VOL I.

LONDON: RICHARD BENTLEY, NEW BURLINGTON STREET. PUBLISHER IN ORDINARY TO
HER MAJESTY. 1841.


CONTENTS OF THE FIRST VOLUME

  THE MISSISSIPPI SCHEME
  THE SOUTH SEA BUBBLE
  THE TULIPOMANIA
  RELICS
  MODERN PROPHECIES
  POPULAR ADMIRATION FOR GREAT THIEVES
  INFLUENCE OF POLITICS AND RELIGION ON THE HAIR AND BEARD
  DUELS AND ORDEALS
  THE LOVE OF THE MARVELOUS AND THE DISBELIEF OF THE TRUE
  POPULAR FOLLIES IN GREAT CITIES
  THE O. P. MANIA
  THE THUGS, OR PHANSIGARS





NATIONAL DELUSIONS.

     N'en deplaise a ces fous nommes sages de Grece;
     En ce monde il n'est point de parfaite sagesse;
     Tous les hommes sont fous, et malgre tous leurs soins,
     Ne different entre eux que du plus ou du moins.

     BOILEAU.


In reading the history of nations, we find that, like individuals, they
have their whims and their peculiarities; their seasons of excitement
and recklessness, when they care not what they do. We find that whole
communities suddenly fix their minds upon one object, and go mad in its
pursuit; that millions of people become simultaneously impressed with
one delusion, and run after it, till their attention is caught by some
new folly more captivating than the first. We see one nation suddenly
seized, from its highest to its lowest members, with a fierce desire
of military glory; another as suddenly becoming crazed upon a religious
scruple, and neither of them recovering its senses until it has shed
rivers of blood and sowed a harvest of groans and tears, to be reaped
by its posterity. At an early age in the annals of Europe its population
lost their wits about the Sepulchre of Jesus, and crowded in frenzied
multitudes to the Holy Land: another age went mad for fear of the Devil,
and offered up hundreds of thousands of victims to the delusion of
witchcraft. At another time, the many became crazed on the subject of
the Philosopher's Stone, and committed follies till then unheard of in
the pursuit. It was once thought a venial offence in very many countries
of Europe to destroy an enemy by slow poison. Persons who would have
revolted at the idea of stabbing a man to the heart, drugged his pottage
without scruple. Ladies of gentle birth and manners caught the
contagion of murder, until poisoning, under their auspices, became quite
fashionable. Some delusions, though notorious to all the world, have
subsisted for ages, flourishing as widely among civilized and polished
nations as among the early barbarians with whom they originated,--that
of duelling, for instance, and the belief in omens and divination of
the future, which seem to defy the progress of knowledge to eradicate
entirely from the popular mind. Money, again, has often been a cause
of the delusion of multitudes. Sober nations have all at once become
desperate gamblers, and risked almost their existence upon the turn of
a piece of paper. To trace the history of the most prominent of these
delusions is the object of the present pages. Men, it has been well
said, think in herds; it will be seen that they go mad in herds, while
they only recover their senses slowly, and one by one.

In the present state of civilization, society has often shown itself
very prone to run a career of folly from the last-mentioned cases.
This infatuation has seized upon whole nations in a most extraordinary
manner. France, with her Mississippi madness, set the first great
example, and was very soon imitated by England with her South Sea
Bubble. At an earlier period, Holland made herself still more ridiculous
in the eyes of the world, by the frenzy which came over her people for
the love of Tulips. Melancholy as all these delusions were in their
ultimate results, their history is most amusing. A more ludicrous and
yet painful spectacle, than that which Holland presented in the years
1635 and 1636, or France in 1719 and 1720, can hardly be imagined.
Taking them in the order of their importance, we shall commence our
history with John Law and the famous Mississippi scheme of the years
above mentioned.




THE MISSISSIPPI SCHEME

     Some in clandestine companies combine;
     Erect new stocks to trade beyond the line;
     With air and empty names beguile the town,
     And raise new credits first, then cry 'em down;
     Divide the empty nothing into shares,
     And set the crowd together by the ears.

     Defoe.


The personal character and career of one man are so intimately connected
with the great scheme of the years 1719 and 1720, that a history of the
Mississippi madness can have no fitter introduction than a sketch of the
life of its great author, John Law. Historians are divided in opinion as
to whether they should designate him a knave or a madman. Both epithets
were unsparingly applied to him in his lifetime, and while the unhappy
consequences of his projects were still deeply felt. Posterity, however,
has found reason to doubt the justice of the accusation, and to confess
that John Law was neither knave nor madman, but one more deceived
than deceiving; more sinned against than sinning. He was thoroughly
acquainted with the philosophy and true principles of credit. He
understood the monetary question better than any man of his day; and if
his system fell with a crash so tremendous, it was not so much his
fault as that of the people amongst whom he had erected it. He did not
calculate upon the avaricious frenzy of a whole nation; he did not see
that confidence, like mistrust, could be increased, almost ad infinitum,
and that hope was as extravagant as fear. How was he to foretell that
the French people, like the man in the fable, would kill, in their
frantic eagerness, the fine goose he had brought to lay them so many
golden eggs? His fate was like that which may be supposed to have
overtaken the first adventurous boatman who rowed from Erie to Ontario.
Broad and smooth was the river on which he embarked; rapid and pleasant
was his progress; and who was to stay him in his career? Alas for him!
the cataract was nigh. He saw, when it was too late, that the tide which
wafted him so joyously along was a tide of destruction; and when he
endeavoured to retrace his way, he found that the current was too strong
for his weak efforts to stem, and that he drew nearer every instant to
the tremendous falls. Down he went over the sharp rocks, and the
waters with him. He was dashed to pieces with his bark, but the waters,
maddened and turned to foam by the rough descent, only boiled and
bubbled for a time, and then flowed on again as smoothly as ever. Just
so it was with Law and the French people. He was the boatman and they
were the waters.

John Law was born at Edinburgh in the year 1671. His father was the
younger son of an ancient family in Fife, and carried on the business
of a goldsmith and banker. He amassed considerable wealth in his trade,
sufficient to enable him to gratify the wish, so common among his
countrymen, of adding a territorial designation to his name. He
purchased with this view the estates of Lauriston and Randleston, on
the Frith of Forth on the borders of West and Mid Lothian, and was
thenceforth known as Law of Lauriston. The subject of our memoir, being
the eldest son, was received into his father's counting-house at the
age of fourteen, and for three years laboured hard to acquire an insight
into the principles of banking, as then carried on in Scotland. He
had always manifested great love for the study of numbers, and his
proficiency in the mathematics was considered extraordinary in one of
his tender years. At the age of seventeen he was tall, strong, and well
made; and his face, although deeply scarred with the small-pox, was
agreeable in its expression, and full of intelligence. At this time he
began to neglect his business, and becoming vain of his person, indulged
in considerable extravagance of attire. He was a great favourite
with the ladies, by whom he was called Beau Law, while the other sex,
despising his foppery, nicknamed him Jessamy John. At the death of his
father, which happened in 1688, he withdrew entirely from the desk,
which had become so irksome, and being possessed of the revenues of the
paternal estate of Lauriston, he proceeded to London, to see the world.

He was now very young, very vain, good-looking, tolerably rich, and
quite uncontrolled. It is no wonder that, on his arrival in the capital,
he should launch out into extravagance. He soon became a regular
frequenter of the gaming-houses, and by pursuing a certain plan,
based upon some abstruse calculation of chances, he contrived to gain
considerable sums. All the gamblers envied him his luck, and many made
it a point to watch his play, and stake their money on the same chances.
In affairs of gallantry he was equally fortunate; ladies of the first
rank smiled graciously upon the handsome Scotchman--the young, the rich,
the witty, and the obliging. But all these successes only paved the way
for reverses. After he had been for nine years exposed to the dangerous
attractions of the gay life he was leading, he became an irrecoverable
gambler. As his love of play increased in violence, it diminished
in prudence. Great losses were only to be repaired by still greater
ventures, and one unhappy day he lost more than he could repay without
mortgaging his family estate. To that step he was driven at last. At
the same time his gallantry brought him into trouble. A love affair, or
slight flirtation, with a lady of the name of Villiers [Miss Elizabeth
Villiers, afterwards Countess of Orkney] exposed him to the resentment
of a Mr. Wilson, by whom he was challenged to fight a duel. Law
accepted, and had the ill fortune to shoot his antagonist dead upon the
spot. He was arrested the same day, and brought to trial for murder
by the relatives of Mr. Wilson. He was afterwards found guilty, and
sentenced to death. The sentence was commuted to a fine, upon the ground
that the offence only amounted to manslaughter. An appeal being lodged
by a brother of the deceased, Law was detained in the King's Bench,
whence, by some means or other, which he never explained, he contrived
to escape; and an action being instituted against the sheriffs, he was
advertised in the Gazette, and a reward offered for his apprehension. He
was described as "Captain John Law, a Scotchman, aged twenty-six; a
very tall, black, lean man; well shaped, above six feet high, with large
pockholes in his face; big nosed, and speaking broad and loud." As this
was rather a caricature than a description of him, it has been supposed
that it was drawn up with a view to favour his escape. He succeeded in
reaching the Continent, where he travelled for three years, and devoted
much of his attention to the monetary and banking affairs of the
countries through which he passed. He stayed a few months in Amsterdam,
and speculated to some extent in the funds. His mornings were devoted
to the study of finance and the principles of trade, and his evenings to
the gaming-house. It is generally believed that he returned to Edinburgh
in the year 1700. It is certain that he published in that city his
"Proposals and Reasons for constituting a Council of Trade." This
pamphlet did not excite much attention.

In a short time afterwards he published a project for establishing what
he called a Land-bank [The wits of the day called it a sand-bank, which
would wreck the vessel of the state.], the notes issued by which
were never to exceed the value of the entire lands of the state, upon
ordinary interest, or were to be equal in value to the land, with the
right to enter into possession at a certain time. The project excited a
good deal of discussion in the Scottish parliament, and a motion for
the establishment of such a bank was brought forward by a neutral
party, called the Squadrone, whom Law had interested in his favour.
The Parliament ultimately passed a resolution to the effect, that, to
establish any kind of paper credit, so as to force it to pass, was an
improper expedient for the nation.

Upon the failure of this project, and of his efforts to procure a pardon
for the murder of Mr. Wilson, Law withdrew to the Continent, and resumed
his old habits of gaming. For fourteen years he continued to roam about,
in Flanders, Holland, Germany, Hungary, Italy, and France. He soon
became intimately acquainted with the extent of the trade and resources
of each, and daily more confirmed in his opinion that no country could
prosper without a paper currency. During the whole of this time he
appears to have chiefly supported himself by successful play. At every
gambling-house of note in the capitals of Europe, he was known and
appreciated as one better skilled in the intricacies of chance than any
other man of the day. It is stated in the "Biographie Universelle" that
he was expelled, first from Venice, and afterwards from Genoa, by the
magistrates, who thought him a visitor too dangerous for the youth
of those cities. During his residence in Paris he rendered himself
obnoxious to D'Argenson, the lieutenant-general of the police, by whom
he was ordered to quit the capital. This did not take place, however,
before he had made the acquaintance in the saloons, of the Duke de
Vendome, the Prince de Conti, and of the gay Duke of Orleans, the latter
of whom was destined afterwards to exercise so much influence over his
fate. The Duke of Orleans was pleased with the vivacity and good sense
of the Scottish adventurer, while the latter was no less pleased with
the wit and amiability of a prince who promised to become his patron.
They were often thrown into each other's society, and Law seized every
opportunity to instil his financial doctrines into the mind of one whose
proximity to the throne pointed him out as destined, at no very distant
date, to play an important part in the government.

Shortly before the death of Louis XIV, or, as some say, in 1708, Law
proposed a scheme of finance to Desmarets, the Comptroller. Louis is
reported to have inquired whether the projector were a Catholic, and, on
being answered in the negative, to have declined having anything to
do with him. [This anecdote, which is related in the correspondence
of Madame de Baviere, Duchess of Orleans, and mother of the Regent,
is discredited by Lord John Russell, in his "History of the principal
States of Europe, from the Peace of Utrecht;" for what reason he
does not inform us. There is no doubt that Law proposed his scheme to
Desmarets, and that Louis refused to hear of it. The reason given for
the refusal is quite consistent with the character of that bigoted and
tyrannical monarch.]

It was after this repulse that he visited Italy. His mind being still
occupied with schemes of finance, he proposed to Victor Amadeus, Duke of
Savoy, to establish his land-bank in that country. The Duke replied that
his dominions were too circumscribed for the execution of so great a
project, and that he was by far too poor a potentate to be ruined. He
advised him, however, to try the King of France once more; for he was
sure, if he knew anything of the French character, that the people would
be delighted with a plan, not only so new, but so plausible.

Louis XIV died in 1715, and the heir to the throne being an infant only
seven years of age, the Duke of Orleans assumed the reins of government,
as Regent, during his minority. Law now found himself in a more
favourable position. The tide in his affairs had come, which, taken at
the flood, was to waft him on to fortune. The Regent was his friend,
already acquainted with his theory and pretensions, and inclined,
moreover, to aid him in any efforts to restore the wounded credit of
France, bowed down to the earth by the extravagance of the long reign of
Louis XIV.

Hardly was that monarch laid in his grave ere the popular hatred,
suppressed so long, burst forth against his memory. He who, during his
life, had been flattered with an excess of adulation, to which history
scarcely offers a parallel, was now cursed as a tyrant, a bigot, and
a plunderer. His statues were pelted and disfigured; his effigies
torn down, amid the execrations of the populace, and his name rendered
synonymous with selfishness and oppression. The glory of his arms
was forgotten, and nothing was remembered but his reverses, his
extravagance, and his cruelty.

The finances of the country were in a state of the utmost disorder.
A profuse and corrupt monarch, whose profuseness and corruption were
imitated by almost every functionary, from the highest to the lowest
grade, had brought France to the verge of ruin. The national debt
amounted to 3000 millions of livres, the revenue to 145 millions, and
the expenditure to 142 millions per annum; leaving only three millions
to pay the interest upon 3000 millions. The first care of the Regent was
to discover a remedy for an evil of such magnitude, and a council was
early summoned to take the matter into consideration. The Duke de St.
Simon was of opinion that nothing could save the country from revolution
but a remedy at once bold and dangerous. He advised the Regent to
convoke the States-General, and declare a national bankruptcy. The
Duke de Noailles, a man of accommodating principles, an accomplished
courtier, and totally averse from giving himself any trouble or
annoyance that ingenuity could escape from, opposed the project of St.
Simon with all his influence. He represented the expedient as alike
dishonest and ruinous. The Regent was of the same opinion, and this
desperate remedy fell to the ground.

The measures ultimately adopted, though they promised fair, only
aggravated the evil. The first, and most dishonest measure, was of no
advantage to the state. A recoinage was ordered, by which the currency
was depreciated one-fifth; those who took a thousand pieces of gold or
silver to the mint received back an amount of coin of the same nominal
value, but only four-fifths of the weight of metal. By this contrivance
the treasury gained seventy-two millions of livres, and all the
commercial operations of the country were disordered. A trifling
diminution of the taxes silenced the clamours of the people, and for the
slight present advantage the great prospective evil was forgotten.

A chamber of justice was next instituted, to inquire into the
malversations of the loan-contractors and the farmers of the revenues.
Tax collectors are never very popular in any country, but those of
France at this period deserved all the odium with which they were
loaded. As soon as these farmers-general, with all their hosts of
subordinate agents, called maltotiers [From maltote, an oppressive
tax.], were called to account for their misdeeds, the most extravagant
joy took possession of the nation. The Chamber of Justice, instituted
chiefly for this purpose, was endowed with very extensive powers. It was
composed of the presidents and councils of the parliament, the judges
of the Courts of Aid and of Requests, and the officers of the Chamber
of Account, under the general presidence of the minister of finance.
Informers were encouraged to give evidence against the offenders by the
promise of one-fifth part of the fines and confiscations. A tenth of all
concealed effects belonging to the guilty was promised to such as should
furnish the means of discovering them.

The promulgation of the edict constituting this court caused a degree
of consternation among those principally concerned which can only
be accounted for on the supposition that their peculation had been
enormous. But they met with no sympathy. The proceedings against them
justified their terror. The Bastile was soon unable to contain the
prisoners that were sent to it, and the gaols all over the country
teemed with guilty or suspected persons. An order was issued to all
innkeepers and postmasters to refuse horses to such as endeavoured
to seek safety in flight; and all persons were forbidden, under heavy
fines, to harbour them or favour their evasion. Some were condemned to
the pillory, others to the gallies, and the least guilty to fine
and imprisonment. One only, Samuel Bernard, a rich banker, and
farmer-general of a province remote from the capital, was sentenced to
death. So great had been the illegal profits of this man,--looked
upon as the tyrant and oppressor of his district,--that he offered six
millions of livres, or 250,000 pounds sterling, to be allowed to escape.

His bribe was refused, and he suffered the penalty of death. Others,
perhaps more guilty, were more fortunate. Confiscation, owing to the
concealment of their treasures by the delinquents, often produced less
money than a fine. The severity of the government relaxed, and fines,
under the denomination of taxes, were indiscriminately levied upon all
offenders. But so corrupt was every department of the administration,
that the country benefited but little by the sums which thus flowed into
the treasury. Courtiers, and courtiers' wives and mistresses, came in
for the chief share of the spoils. One contractor had been taxed in
proportion to his wealth and guilt, at the sum of twelve millions of
livres. The Count * * *, a man of some weight in the government, called
upon him, and offered to procure a remission of the fine, if he would
give him a hundred thousand crowns. "Vous etes trop tard, mon ami,"
replied the financier; "I have already made a bargain with your wife for
fifty thousand." [This anecdote is related by M. de la Hode, in his Life
of Philippe of Orleans. It would have looked more authentic if he had
given the names of the dishonest contractor and the still more dishonest
minister. But M. de la Hode's book is liable to the same objection as
most of the French memoirs of that and of subsequent periods. It is
sufficient with most of them that an anecdote be ben trovato; the veto
is but matter of secondary consideration.]

About a hundred and eighty millions of livres were levied in this
manner, of which eighty were applied in payment of the debts contracted
by the government. The remainder found its way into the pockets of the
courtiers. Madame de Maintenon, writing on this subject, says, "We hear
every day of some new grant of the Regent; the people murmur very much
at this mode of employing the money taken from the peculators."
The people, who, after the first burst of their resentment is over,
generally express a sympathy for the weak, were indignant that so much
severity should be used to so little purpose. They did not see the
justice of robbing one set of rogues to fatten another. In a few months
all the more guilty had been brought to punishment, and the chamber of
justice looked for victims in humbler walks of life. Charges of fraud
and extortion were brought against tradesmen of good character, in
consequence of the great inducements held out to common informers. They
were compelled to lay open their affairs before this tribunal in order
to establish their innocence. The voice of complaint resounded from
every side, and at the expiration of a year the government found it
advisable to discontinue further proceedings. The chamber of justice was
suppressed, and a general amnesty granted to all against whom no charges
had yet been preferred.

In the midst of this financial confusion Law appeared upon the scene.
No man felt more deeply than the Regent the deplorable state of the
country, but no man could be more averse from putting his shoulders
manfully to the wheel. He disliked business; he signed official
documents without proper examination, and trusted to others what he
should have undertaken himself. The cares inseparable from his high
office were burdensome to him; he saw that something was necessary to
be done, but he lacked the energy to do it, and had not virtue enough
to sacrifice his case and his pleasures in the attempt. No wonder that,
with this character, he listened favourably to the mighty projects, so
easy of execution, of the clever adventurer whom he had formerly known,
and whose talents he appreciated.

When Law presented himself at court, he was most cordially received.
He offered two memorials to the Regent, in which he set forth the
evils that had befallen France, owing to an insufficient currency,
at different times depreciated. He asserted that a metallic currency,
unaided by a paper money, was wholly inadequate to the wants of a
commercial country, and particularly cited the examples of Great
Britain and Holland to show the advantages of paper. He used many
sound arguments on the subject of credit, and proposed, as a means of
restoring that of France, then at so low an ebb among the nations, that
he should be allowed to set up a bank, which should have the management
of the royal revenues, and issue notes, both on that and on landed
security. He further proposed that this bank should be administered
in the King's name, but subject to the control of commissioners, to be
named by the States-General.

While these memorials were under consideration, Law translated into
French his essay on money and trade, and used every means to extend
through the nation his renown as a financier. He soon became talked of.
The confidants of the Regent spread abroad his praise, and every one
expected great things of Monsieur Lass. [The French pronounced his name
in this manner to avoid the ungallic sound, aw. After the failure of his
scheme, the wags said the nation was lasse de lui, and proposed that he
should in future be known by the name of Monsieur Helas!]

On the 5th of May, 1716, a royal edict was published, by which Law was
authorised, in conjunction with his brother, to establish a bank, under
the name of Law and Company, the notes of which should be received in
payment of the taxes. The capital was fixed at six millions of livres,
in twelve thousand shares of five hundred livres each, purchasable
one-fourth in specie and the remainder in billets d'etat. It was not
thought expedient to grant him the whole of the privileges prayed for
in his memorials until experience should have shown their safety and
advantage.

Law was now on the high road to fortune. The study of thirty years was
brought to guide him in the management of his bank. He made all his
notes payable at sight, and in the coin current at the time they
were issued. This last was a master-stroke of policy, and immediately
rendered his notes more valuable than the precious metals. The latter
were constantly liable to depreciation by the unwise tampering of the
government. A thousand livres of silver might be worth their nominal
value one day and be reduced one-sixth the next, but a note of Law's
bank retained its original value. He publicly declared at the same time
that a banker deserved death if he made issues without having sufficient
security to answer all demands. The consequence was, that his notes
advanced rapidly in public estimation, and were received at one per
cent. more than specie. It was not long before the trade of the country
felt the benefit. Languishing commerce began to lift up her head; the
taxes were paid with greater regularity and less murmuring, and a degree
of confidence was established that could not fail, if it continued, to
become still more advantageous. In the course of a year Law's notes rose
to fifteen per cent. premium, while the billets d'etat, or notes
issued by the government, as security for the debts contracted by the
extravagant Louis XIV, were at a discount of no less than seventy-eight
and a half per cent. The comparison was too great in favour of Law not
to attract the attention of the whole kingdom, and his credit extended
itself day by day. Branches of his bank were almost simultaneously
established at Lyons, Rochelle, Tours, Amiens, and Orleans.

The Regent appears to have been utterly astonished at his success, and
gradually to have conceived the idea, that paper, which could so aid a
metallic currency, could entirely supersede it. Upon this fundamental
error he afterwards acted. In the mean time, Law commenced the famous
project which has handed his name down to posterity. He proposed to
the Regent, who could refuse him nothing, to establish a company,
that should have the exclusive privilege of trading to the great river
Mississippi and the province of Louisiana, on its western bank. The
country was supposed to abound in the precious metals, and the company,
supported by the profits of their exclusive commerce, were to be the
sole farmers of the taxes, and sole coiners of money. Letters patent
were issued, incorporating the company, in August 1717. The capital was
divided into two hundred thousand shares of five hundred livres each,
the whole of which might be paid in billets d'etat, at their nominal
value, although worth no more than 160 livres in the market.

It was now that the frenzy of speculating began to seize upon the
nation. Law's bank had effected so much good, that any promises for the
future which he thought proper to make were readily believed. The Regent
every day conferred new privileges upon the fortunate projector. The
bank obtained the monopoly of the sale of tobacco; the sole right of
refinage of gold and silver, and was finally erected into the Royal Bank
of France. Amid the intoxication of success, both Law and the Regent
forgot the maxim so loudly proclaimed by the former, that a banker
deserved death who made issues of paper without the necessary funds to
provide for them. As soon as the bank, from a private, became a public
institution, the Regent caused a fabrication of notes to the amount of
one thousand millions of livres. This was the first departure from sound
principles, and one for which Law is not justly blameable. While
the affairs of the bank were under his control, the issues had never
exceeded sixty millions. Whether Law opposed the inordinate increase
is not known, but as it took place as soon as the bank was made a royal
establishment, it is but fair to lay the blame of the change of system
upon the Regent.

Law found that he lived under a despotic government, but he was not yet
aware of the pernicious influence which such a government could exercise
upon so delicate a framework as that of credit. He discovered it
afterwards to his cost, but in the mean time suffered himself to be
impelled by the Regent into courses which his own reason must have
disapproved. With a weakness most culpable, he lent his aid in
inundating the country with paper money, which, based upon no solid
foundation, was sure to fall, sooner or later. The extraordinary present
fortune dazzled his eyes, and prevented him from seeing the evil day
that would burst over his head, when once, from any cause or other, the
alarm was sounded. The Parliament were from the first jealous of his
influence as a foreigner, and had, besides, their misgivings as to
the safety of his projects. As his influence extended, their animosity
increased. D'Aguesseau, the Chancellor, was unceremoniously dismissed by
the Regent for his opposition to the vast increase of paper money, and
the constant depreciation of the gold and silver coin of the realm.
This only served to augment the enmity of the Parliament, and when
D'Argenson, a man devoted to the interests of the Regent, was appointed
to the vacant chancellorship, and made at the same time minister of
finance, they became more violent than ever. The first measure of the
new minister caused a further depreciation of the coin. In order to
extinguish the billets d'etat, it was ordered that persons bringing
to the mint four thousand livres in specie and one thousand livres in
billets d'etat, should receive back coin to the amount of five thousand
livres. D'Argenson plumed himself mightily upon thus creating five
thousand new and smaller livres out of the four thousand old and larger
ones, being too ignorant of the true principles of trade and credit to
be aware of the immense injury he was inflicting upon both.

The Parliament saw at once the impolicy and danger of such a system,
and made repeated remonstrances to the Regent. The latter refused to
entertain their petitions, when the Parliament, by a bold, and very
unusual stretch of authority, commanded that no money should be received
in payment but that of the old standard. The Regent summoned a lit de
justice, and annulled the decree. The Parliament resisted, and issued
another. Again the Regent exercised his privilege, and annulled it,
till the Parliament, stung to fiercer opposition, passed another decree,
dated August 12th, 1718, by which they forbade the bank of Law to have
any concern, either direct or indirect, in the administration of the
revenue; and prohibited all foreigners, under heavy penalties, from
interfering, either in their own names, or in that of others, in the
management of the finances of the state. The Parliament considered Law
to be the author of all the evil, and some of the counsellors, in the
virulence of their enmity, proposed that he should be brought to trial,
and, if found guilty, be hung at the gates of the Palais de Justice.

Law, in great alarm, fled to the Palais Royal, and threw himself on the
protection of the Regent, praying that measures might be taken to reduce
the Parliament to obedience. The Regent had nothing so much at heart,
both on that account and because of the disputes that had arisen
relative to the legitimation of the Duke of Maine and the Count of
Thoulouse, the sons of the late King. The Parliament was ultimately
overawed by the arrest of their president and two of the counsellors,
who were sent to distant prisons.

Thus the first cloud upon Law's prospects blew over: freed from
apprehension of personal danger, he devoted his attention to his famous
Mississippi project, the shares of which were rapidly rising, in spite
of the Parliament. At the commencement of the year 1719 an edict was
published, granting to the Mississippi Company the exclusive privilege
of trading to the East Indies, China, and the South Seas, and to all the
possessions of the French East India Company, established by Colbert.
The Company, in consequence of this great increase of their business,
assumed, as more appropriate, the title of Company of the Indies, and
created fifty thousand new shares. The prospects now held out by Law
were most magnificent. He promised a yearly dividend of two hundred
livres upon each share of five hundred, which, as the shares were
paid for in billets d'etat, at their nominal value, but worth only 100
livres, was at the rate of about 120 per cent. profit.

The public enthusiasm, which had been so long rising, could not resist
a vision so splendid. At least three hundred thousand applications were
made for the fifty thousand new shares, and Law's house in the Rue de
Quincampoix was beset from morning to night by the eager applicants.
As it was impossible to satisfy them all, it was several weeks before a
list of the fortunate new stockholders could be made out, during which
time the public impatience rose to a pitch of frenzy. Dukes, marquises,
counts, with their duchesses, marchionesses, and countesses, waited
in the streets for hours every day before Mr. Law's door to know the
result. At last, to avoid the jostling of the plebeian crowd, which,
to the number of thousands, filled the whole thoroughfare, they took
apartments in the adjoining houses, that they might be continually near
the temple whence the new Plutus was diffusing wealth. Every day the
value of the old shares increased, and the fresh applications, induced
by the golden dreams of the whole nation, became so numerous that it
was deemed advisable to create no less than three hundred thousand new
shares, at five thousand livres each, in order that the Regent might
take advantage of the popular enthusiasm to pay off the national debt.
For this purpose, the sum of fifteen hundred millions of livres was
necessary. Such was the eagerness of the nation, that thrice the sum
would have been subscribed if the government had authorised it.

Law was now at the zenith of his prosperity, and the people were rapidly
approaching the zenith of their infatuation. The highest and the lowest
classes were alike filled with a vision of boundless wealth. There was
not a person of note among the aristocracy, with the exception of the
Duke of St. Simon and Marshal Villars, who was not engaged in buying
or selling stock. People of every age and sex, and condition in life,
speculated in the rise and fall of the Mississippi bonds. The Rue de
Quincampoix was the grand resort of the jobbers, and it being a narrow,
inconvenient street, accidents continually occurred in it, from the
tremendous pressure of the crowd. Houses in it, worth, in ordinary
times, a thousand livres of yearly rent, yielded as much as twelve or
sixteen thousand. A cobbler, who had a stall in it, gained about two
hundred livres a day by letting it out, and furnishing writing materials
to brokers and their clients. The story goes, that a hump-backed man who
stood in the street gained considerable sums by lending his hump as a
writing-desk to the eager speculators! The great concourse of persons
who assembled to do business brought a still greater concourse of
spectators. These again drew all the thieves and immoral characters of
Paris to the spot, and constant riots and disturbances took place. At
nightfall, it was often found necessary to send a troop of soldiers to
clear the street.

Law, finding the inconvenience of his residence, removed to the Place
Vendome, whither the crowd of agioteurs followed him. That spacious
square soon became as thronged as the Rue de Quincampoix: from morning
to night it presented the appearance of a fair. Booths and tents were
erected for the transaction of business and the sale of refreshments,
and gamblers with their roulette tables stationed themselves in the very
middle of the place, and reaped a golden, or rather a paper, harvest
from the throng. The Boulevards and public gardens were forsaken;
parties of pleasure took their walks in preference in the Place Vendome,
which became the fashionable lounge of the idle, as well as the general
rendezvous of the busy. The noise was so great all day, that the
Chancellor, whose court was situated in the square, complained to the
Regent and the municipality, that he could not hear the advocates. Law,
when applied to, expressed his willingness to aid in the removal of the
nuisance, and for this purpose entered into a treaty with the Prince de
Carignan for the Hotel de Soissons, which had a garden of several acres
in the rear. A bargain was concluded, by which Law became the purchaser
of the hotel, at an enormous price, the Prince reserving to himself the
magnificent gardens as a new source of profit. They contained some fine
statues and several fountains, and were altogether laid out with much
taste. As soon as Law was installed in his new abode, an edict was
published, forbidding all persons to buy or sell stock anywhere but
in the gardens of the Hotel de Soissons. In the midst among the trees,
about five hundred small tents and pavilions were erected, for the
convenience of the stock-jobbers. Their various colours, the gay ribands
and banners which floated from them, the busy crowds which passed
continually in and out--the incessant hum of voices, the noise,
the music, and the strange mixture of business and pleasure on the
countenances of the throng, all combined to give the place an air of
enchantment that quite enraptured the Parisians. The Prince de Carignan
made enormous profits while the delusion lasted. Each tent was let at
the rate of five hundred livres a month; and, as there were at least
five hundred of them, his monthly revenue from this source alone must
have amounted to 250,000 livres, or upwards of 10,000 pounds sterling.

The honest old soldier, Marshal Villars, was so vexed to see the folly
which had smitten his countrymen, that he never could speak with
temper on the subject. Passing one day through the Place Vendome in his
carriage, the choleric gentleman was so annoyed at the infatuation of
the people, that he abruptly ordered his coachman to stop, and, putting
his head out of the carriage window, harangued them for full half an
hour on their "disgusting avarice." This was not a very wise proceeding
on his part. Hisses and shouts of laughter resounded from every side,
and jokes without number were aimed at him. There being at last strong
symptoms that something more tangible was flying through the air in
the direction of his head, Marshal was glad to drive on. He never again
repeated the experiment.

Two sober, quiet, and philosophic men of letters, M. de la Motte and the
Abbe Terrason, congratulated each other, that they, at least, were free
from this strange infatuation. A few days afterwards, as the worthy
Abbe was coming out of the Hotel de Soissons, whither he had gone to buy
shares in the Mississippi, whom should he see but his friend La Motte
entering for the same purpose. "Ha!" said the Abbe, smiling, "is that
you?" "Yes," said La Motte, pushing past him as fast as he was able;
"and can that be you?" The next time the two scholars met, they talked
of philosophy, of science, and of religion, but neither had courage for
a long time to breathe one syllable about the Mississippi. At last, when
it was mentioned, they agreed that a man ought never to swear against
his doing any one thing, and that there was no sort of extravagance of
which even a wise man was not capable.

During this time, Law, the new Plutus, had become all at once the most
important personage of the state. The ante-chambers of the Regent were
forsaken by the courtiers. Peers, judges, and bishops thronged to the
Hotel de Soissons; officers of the army and navy, ladies of title and
fashion, and every one to whom hereditary rank or public employ gave a
claim to precedence, were to be found waiting in his ante-chambers to
beg for a portion of his India stock. Law was so pestered that he was
unable to see one-tenth part of the applicants, and every manoeuvre that
ingenuity could suggest was employed to gain access to him. Peers, whose
dignity would have been outraged if the Regent had made them wait half
an hour for an interview, were content to wait six hours for the chance
of seeing Monsieur Law. Enormous fees were paid to his servants, if
they would merely announce their names. Ladies of rank employed the
blandishments of their smiles for the same object; but many of them came
day after day for a fortnight before they could obtain an audience. When
Law accepted an invitation, he was sometimes so surrounded by ladies,
all asking to have their names put down in his lists as shareholders in
the new stock, that, in spite of his well-known and habitual gallantry,
he was obliged to tear himself away par force. The most ludicrous
stratagems were employed to have an opportunity of speaking to him. One
lady, who had striven in vain during several days, gave up in despair
all attempts to see him at his own house, but ordered her coachman to
keep a strict watch whenever she was out in her carriage, and if he saw
Mr. Law coming, to drive against a post, and upset her. The coachman
promised obedience, and for three days the lady was driven incessantly
through the town, praying inwardly for the opportunity to be overturned.
At last she espied Mr. Law, and, pulling the string, called out to the
coachman, "Upset us now! for God's sake, upset us now!" The coachman
drove against a post, the lady screamed, the coach was overturned,
and Law, who had seen the accident, hastened to the spot to render
assistance. The cunning dame was led into the Hotel de Soissons, where
she soon thought it advisable to recover from her fright, and, after
apologizing to Mr. Law, confessed her stratagem. Law smiled, and entered
the lady in his books as the purchaser of a quantity of India stock.
Another story is told of a Madame de Boucha, who, knowing that Mr. Law
was at dinner at a certain house, proceeded thither in her carriage, and
gave the alarm of fire. The company started from table, and Law among
the rest; but, seeing one lady making all haste into the house towards
him, while everybody else was scampering away, he suspected the trick,
and ran off in another direction.

Many other anecdotes are related, which even, though they may be a
little exaggerated, are nevertheless worth preserving, as showing the
spirit of that singular period. [The curious reader may find an anecdote
of the eagerness of the French ladies to retain Law in their company,
which will make him blush or smile according as he happens to be very
modest or the reverse. It is related in the Letters of Madame Charlotte
Elizabeth de Baviere, Duchess of Orleans, vol. ii. p. 274.] The Regent
was one day mentioning, in the presence of D'Argenson, the Abbe Dubois,
and some other persons, that he was desirous of deputing some lady, of
the rank at least of a Duchess, to attend upon his daughter at Modena;
"but," added he, "I do not exactly know where to find one." "No!"
replied one, in affected surprise; "I can tell you where to find every
Duchess in France:--you have only to go to Mr. Law's; you will see them
every one in his ante-chamber."

M. de Chirac, a celebrated physician, had bought stock at an unlucky
period, and was very anxious to sell out. Stock, however continued to
fall for two or three days, much to his alarm. His mind was filled with
the subject, when he was suddenly called upon to attend a lady, who
imagined herself unwell. He arrived, was shown up stairs, and felt the
lady's pulse. "It falls! it falls! good God! it falls continually!" said
he, musingly, while the lady looked up in his face, all anxiety for his
opinion. "Oh! M. de Chirac," said she, starting to her feet, and ringing
the bell for assistance; "I am dying! I am dying! it falls! it falls! it
falls!" "What falls?" inquired the doctor, in amazement. "My pulse! my
pulse!" said the lady; "I must be dying." "Calm your apprehensions, my
dear Madam," said M. de Chirac; "I was speaking of the stocks. The truth
is, I have been a great loser, and my mind is so disturbed, I hardly
know what I have been saying."

The price of shares sometimes rose ten or twenty per cent. in the course
of a few hours, and many persons in the humbler walks of life, who had
risen poor in the morning, went to bed in affluence. An extensive holder
of stock, being taken ill, sent his servant to sell two hundred and
fifty shares, at eight thousand livres each, the price at which they
were then quoted. The servant went, and, on his arrival in the Jardin de
Soissons, found that in the interval the price had risen to ten thousand
livres. The difference of two thousand livres on the two hundred and
fifty shares, amounting to 500,000 livres, or 20,000 pounds sterling, he
very coolly transferred to his own use, and, giving the remainder to his
master, set out the same evening for another country. Law's coachman in
a very short time made money enough to set up a carriage of his own, and
requested permission to leave his service. Law, who esteemed the man,
begged of him as a favour, that he would endeavour, before he went, to
find a substitute as good as himself. The coachman consented, and in the
evening brought two of his former comrades, telling Mr. Law to choose
between them, and he would take the other. Cookmaids and footmen
were now and then as lucky, and, in the full-blown pride of their
easily-acquired wealth, made the most ridiculous mistakes. Preserving
the language and manners of their old, with the finery of their new
station, they afforded continual subjects for the pity of the sensible,
the contempt of the sober, and the laughter of everybody. But the folly
and meanness of the higher ranks of society were still more disgusting.
One instance alone, related by the Duke de St. Simon, will show the
unworthy avarice which infected the whole of society. A man of the name
of Andre, without character or education, had, by a series of well-timed
speculations in Mississippi bonds, gained enormous wealth, in an
incredibly short space of time. As St. Simon expresses it, "he had
amassed mountains of gold." As he became rich, he grew ashamed of the
lowness of his birth, and anxious above all things to be allied to
nobility. He had a daughter, an infant only three years of age, and he
opened a negotiation with the aristocratic and needy family of D'Oyse,
that this child should, upon certain conditions, marry a member of that
house. The Marquis d'Oyse, to his shame, consented, and promised to
marry her himself on her attaining the age of twelve, if the father
would pay him down the sum of a hundred thousand crowns, and twenty
thousand livres every year, until the celebration of the marriage. The
Marquis was himself in his thirty-third year. This scandalous bargain
was duly signed and sealed, the stockjobber furthermore agreeing to
settle upon his daughter, on the marriage-day, a fortune of several
millions. The Duke of Brancas, the head of the family, was present
throughout the negotiation, and shared in all the profits. St. Simon,
who treats the matter with the levity becoming what he thought so good
a joke, adds, "that people did not spare their animadversions on this
beautiful marriage," and further informs us, "that the project fell to
the ground some months afterwards by the overthrow of Law, and the ruin
of the ambitious Monsieur Andre." It would appear, however, that the
noble family never had the honesty to return the hundred thousand
crowns.

Amid events like these, which, humiliating though they be, partake
largely of the ludicrous, others occurred of a more serious nature.
Robberies in the streets were of daily occurrence, in consequence of
the immense sums, in paper, which people carried about with them.
Assassinations were also frequent. One case in particular fixed the
attention of the whole of France, not only on account of the enormity of
the offence, but of the rank and high connexions of the criminal.

The Count d'Horn, a younger brother of the Prince d'Horn, and related
to the noble families of D'Aremberg, De Ligne, and De Montmorency, was
a young man of dissipated character, extravagant to a degree, and
unprincipled as he was extravagant. In connexion with two other young
men as reckless as himself, named Mille, a Piedmontese captain, and one
Destampes, or Lestang, a Fleming, he formed a design to rob a very rich
broker, who was known, unfortunately for himself, to carry great sums
about his person. The Count pretended a desire to purchase of him a
number of shares in the Company of the Indies, and for that purpose
appointed to meet him in a cabaret, or low public-house, in the
neighbourhood of the Place Vendome. The unsuspecting broker was punctual
to his appointment; so were the Count d'Horn and his two associates,
whom he introduced as his particular friends. After a few moments'
conversation, the Count d'Horn suddenly sprang upon his victim, and
stabbed him three times in the breast with a poniard. The man fell
heavily to the ground, and, while the Count was employed in rifling his
portfolio of bonds in the Mississippi and Indian schemes to the amount
of one hundred thousand crowns, Mille, the Piedmontese, stabbed the
unfortunate broker again and again, to make sure of his death. But the
broker did not fall without a struggle, and his cries brought the people
of the cabaret to his assistance. Lestang, the other assassin, who had
been set to keep watch at a staircase, sprang from a window and escaped;
but Mille and the Count d'Horn were seized in the very act.

This crime, committed in open day, and in so public a place as a
cabaret, filled Paris with consternation. The trial of the assassins
commenced on the following day, and the evidence being so clear, they
were both found guilty and condemned to be broken alive on the wheel.
The noble relatives of the Count d'Horn absolutely blocked up the
ante-chambers of the Regent, praying for mercy on the misguided youth,
and alleging that he was insane. The Regent avoided them as long as
possible, being determined that, in a case so atrocious, justice should
take its course; but the importunity of these influential suitors was
not to be overcome so silently, and they at last forced themselves into
the presence of the Regent, and prayed him to save their house the shame
of a public execution. They hinted that the Princes d'Horn were allied
to the illustrious family of Orleans, and added that the Regent himself
would be disgraced if a kinsman of his should die by the hands of a
common executioner. The Regent, to his credit, was proof against all
their solicitations, and replied to their last argument in the words of
Corneille,--

     "Le crime fait la honte, et non pas l'echafaud:"

adding, that whatever shame there might be in the punishment he would
very willingly share with the other relatives. Day after day they
renewed their entreaties, but always with the same result. At last
they thought that if they could interest the Duke de St. Simon in
their layout, a man for whom the Regent felt sincere esteem, they might
succeed in their object. The Duke, a thorough aristocrat, was as shocked
as they were, that a noble assassin should die by the same death as a
plebeian felon, and represented to the Regent the impolicy of making
enemies of so numerous, wealthy, and powerful a family. He urged, too,
that in Germany, where the family of D'Aremberg had large possessions,
it was the law, that no relative of a person broken on the wheel could
succeed to any public office or employ until a whole generation had
passed away. For this reason he thought the punishment of the guilty
Count might be transmuted into beheading, which was considered all over
Europe as much less infamous. The Regent was moved by this argument, and
was about to consent, when Law, who felt peculiarly interested in the
fate of the murdered man, confirmed him in his former resolution, to let
the law take its course.

The relatives of D'Horn were now reduced to the last extremity. The
Prince de Robec Montmorency, despairing of other methods, found means
to penetrate into the dungeon of the criminal, and offering him a cup of
poison, implored him to save them from disgrace. The Count d'Horn turned
away his head, and refused to take it. Montmorency pressed him once
more, and losing all patience at his continued refusal, turned on his
heel, and exclaiming, "Die, then, as thou wilt, mean-spirited wretch!
thou art fit only to perish by the hands of the hangman!" left him to
his fate.

D'Horn himself petitioned the Regent that he might be beheaded, but Law,
who exercised more influence over his mind than any other person, with
the exception of the notorious Abbe Dubois, his tutor, insisted that
he could not in justice succumb to the self-interested views of the
D'Horns. The Regent had from the first been of the same opinion, and
within six days after the commission of their crime, D'Horn and Mille
were broken on the wheel in the Place de Greve. The other assassin,
Lestang, was never apprehended.

This prompt and severe justice was highly pleasing to the populace of
Paris; even M. de Quincampoix, as they called Law, came in for a share
of their approbation for having induced the Regent to show no favour
to a patrician. But the number of robberies and assassinations did
not diminish. No sympathy was shown for rich jobbers when they were
plundered: the general laxity of public morals, conspicuous enough
before, was rendered still more so by its rapid pervasion of the middle
classes, who had hitherto remained comparatively pure, between the open
vices of the class above and the hidden crimes of the class below them.
The pernicious love of gambling diffused itself through society, and
bore all public, and nearly all private, virtue before it.

For a time, while confidence lasted, an impetus was given to trade,
which could not fail to be beneficial. In Paris, especially, the good
results were felt. Strangers flocked into the capital from every part,
bent, not only upon making money, but on spending it. The Duchess of
Orleans, mother of the Regent, computes the increase of the population
during this time, from the great influx of strangers from all parts of
the world, at 305,000 souls. The housekeepers were obliged to make up
beds in garrets, kitchens, and even stables, for the accommodation of
lodgers; and the town was so full of carriages and vehicles of every
description, that they were obliged in the principal streets to drive at
a foot-pace for fear of accidents. The looms of the country worked with
unusual activity, to supply rich laces, silks, broad-cloth, and velvets,
which being paid for in abundant paper, increased in price four-fold.
Provisions shared the general advance; bread, meat, and vegetables were
sold at prices greater than had ever before been known; while the wages
of labour rose in exactly the same proportion. The artisan, who formerly
gained fifteen sous per diem, now gained sixty. New houses were built
in every direction; an illusory prosperity shone over the land, and so
dazzled the eyes of the whole nation that none could see the dark cloud
on the horizon, announcing the storm that was too rapidly approaching.

Law himself, the magician whose wand had wrought so surprising a change,
shared, of course, in the general prosperity. His wife and daughter were
courted by the highest nobility, and their alliance sought by the
heirs of ducal and princely houses. He bought two splendid estates
in different parts of France, and entered into a negotiation with the
family of the Duke de Sully for the purchase of the Marquisate of Rosny.
His religion being an obstacle to his advancement, the Regent promised,
if he would publicly conform to the Catholic faith, to make him
comptroller-general of the finances. Law, who had no more real religion
than any other professed gambler, readily agreed, and was confirmed by
the Abbe de Tencin in the cathedral of Melun, in presence of a great
crowd of spectators.

[The following squib was circulated on the occasion:--

     "Foin de ton zele seraphique,
     Malheureux Abbe de Tencin,
     Depuis que Law est Catholique,
     Tout le royaume est Capucin

Thus, somewhat weakly and paraphrastically rendered by Justansond, in
his translation of the "Memoirs of Louis XV:"--

     "Tencin, a curse on thy seraphic zeal,
     Which by persuasion hath contrived the means
     To make the Scotchman at our altars kneel,
     Since which we all are poor as Capucines?]

On the following day he was elected honorary churchwarden of the parish
of St. Roch, upon which occasion he made it a present of the sum of five
hundred thousand livres. His charities, always magnificent, were not
always so ostentatious. He gave away great sums privately, and no tale
of real distress ever reached his ears in vain.

At this time, he was by far the most influential person of the state.
The Duke of Orleans had so much confidence in his sagacity, and the
success of his plans, that he always consulted him upon every matter
of moment. He was by no means unduly elevated by his prosperity, but
remained the same simple, affable, sensible man that he had shown
himself in adversity. His gallantry, which was always delightful to the
fair objects of it, was of a nature, so kind, so gentlemanly, and so
respectful, that not even a lover could have taken offence at it. If
upon any occasion he showed any symptoms of haughtiness, it was to the
cringing nobles, who lavished their adulation upon him till it became
fulsome. He often took pleasure in seeing how long he could make them
dance attendance upon him for a single favour. To such of his own
countrymen as by chance visited Paris, and sought an interview with him,
he was, on the contrary, all politeness and attention. When Archibald
Campbell, Earl of Islay, and afterwards Duke of Argyle, called upon him
in the Place Vendome, he had to pass through an ante-chamber crowded
with persons of the first distinction, all anxious to see the great
financier, and have their names put down as first on the list of some
new subscription. Law himself was quietly sitting in his library,
writing a letter to the gardener at his paternal estate of Lauriston
about the planting of some cabbages! The Earl stayed for a considerable
time, played a game of piquet with his countryman, and left him, charmed
with his ease, good sense, and good breeding.

Among the nobles who, by means of the public credulity at this time,
gained sums sufficient to repair their ruined fortunes, may be mentioned
the names of the Dukes de Bourbon, de Guiche, de la Force [The Duke de
la Force gained considerable sums, not only by jobbing in the stocks,
but in dealing in porcelain, spices, &c. It was debated for a length of
time in the Parliament of Paris whether he had not, in his quality of
spice-merchant, forfeited his rank in the peerage. It was decided in
the negative. A caricature of him was made, dressed as a street porter,
carrying a large bale of spices on his back, with the inscription,
"Admirez La Force."], de Chaulnes, and d'Antin; the Marechal d'Estrees,
the Princes de Rohan, de Poix, and de Leon. The Duke de Bourbon, son
of Louis XIV by Madame de Montespan, was peculiarly fortunate in his
speculations in Mississippi paper. He rebuilt the royal residence of
Chantilly in a style of unwonted magnificence, and, being passionately
fond of horses, he erected a range of stables, which were long renowned
throughout Europe, and imported a hundred and fifty of the finest racers
from England, to improve the breed in France. He bought a large extent
of country in Picardy, and became possessed of nearly all the valuable
lands lying between the Oise and the Somme.

When fortunes such as these were gained, it is no wonder that Law should
have been almost worshipped by the mercurial population. Never was
monarch more flattered than he was. All the small poets and litterateurs
of the day poured floods of adulation upon him. According to them he was
the saviour of the country, the tutelary divinity of France; wit was in
all his words, goodness in all his looks, and wisdom in all his actions.
So great a crowd followed his carriage whenever he went abroad, that the
Regent sent him a troop of horse as his permanent escort, to clear the
streets before him.

It was remarked at this time, that Paris had never before been so full
of objects of elegance and luxury. Statues, pictures, and tapestries
were imported in great quantities from foreign countries, and found
a ready market. All those pretty trifles in the way of furniture and
ornament which the French excel in manufacturing, were no longer the
exclusive play-things of the aristocracy, but were to be found in
abundance in the houses of traders and the middle classes in general.
Jewellery of the most costly description was brought to Paris as the
most favourable mart. Among the rest, the famous diamond, bought by
the Regent, and called by his name, and which long adorned the crown of
France. It was purchased for the sum of two millions of livres, under
circumstances which show that the Regent was not so great a gainer as
some of his subjects, by the impetus which trade had received. When
the diamond was first offered to him, he refused to buy it, although he
desired, above all things, to possess it, alleging as his reason, that
his duty to the country he governed would not allow him to spend
so large a sum of the public money for a mere jewel. This valid and
honourable excuse threw all the ladies of the court into alarm, and
nothing was heard for some days but expressions of regret, that so rare
a gem should be allowed to go out of France; no private individual being
rich enough to buy it. The Regent was continually importuned about it;
but all in vain, until the Duke de St. Simon, who, with all his ability,
was something of a twaddler, undertook the weighty business. His
entreaties, being seconded by Law, the good-natured Regent gave his
consent, leaving to Law's ingenuity to find the means to pay for it. The
owner took security for the payment of the sum of two millions of livres
within a stated period, receiving, in the mean time, the interest of
five per cent. upon that amount, and being allowed, besides, all the
valuable clippings of the gem. St. Simon, in his Memoirs, relates, with
no little complacency, his share in this transaction. After describing
the diamond to be as large as a greengage, of a form nearly round,
perfectly white, and without flaw, and weighing more than five hundred
grains, he concludes with a chuckle, by telling the world, "that he
takes great credit to himself for having induced the Regent to make
so illustrious a purchase." In other words, he was proud that he had
induced him to sacrifice his duty, and buy a bauble for himself, at an
extravagant price, out of the public money.

Thus the system continued to flourish till the commencement of the year
1720. The warnings of the Parliament, that too great a creation of paper
money would, sooner or later, bring the country to bankruptcy, were
disregarded. The Regent, who knew nothing whatever of the philosophy
of finance, thought that a system which had produced such good effects
could never be carried to excess. If five hundred millions of paper had
been of such advantage, five hundred millions additional would be of
still greater advantage. This was the grand error of the Regent, and
which Law did not attempt to dispel. The extraordinary avidity of the
people kept up the delusion; and the higher the price of Indian and
Mississippi stock, the more billets de banque were issued to keep pace
with it. The edifice thus reared might not unaptly be compared to the
gorgeous palace erected by Potemkin, that princely barbarian of Russia,
to surprise and please his imperial mistress: huge blocks of ice were
piled one upon another; ionic pillars, of chastest workmanship, in ice,
formed a noble portico; and a dome, of the same material, shone in the
sun, which had just strength enough to gild, but not to melt it. It
glittered afar, like a palace of crystals and diamonds; but there came
one warm breeze from the south, and the stately building dissolved away,
till none were able even to gather up the fragments. So with Law and his
paper system. No sooner did the breath of popular mistrust blow steadily
upon it, than it fell to ruins, and none could raise it up again.

The first slight alarm that was occasioned was early in 1720. The Prince
de Conti, offended that Law should have denied him fresh shares in India
stock, at his own price, sent to his bank to demand payment in specie
of so enormous a quantity of notes, that three waggons were required for
its transport. Law complained to the Regent, and urged on his attention
the mischief that would be done, if such an example found many
imitators. The Regent was but too well aware of it, and, sending for the
Prince de Conti, ordered him, under penalty of his high displeasure, to
refund to the Bank two-thirds of the specie which he had withdrawn from
it. The Prince was forced to obey the despotic mandate. Happily for
Law's credit, De Conti was an unpopular man: everybody condemned his
meanness and cupidity, and agreed that Law had been hardly treated. It
is strange, however, that so narrow an escape should not have made both
Law and the Regent more anxious to restrict their issues. Others were
soon found who imitated, from motives of distrust, the example which had
been set by De Conti in revenge. The more acute stockjobbers imagined
justly that prices could not continue to rise for ever. Bourdon and
La Richardiere, renowned for their extensive operations in the funds,
quietly and in small quantities at a time, converted their notes into
specie, and sent it away to foreign countries. They also bought as much
as they could conveniently carry of plate and expensive jewellery, and
sent it secretly away to England or to Holland. Vermalet, a jobber, who
sniffed the coming storm, procured gold and silver coin to the amount
of nearly a million of livres, which he packed in a farmer's cart, and
covered over with hay and cow-dung. He then disguised himself in the
dirty smock-frock, or blouse, of a peasant, and drove his precious load
in safety into Belgium. From thence he soon found means to transport it
to Amsterdam.

Hitherto no difficulty had been experienced by any class in procuring
specie for their wants. But this system could not long be carried on
without causing a scarcity. The voice of complaint was heard on every
side, and inquiries being instituted, the cause was soon discovered. The
council debated long on the remedies to be taken, and Law, being called
on for his advice, was of opinion, that an edict should be published,
depreciating the value of coin five per cent. below that of paper. The
edict was published accordingly; but, failing of its intended effect,
was followed by another, in which the depreciation was increased to ten
per cent. The payments of the bank were at the same time restricted to
one hundred livres in gold, and ten in silver. All these measures were
nugatory to restore confidence in the paper, though the restriction of
cash payments within limits so extremely narrow kept up the credit of
the Bank.

Notwithstanding every effort to the contrary, the precious metals
continued to be conveyed to England and Holland. The little coin that
was left in the country was carefully treasured, or hidden until the
scarcity became so great, that the operations of trade could no longer
be carried on. In this emergency, Law hazarded the bold experiment of
forbidding the use of specie altogether. In February 1720 an edict was
published, which, instead of restoring the credit of the paper, as was
intended, destroyed it irrecoverably, and drove the country to the very
brink of revolution. By this famous edict it was forbidden to any person
whatever to have more than five hundred livres (20 pounds sterling) of
coin in his possession, under pain of a heavy fine, and confiscation of
the sums found. It was also forbidden to buy up jewellery, plate,
and precious stones, and informers were encouraged to make search for
offenders, by the promise of one-half the amount they might discover.
The whole country sent up a cry of distress at this unheard-of tyranny.
The most odious persecution daily took place. The privacy of families
was violated by the intrusion of informers and their agents. The most
virtuous and honest were denounced for the crime of having been seen
with a louis d'or in their possession. Servants betrayed their
masters, one citizen became a spy upon his neighbour, and arrests and
confiscations so multiplied, that the courts found a difficulty in
getting through the immense increase of business thus occasioned. It
was sufficient for an informer to say that he suspected any person of
concealing money in his house, and immediately a search-warrant was
granted. Lord Stair, the English ambassador, said, that it was now
impossible to doubt of the sincerity of Law's conversion to the Catholic
religion; he had established the inquisition, after having given
abundant evidence of his faith in transubstantiation, by turning so much
gold into paper.

Every epithet that popular hatred could suggest was showered upon the
Regent and the unhappy Law. Coin, to any amount above five hundred
livres, was an illegal tender, and nobody would take paper if he could
help it. No one knew to-day what his notes would be worth to-morrow.
"Never," says Duclos, in his Secret Memoirs of the Regency, "was seen a
more capricious government-never was a more frantic tyranny exercised by
hands less firm. It is inconceivable to those who were witnesses of the
horrors of those times, and who look back upon them now as on a dream,
that a sudden revolution did not break out--that Law and the Regent did
not perish by a tragical death. They were both held in horror, but the
people confined themselves to complaints; a sombre and timid despair, a
stupid consternation, had seized upon all, and men's minds were too vile
even to be capable of a courageous crime." It would appear that, at one
time, a movement of the people was organised. Seditious writings were
posted up against the walls, and were sent, in hand-bills, to the houses
of the most conspicuous people. One of them, given in the "Memoires de
la Regence," was to the following effect:--"Sir and Madam,--This is to
give you notice that a St. Bartholomew's Day will be enacted again on
Saturday and Sunday, if affairs do not alter. You are desired not to
stir out, nor you, nor your servants. God preserve you from the flames!
Give notice to your neighbours. Dated Saturday, May 25th, 1720." The
immense number of spies with which the city was infested rendered the
people mistrustful of one another, and beyond some trifling disturbances
made in the evening by an insignificant group, which was soon dispersed,
the peace of the capital was not compromised.

The value of shares in the Louisiana, or Mississippi stock, had fallen
very rapidly, and few indeed were found to believe the tales that had
once been told of the immense wealth of that region. A last effort was
therefore tried to restore the public confidence in the Mississippi
project. For this purpose, a general conscription of all the poor
wretches in Paris was made by order of government. Upwards of six
thousand of the very refuse of the population were impressed, as if in
time of war, and were provided with clothes and tools to be embarked
for New Orleans, to work in the gold mines alleged to abound there.
They were paraded day after day through the streets with their pikes and
shovels, and then sent off in small detachments to the out-ports to be
shipped for America. Two-thirds of them never reached their destination,
but dispersed themselves over the country, sold their tools for what
they could get, and returned to their old course of life. In less than
three weeks afterwards, one-half of them were to be found again in
Paris. The manoeuvre, however, caused a trifling advance in Mississippi
stock. Many persons of superabundant gullibility believed that
operations had begun in earnest in the new Golconda, and that gold and
silver ingots would again be found in France.

In a constitutional monarchy some surer means would have been found for
the restoration of public credit. In England, at a subsequent period,
when a similar delusion had brought on similar distress, how
different were the measures taken to repair the evil; but in France,
unfortunately, the remedy was left to the authors of the mischief.
The arbitrary will of the Regent, which endeavoured to extricate the
country, only plunged it deeper into the mire. All payments were ordered
to be made in paper, and between the 1st of February and the end of
May, notes were fabricated to the amount of upwards of 1500 millions of
livres, or 60,000,000 pounds sterling. But the alarm once sounded, no
art could make the people feel the slightest confidence in paper which
was not exchangeable into metal. M. Lambert, the President of the
Parliament of Paris, told the Regent to his face that he would rather
have a hundred thousand livres in gold or silver than five millions
in the notes of his bank. When such was the general feeling, the
superabundant issues of paper but increased the evil, by rendering still
more enormous the disparity between the amount of specie and notes in
circulation. Coin, which it was the object of the Regent to depreciate,
rose in value on every fresh attempt to diminish it. In February, it
was judged advisable that the Royal Bank should be incorporated with
the Company of the Indies. An edict to that effect was published and
registered by the Parliament. The state remained the guarantee for the
notes of the bank, and no more were to be issued without an order in
council. All the profits of the bank, since the time it had been taken
out of Law's hands and made a national institution, were given over by
the Regent to the Company of the Indies. This measure had the effect of
raising for a short time the value of the Louisiana and other shares
of the company, but it failed in placing public credit on any permanent
basis.

A council of state was held in the beginning of May, at which Law,
D'Argenson (his colleague in the administration of the finances), and
all the ministers were present. It was then computed that the total
amount of notes in circulation was 2600 millions of livres, while the
coin in the country was not quite equal to half that amount. It was
evident to the majority of the council that some plan must be adopted to
equalise the currency. Some proposed that the notes should be reduced to
the value of the specie, while others proposed that the nominal value of
the specie should be raised till it was on an equality with the
paper. Law is said to have opposed both these projects, but failing in
suggesting any other, it was agreed that the notes should be depreciated
one-half. On the 21st of May, an edict was accordingly issued, by which
it was decreed that the shares of the Company of the Indies, and the
notes of the bank, should gradually diminish in value, till at the end
of a year they should only pass current for one half of their nominal
worth. The Parliament refused to register the edict--the greatest outcry
was excited, and the state of the country became so alarming, that, as
the only means of preserving tranquillity, the council of the regency
was obliged to stultify its own proceedings, by publishing within seven
days another edict, restoring the notes to their original value.

On the same day (the 27th of May) the bank stopped payment in specie.
Law and D'Argenson were both dismissed from the ministry. The weak,
vacillating, and cowardly Regent threw the blame of all the mischief
upon Law, who, upon presenting himself at the Palais Royal, was refused
admitance. At nightfall, however, he was sent for, and admitted into the
palace by a secret door,[Duclos, Memoires Secrets de la Regence.] when
the Regent endeavoured to console him, and made all manner of excuses
for the severity with which in public he had been compelled to treat
him. So capricious was his conduct, that, two days afterwards, he took
him publicly to the opera, where he sat in the royal box, alongside of
the Regent, who treated him with marked consideration in face of all the
people. But such was the hatred against Law that the experiment had well
nigh proved fatal to him. The mob assailed his carriage with stones
just as he was entering his own door; and if the coachman had not made
a sudden jerk into the court-yard, and the domestics closed the gate
immediately, he would, in all probability, have been dragged out and
torn to pieces. On the following day, his wife and daughter were also
assailed by the mob as they were returning in their carriage from the
races. When the Regent was informed of these occurrences he sent Law a
strong detachment of Swiss guards, who were stationed night and day in
the court of his residence. The public indignation at last increased so
much, that Law, finding his own house, even with this guard, insecure,
took refuge in the Palais Royal, in the apartments of the Regent.

The Chancellor, D'Aguesseau, who had been dismissed in 1718 for his
opposition to the projects of Law, was now recalled to aid in the
restoration of credit. The Regent acknowledged too late, that he had
treated with unjustifiable harshness and mistrust one of the ablest,
and perhaps the sole honest public man of that corrupt period. He had
retired ever since his disgrace to his country-house at Fresnes, where,
in the midst of severe but delightful philosophic studies, he had
forgotten the intrigues of an unworthy court. Law himself, and the
Chevalier de Conflans, a gentleman of the Regent's household, were
despatched in a post-chaise, with orders to bring the ex-chancellor to
Paris along with them. D'Aguesseau consented to render what assistance
he could, contrary to the advice of his friends, who did not approve
that he should accept any recall to office of which Law was the bearer.
On his arrival in Paris, five counsellors of the Parliament were
admitted to confer with the Commissary of Finance, and on the 1st of
June an order was published, abolishing the law which made it criminal
to amass coin to the amount of more than five hundred livres. Every one
was permitted to have as much specie as he pleased. In order that the
bank-notes might be withdrawn, twenty-five millions of new notes were
created, on the security of the revenues of the city of Paris, at
two-and-a-half per cent. The bank-notes withdrawn were publicly burned
in front of the Hotel de Ville. The new notes were principally of
the value of ten livres each; and on the 10th of June the bank was
re-opened, with a sufficiency of silver coin to give in change for them.

These measures were productive of considerable advantage. All the
population of Paris hastened to the bank, to get coin for their small
notes; and silver becoming scarce, they were paid in copper. Very few
complained that this was too heavy, although poor fellows might be
continually seen toiling and sweating along the streets, laden with
more than they could comfortably carry, in the shape of change for fifty
livres. The crowds around the bank were so great, that hardly a day
passed that some one was not pressed to death. On the 9th of July, the
multitude was so dense and clamorous that the guards stationed at the
entrance of the Mazarin Gardens closed the gate, and refused to admit
any more. The crowd became incensed, and flung stones through the
railings upon the soldiers. The latter, incensed in their turn,
threatened to fire upon the people. At that instant one of them was hit
by a stone, and, taking up his piece, he fired into the crowd. One man
fell dead immediately, and another was severely wounded. It was every
instant expected that a general attack would have been commenced upon
the bank; but the gates of the Mazarin Gardens being opened to the
crowd, who saw a whole troop of soldiers, with their bayonets fixed,
ready to receive them, they contented themselves by giving vent to their
indignation in groans and hisses.

Eight days afterwards the concourse of people was so tremendous, that
fifteen persons were squeezed to death at the doors of the bank.
The people were so indignant that they took three of the bodies on
stretchers before them, and proceeded, to the number of seven or eight
thousand, to the gardens of the Palais Royal, that they might show the
Regent the misfortunes that he and Law had brought upon the country.
Law's coachman, who was sitting on the box of his master's carriage,
in the court-yard of the palace, happened to have more zeal than
discretion, and, not liking that the mob should abuse his master, he
said, loud enough to be overheard by several persons, that they were
all blackguards, and deserved to be hanged. The mob immediately set upon
him, and, thinking that Law was in the carriage, broke it to pieces. The
imprudent coachman narrowly escaped with his life. No further mischief
was done; a body of troops making their appearance, the crowd quietly
dispersed, after an assurance had been given by the Regent that the
three bodies they had brought to show him should be decently buried at
his own expense. The Parliament was sitting at the time of this uproar,
and the President took upon himself to go out and see what was the
matter. On his return he informed the councillors, that Law's carriage
had been broken by the mob. All the members rose simultaneously, and
expressed their joy by a loud shout, while one man, more zealous in
his hatred than the rest, exclaimed, "And Law himself, is he torn to
pieces?" [The Duchess of Orleans gives a different version of this
story; but whichever be the true one, the manifestation of such feeling
in a legislative assembly was not very creditable. She says, that the
President was so transported with joy, that he was seized with a rhyming
fit, and, returning into the hall, exclaimed to the members:--

     "Messieurs! Messieurs! bonne nouvelle!
     Le carfosse de Lass est reduit en canelle!"]

Much undoubtedly depended on the credit of the Company of the Indies,
which was answerable for so great a sum to the nation. It was,
therefore, suggested in the council of the ministry, that any privileges
which could be granted to enable it to fulfil its engagements, would be
productive of the best results. With this end in view, it was proposed
that the exclusive privilege of all maritime commerce should be
secured to it, and an edict to that effect was published. But it was
unfortunately forgotten that by such a measure all the merchants of
the country would be ruined. The idea of such an immense privilege was
generally scouted by the nation, and petition on petition was presented
to the Parliament, that they would refuse to register the decree. They
refused accordingly, and the Regent, remarking that they did nothing but
fan the flame of sedition, exiled them to Blois. At the intercession
of D'Aguesseau, the place of banishment was changed to Pontoise, and
thither accordingly the councillors repaired, determined to set the
Regent at defiance. They made every arrangement for rendering their
temporary exile as agreeable as possible. The President gave the most
elegant suppers, to which he invited all the gayest and wittiest company
of Paris. Every night there was a concert and ball for the ladies. The
usually grave and solemn judges and councillors joined in cards
and other diversions, leading for several weeks a life of the most
extravagant pleasure, for no other purpose than to show the Regent of
how little consequence they deemed their banishment, and that when they
willed it, they could make Pontoise a pleasanter residence than Paris.

Of all the nations in the world the French are the most renowned for
singing over their grievances. Of that country it has been remarked with
some truth, that its whole history may be traced in its songs. When Law,
by the utter failure of his best-laid plans, rendered himself obnoxious,
satire of course seized hold upon him, and, while caricatures of his
person appeared in all the shops, the streets resounded with songs, in
which neither he nor the Regent was spared. Many of these songs were far
from decent; and one of them in particular counselled the application of
all his notes to the most ignoble use to which paper can be applied. But
the following, preserved in the letters of the Duchess of Orleans, was
the best and the most popular, and was to be heard for months in all the
carrefours of Paris. The application of the chorus is happy enough:--

     Aussitot que Lass arriva
     Dans notre bonne ville,
     Monsieur le Regent publia
     Que Lass serait utile
     Pour retablir la nation.
     La faridondaine! la faridondon.
     Mais il nous a tous enrich!,
     Biribi!
     A la facon de Barbari,
     Mort ami!

     Ce parpaillot, pour attirer
     Tout l'argent de la France,
     Songea d'abord a s'assurer
     De notre confiance.
     Il fit son abjuration.
     La faridondaine! la faridondon!
     Mais le fourbe s'est converti,
     Biribi!
     A la facon de Barbari,
     Mon ami!

     Lass, le fils aine de Satan
     Nous met tous a l'aumone,
     Il nous a pris tout notre argent
     Et n'en rend a personne.
     Mais le Regent, humain et bon,
     La faridondaine! la faridondon!
     Nous rendra ce qu'on nous a pris,
     Biribi!
     A la facon de Barbari,
     Mon ami!

The following smart epigram is of the same date:--

     Lundi, j'achetai des actions;
     Mardi, je gagnai des millions;
     Mercredi, j'arrangeai mon menage,
     Jeudi, je pris un equipage,
     Vendredi, je m'en fus au bal,
     Et Samedi, a l'Hopital.

Among the caricatures that were abundantly published, and that showed
as plainly as graver matters, that the nation had awakened to a sense of
its folly, was one, a fac-simile of which is preserved in the "Memoires
de la Regence." It was thus described by its author: "The 'Goddess of
Shares," in her triumphal car, driven by the Goddess of Folly. Those
who are drawing the car are impersonations of the Mississippi, with his
wooden leg, the South Sea, the Bank of England, the Company of the West
of Senegal, and of various assurances. Lest the car should not roll fast
enough, the agents of these companies, known by their long fox-tails and
their cunning looks, turn round the spokes of the wheels, upon which are
marked the names of the several stocks, and their value, sometimes high
and sometimes low, according to the turns of the wheel. Upon the ground
are the merchandise, day-books and ledgers of legitimate commerce,
crushed under the chariot of Folly. Behind is an immense crowd of
persons, of all ages, sexes, and conditions, clamoring after Fortune,
and fighting with each other to get a portion of the shares which she
distributes so bountifully among them. In the clouds sits a demon,
blowing bubbles of soap, which are also the objects of the admiration
and cupidity of the crowd, who jump upon one another's backs to reach
them ere they burst. Right in the pathway of the car, and blocking up
the passage, stands a large building, with three doors, through one of
which it must pass, if it proceeds further, and all the crowd along
with it. Over the first door are the words, "Hopital des Foux," over the
second, "Hopital des Malades," and over the third, "Hopital des Gueux."
Another caricature represented Law sitting in a large cauldron,
boiling over the flames of popular madness, surrounded by an impetuous
multitude, who were pouring all their gold and silver into it, and
receiving gladly in exchange the bits of paper which he distributed
among them by handsfull.

While this excitement lasted, Law took good care not to expose himself
unguarded in the streets. Shut up in the apartments of the Regent, he
was secure from all attack, and, whenever he ventured abroad, it was
either incognito, or in one of the Royal carriages, with a powerful
escort. An amusing anecdote is recorded of the detestation in which he
was held by the people, and the ill treatment he would have met, had
he fallen into their hands. A gentleman, of the name of Boursel, was
passing in his carriage down the Rue St. Antoine, when his further
progress was stayed by a hackneycoach that had blocked up the road. M.
Boursel's servant called impatiently to the hackneycoachman to get out
of the way, and, on his refusal, struck him a blow on the face. A crowd
was soon drawn together by the disturbance, and M. Boursel got out of
the carriage to restore order. The hackney-coachman, imagining that he
had now another assailant, bethought him of an expedient to rid himself
of both, and called out as loudly as he was able, "Help! help! murder!
murder! Here are Law and his servant going to kill me! Help! help!"
At this cry, the people came out of their shops, armed with sticks
and other weapons, while the mob gathered stones to inflict summary
vengeance upon the supposed financier. Happily for M. Boursel and his
servant, the door of the church of the Jesuits stood wide open, and,
seeing the fearful odds against them, they rushed towards it with all
speed. They reached the altar, pursued by the people, and would have
been ill treated even there, if, finding the door open leading to the
sacristy, they had not sprang through, and closed it after them. The
mob were then persuaded to leave the church by the alarmed and indignant
priests; and, finding M. Boursel's carriage still in the streets, they
vented their ill-will against it, and did it considerable damage.

The twenty-five millions secured on the municipal revenues of the city
of Paris, bearing so low an interest as two and a half per cent., were
not very popular among the large holders of Mississippi stock. The
conversion of the securities was, therefore, a work of considerable
difficulty; for many preferred to retain the falling paper of Law's
Company, in the hope that a favourable turn might take place. On the
15th of August, with a view to hasten the conversion, an edict was
passed, declaring that all notes for sums between one thousand and ten
thousand livres; should not pass current, except for the purchase of
annuities and bank accounts, or for the payment of instalments still due
on the shares of the company.

In October following another edict was passed, depriving these notes
of all value whatever after the month of November next ensuing. The
management of the mint, the farming of the revenue, and all the other
advantages and privileges of the India, or Mississippi Company, were
taken from them, and they were reduced to a mere private company. This
was the deathblow to the whole system, which had now got into the hands
of its enemies. Law had lost all influence in the Council of Finance,
and the company, being despoiled of its immunities, could no longer hold
out the shadow of a prospect of being able to fulfil its engagements.
All those suspected of illegal profits at the time the public delusion
was at its height, were sought out and amerced in heavy fines. It was
previously ordered that a list of the original proprietors should be
made out, and that such persons as still retained their shares should
place them in deposit with the company, and that those who had neglected
to complete the shares for which they had put down their names, should
now purchase them of the company, at the rate of 13,500 livres for each
share of 500 livres. Rather than submit to pay this enormous sum for
stock which was actually at a discount, the shareholders packed up all
their portable effects, and endeavoured to find a refuge in foreign
countries. Orders were immediately issued to the authorities at the
ports and frontiers, to apprehend all travellers who sought to leave the
kingdom, and keep them in custody, until it was ascertained whether
they had any plate or jewellery with them, or were concerned in the late
stock-jobbing. Against such few as escaped, the punishment of death was
recorded, while the most arbitrary proceedings were instituted against
those who remained.

Law himself, in a moment of despair, determined to leave a country where
his life was no longer secure. He at first only demanded permission to
retire from Paris to one of his country-seats; a permission which the
Regent cheerfully granted. The latter was much affected at the unhappy
turn affairs had taken, but his faith continued unmoved in the truth
and efficacy of Law's financial system. His eyes were opened to his own
errors, and during the few remaining years of his life, he constantly
longed for an opportunity of again establishing the system upon a
securer basis. At Law's last interview with the Prince, he is reported
to have said--"I confess that I have committed many faults; I committed
them because I am a man, and all men are liable to error; but I
declare to you most solemnly that none of them proceeded from wicked
or dishonest motives, and that nothing of the kind will be found in the
whole course of my conduct."

Two or three days after his departure the Regent sent him a very kind
letter, permitting him to leave the kingdom whenever he pleased, and
stating that he had ordered his passports to be made ready. He at
the same time offered him any sum of money he might require. Law
respectfully declined the money, and set out for Brussels in a
postchaise belonging to Madame de Prie, the mistress of the Duke of
Bourbon, escorted by six horse-guards. From thence he proceeded to
Venice, where he remained for some months, the object of the greatest
curiosity to the people, who believed him to be the possessor of
enormous wealth. No opinion, however, could be more erroneous. With
more generosity than could have been expected from a man who during the
greatest part of his life had been a professed gambler, he had refused
to enrich himself at the expense of a ruined nation. During the height
of the popular frenzy for Mississippi stock, he had never doubted of
the final success of his projects, in making France the richest and most
powerful nation of Europe. He invested all his gains in the purchase
of landed property in France--a sure proof of his own belief in the
stability of his schemes. He had hoarded no plate or jewellery, and sent
no money, like the dishonest jobbers, to foreign countries. His all,
with the exception of one diamond, worth about five or six thousand
pounds sterling, was invested in the French soil; and when he left that
country, he left it almost a beggar. This fact alone ought to rescue
his memory from the charge of knavery, so often and so unjustly brought
against him.

As soon as his departure was known, all his estates and his valuable
library were confiscated. Among the rest, an annuity of 200,000 livres,
(8000 pounds sterling,) on the lives of his wife and children, which
had been purchased for five millions of livres, was forfeited,
notwithstanding that a special edict, drawn up for the purpose in the
days of his prosperity, had expressly declared that it should never be
confiscated for any cause whatever. Great discontent existed among the
people that Law had been suffered to escape. The mob and the Parliament
would have been pleased to have seen him hanged. The few who had not
suffered by the commercial revolution, rejoiced that the quack had
left the country; but all those (and they were by far the most numerous
class) whose fortunes were implicated, regretted that his intimate
knowledge of the distress of the country, and of the causes that had led
to it, had not been rendered more available in discovering a remedy.

At a meeting of the Council of Finance, and the general council of the
Regency, documents were laid upon the table, from which it appeared that
the amount of notes in circulation was 2700 millions. The Regent was
called upon to explain how it happened that there was a discrepancy
between the dates at which these issues were made, and those of the
edicts by which they were authorised. He might have safely taken the
whole blame upon himself, but he preferred that an absent man should
bear a share of it, and he therefore stated that Law, upon his own
authority, had issued 1200 millions of notes at different times, and
that he (the Regent) seeing that the thing had been irrevocably done,
had screened Law, by antedating the decrees of the council, which
authorised the augmentation. It would have been more to his credit if he
had told the whole truth while he was about it, and acknowledged that
it was mainly through his extravagance and impatience that Law had
been induced to overstep the bounds of safe speculation. It was also
ascertained that the national debt, on the 1st of January, 1721,
amounted to upwards of $100 millions of livres, or more than 124,000,000
pounds sterling, the interest upon which was 3,196,000 pounds. A
commission, or visa, was forthwith appointed to examine into all the
securities of the state creditors, who were to be divided into five
classes, the first four comprising those who had purchased their
securities with real effects, and the latter comprising those who could
give no proofs that the transactions they had entered into were real and
bona fide. The securities of the latter were ordered to be destroyed,
while those of the first four classes were subjected to a most rigid and
jealous scrutiny. The result of the labours of the visa was a report,
in which they counselled the reduction of the interest upon these
securities to fifty-six millions of livres. They justified this advice
by a statement of the various acts of peculation and extortion which
they had discovered, and an edict to that effect was accordingly
published and duly registered by the parliaments of the kingdom.

Another tribunal was afterwards established, under the title of the
Chambre de l'Arsenal, which took cognizance of all the malversations
committed in the financial departments of the government during the late
unhappy period. A Master of Requests, named Falhonet, together with
the Abbe Clement, and two clerks in their employ, had been concerned
in divers acts of peculation, to the amount of upwards of a million of
livres. The first two were sentenced to be beheaded, and the latter
to be hanged; but their punishment was afterwards commuted into
imprisonment for life in the Bastile. Numerous other acts of dishonesty
were discovered, and punished by fine and imprisonment.

D'Argenson shared with Law and the Regent the unpopularity which had
alighted upon all those concerned in the Mississippi madness. He was
dismissed from his post of Chancellor, to make room for D'Aguesseau; but
he retained the title of Keeper of the Seals, and was allowed to attend
the councils whenever he pleased. He thought it better, however, to
withdraw from Paris, and live for a time a life of seclusion at his
country-seat. But he was not formed for retirement, and becoming moody
and discontented, he aggravated a disease under which he had long
laboured, and died in less than a twelvemonth. The populace of of Paris
so detested him, that they carried their hatred even to his grave.
As his funeral procession passed to the church of St. Nicholas du
Chardonneret, the burying-place of his family, it was beset by a riotous
mob, and his two sons, who were following as chief-mourners, were
obliged to drive as fast as they were able down a by-street to escape
personal violence.

As regards Law, he for some time entertained a hope that he should be
recalled to France, to aid in establishing its credit upon a firmer
basis. The death of the Regent, in 1723, who expired suddenly, as he
was sitting by the fireside conversing with his mistress, the Duchess
de Phalaris, deprived him of that hope, and he was reduced to lead
his former life of gambling. He was more than once obliged to pawn
his diamond, the sole remnant of his vast wealth, but successful play
generally enabled him to redeem it. Being persecuted by his creditors at
Rome, he proceeded to Copenhagen, where he received permission from the
English ministry to reside in his native country, his pardon for the
murder of Mr. Wilson having been sent over to him in 1719. He was
brought over in the admiral's ship, a circumstance which gave occasion
for a short debate in the House of Lords. Earl Coningsby complained that
a man, who had renounced both his country and his religion, should
have been treated with such honour, and expressed his belief that his
presence in England, at a time when the people were so bewildered by the
nefarious practices of the South Sea directors, would be attended with
no little danger. He gave notice of a motion on the subject; but it
was allowed to drop, no other member of the House having the slightest
participation in his lordship's fears. Law remained for about four years
in England, and then proceeded to Venice, where he died in 1729, in
very embarrassed circumstances. The following epitaph was written at the
time:--

     "Ci git cet Ecossais celebre,
     Ce calculateur sans egal,
     Qui, par les regles de l'algebre,
     A mis la France a l'Hopital."

His brother, William Law, who had been concerned with him in the
administration both of the Bank and the Louisiana Company, was
imprisoned in the Bastile for alleged malversation, but no guilt was
ever proved against him. He was liberated after fifteen months, and
became the founder of a family, which is still known in France under the
title of Marquises of Lauriston.

In the next chapter will be found an account of the madness which
infected the people of England at the same time, and under very similar
circumstances, but which, thanks to the energies and good sense of a
constitutional government, was attended with results far less disastrous
than those which were seen in France.




THE SOUTH SEA BUBBLE

     At length corruption, like a general flood,
     Did deluge all, and avarice creeping on,
     Spread, like a low-born mist, and hid the sun.
     Statesmen and patriots plied alike the stocks,
     Peeress and butler shared alike the box;
     And judges jobbed, and bishops bit the town,
     And mighty dukes packed cards for half-a-crown:
     Britain was sunk in lucre's sordid charms.
     --Pope.

The South Sea Company was originated by the celebrated Harley, Earl
of Oxford, in the year 1711, with the view of restoring public credit,
which had suffered by the dismissal of the Whig ministry, and of
providing for the discharge of the army and navy debentures, and other
parts of the floating debt, amounting to nearly ten millions sterling.
A company of merchants, at that time without a name, took this debt
upon themselves, and the government agreed to secure them, for a certain
period, the interest of six per cent. To provide for this interest,
amounting to 600,000 pounds per annum, the duties upon wines, vinegar,
India goods, wrought silks, tobacco, whale-fins, and some other
articles, were rendered permanent. The monopoly of the trade to the
South Seas was granted, and the company, being incorporated by Act of
Parliament, assumed the title by which it has ever since been known. The
minister took great credit to himself for his share in this transaction,
and the scheme was always called by his flatterers "the Earl of Oxford's
masterpiece."

Even at this early period of its history, the most visionary ideas
were formed by the company and the public of the immense riches of the
eastern coast of South America. Everybody had heard of the gold
and silver mines of Peru and Mexico; every one believed them to be
inexhaustible, and that it was only necessary to send the manufactures
of England to the coast, to be repaid a hundredfold in gold and silver
ingots by the natives. A report, industriously spread, that Spain was
willing to concede four ports, on the coasts of Chili and Peru, for
the purposes of traffic, increased the general confidence; and for many
years the South Sea Company's stock was in high favour.

Philip V of Spain, however, never had any intention of admitting the
English to a free trade in the ports of Spanish America. Negotiations
were set on foot, but their only result was the assiento contract, or
the privilege of supplying the colonies with negroes for thirty years,
and of sending once a year a vessel, limited both as to tonnage and
value of cargo, to trade with Mexico, Peru, or Chili. The latter
permission was only granted upon the hard condition, that the King of
Spain should enjoy one-fourth of the profits, and a tax of five per
cent. on the remainder. This was a great disappointment to the Earl of
Oxford and his party, who were reminded much oftener than they found
agreeable of the

     "Parturiunt montes, nascitur ridiculus mus."

But the public confidence in the South Sea Company was not shaken. The
Earl of Oxford declared, that Spain would permit two ships, in addition
to the annual ship, to carry out merchandise during the first year;
and a list was published, in which all the ports and harbours of these
coasts were pompously set forth as open to the trade of Great Britain.
The first voyage of the annual ship was not made till the year 1717,
and in the following year the trade was suppressed by the rupture with
Spain.

The King's speech, at the opening of the session of 1717, made pointed
allusion to the state of public credit, and recommended that proper
measures should be taken to reduce the national debt. The two great
monetary corporations, the South Sea Company and the Bank of England,
made proposals to Parliament on the 20th of May ensuing. The South
Sea Company prayed that their capital stock of ten millions might be
increased to twelve, by subscription or otherwise, and offered to accept
five per cent. instead of six upon the whole amount. The Bank made
proposals equally advantageous. The House debated for some time, and
finally three acts were passed, called the South Sea Act, the Bank Act,
and the General Fund Act. By the first, the proposals of the South Sea
Company were accepted, and that body held itself ready to advance the
sum of two millions towards discharging the principal and interest of
the debt due by the state for the four lottery funds of the ninth and
tenth years of Queen Anne. By the second act, the Bank received a lower
rate of interest for the sum of 1,775,027 pounds 15 shillings due to it
by the state, and agreed to deliver up to be cancelled as many Exchequer
bills as amounted to two millions sterling, and to accept of an annuity
of one hundred thousand pounds, being after the rate of five per cent,
the whole redeemable at one year's notice. They were further required
to be ready to advance, in case of need, a sum not exceeding 2,500,000
pounds upon the same terms of five per cent interest, redeemable by
Parliament. The General Fund Act recited the various deficiencies, which
were to be made good by the aids derived from the foregoing sources.

The name of the South Sea Company was thus continually before the
public. Though their trade with the South American States produced
little or no augmentation of their revenues, they continued to flourish
as a monetary corporation. Their stock was in high request, and the
directors, buoyed up with success, began to think of new means for
extending their influence. The Mississippi scheme of John Law, which
so dazzled and captivated the French people, inspired them with an
idea that they could carry on the same game in England. The anticipated
failure of his plans did not divert them from their intention. Wise in
their own conceit, they imagined they could avoid his faults, carry on
their schemes for ever, and stretch the cord of credit to its extremest
tension, without causing it to snap asunder.

It was while Law's plan was at its greatest height of popularity, while
people were crowding in thousands to the Rue Quincampoix, and ruining
themselves with frantic eagerness, that the South Sea directors laid
before Parliament their famous plan for paying off the national debt.
Visions of boundless wealth floated before the fascinated eyes of the
people in the two most celebrated countries of Europe. The English
commenced their career of extravagance somewhat later than the French;
but as soon as the delirium seized them, they were determined not to be
outdone. Upon the 22nd of January 1720, the House of Commons resolved
itself into a Committee of the whole House, to take into consideration
that part of the King's speech at the opening of the session which
related to the public debts, and the proposal of the South Sea Company
towards the redemption and sinking of the same. The proposal set forth
at great length, and under several heads, the debts of the state,
amounting to 30,981,712 pounds, which the Company were anxious to take
upon themselves, upon consideration of five per cent. per annum, secured
to them until Midsummer 1727; after which time, the whole was to become
redeemable at the pleasure of the legislature, and the interest to be
reduced to four per cent. The proposal was received with great favour;
but the Bank of England had many friends in the House of Commons, who
were desirous that that body should share in the advantages that were
likely to accrue. On behalf of this corporation it was represented, that
they had performed great and eminent services to the state, in the most
difficult times, and deserved, at least, that if any advantage was to be
made by public bargains of this nature, they should be preferred before
a company that had never done any thing for the nation. The further
consideration of the matter was accordingly postponed for five days.
In the mean time, a plan was drawn up by the Governors of the Bank.
The South Sea Company, afraid that the Bank might offer still more
advantageous terms to the government than themselves, reconsidered their
former proposal, and made some alterations in it, which they hoped would
render it more acceptable. The principal change was a stipulation that
the government might redeem these debts at the expiration of four years,
instead of seven, as at first suggested. The Bank resolved not to be
outbidden in this singular auction, and the Governors also reconsidered
their first proposal, and sent in a new one.

Thus, each corporation having made two proposals, the House began to
deliberate. Mr. Robert Walpole was the chief speaker in favour of the
Bank, and Mr. Aislabie, the Chancellor of the Exchequer, the principal
advocate on behalf of the South Sea Company. It was resolved, on the 2nd
of February, that the proposals of the latter were most advantageous
to the country. They were accordingly received, and leave was given to
bring in a bill to that effect.

Exchange Alley was in a fever of excitement. The Company's stock, which
had been at a hundred and thirty the previous day, gradually rose to
three hundred, and continued to rise with the most astonishing rapidity
during the whole time that the bill in its several stages was under
discussion. Mr. Walpole was almost the only statesman in the House who
spoke out boldly against it. He warned them, in eloquent and solemn
language, of the evils that would ensue. It countenanced, he said, "the
dangerous practice of stockjobbing, and would divert the genius of the
nation from trade and industry. It would hold out a dangerous lure to
decoy the unwary to their ruin, by making them part with the earnings of
their labour for a prospect of imaginary wealth." The great principle
of the project was an evil of first-rate magnitude; it was to raise
artificially the value of the stock, by exciting and keeping up a
general infatuation, and by promising dividends out of funds which could
never be adequate to the purpose. In a prophetic spirit he added,
that if the plan succeeded, the directors would become masters of the
government, form a new and absolute aristocracy in the kingdom, and
control the resolutions of the legislature. If it failed, which he was
convinced it would, the result would bring general discontent and ruin
upon the country. Such would be the delusion, that when the evil day
came, as come it would, the people would start up, as from a dream, and
ask themselves if these things could have been true. All his eloquence
was in vain. He was looked upon as a false prophet, or compared to the
hoarse raven, croaking omens of evil. His friends, however, compared him
to Cassandra, predicting evils which would only be believed when they
came home to men's hearths, and stared them in the face at their own
boards. Although, in former times, the House had listened with the
utmost attention to every word that fell from his lips, the benches
became deserted when it was known that he would speak on the South Sea
question.

The bill was two months in its progress through the House of Commons.
During this time every exertion was made by the directors and their
friends, and more especially by the Chairman, the noted Sir John Blunt,
to raise the price of the stock. The most extravagant rumours were in
circulation. Treaties between England and Spain were spoken of, whereby
the latter was to grant a free trade to all her colonies; and the rich
produce of the mines of Potosi-la-Paz was to be brought to England until
silver should become almost as plentiful as iron. For cotton and woollen
goods, with which we could supply them in abundance, the dwellers
in Mexico were to empty their golden mines. The company of merchants
trading to the South Seas would be the richest the world ever saw, and
every hundred pounds invested in it would produce hundreds per annum
to the stockholder. At last the stock was raised by these means to
near four hundred; but, after fluctuating a good deal, settled at three
hundred and thirty, at which price it remained when the bill passed the
Commons by a majority of 172 against 55.

In the House of Lords the bill was hurried through all its stages with
unexampled rapidity. On the 4th of April it was read a first time; on
the 5th, it was read a second time; on the 6th, it was committed; and on
the 7th, was read a third time, and passed.

Several peers spoke warmly against the scheme; but their warnings fell
upon dull, cold ears. A speculating frenzy had seized them as well
as the plebeians. Lord North and Grey said the bill was unjust in its
nature, and might prove fatal in its consequences, being calculated to
enrich the few and impoverish the many. The Duke of Wharton followed;
but, as he only retailed at second-hand the arguments so eloquently
stated by Walpole in the Lower House, he was not listened to with even
the same attention that had been bestowed upon Lord North and Grey. Earl
Cowper followed on the same side, and compared the bill to the famous
horse of the siege of Troy. Like that, it was ushered in and received
with great pomp and acclamations of joy, but bore within it treachery
and destruction. The Earl of Sunderland endeavoured to answer all
objections; and, on the question being put, there appeared only
seventeen peers against, and eighty-three in favour of the project.
The very same day on which it passed the Lords, it received the Royal
assent, and became the law of the land.

It seemed at that time as if the whole nation had turned stockjobbers.
Exchange Alley was every day blocked up by crowds, and Cornhill was
impassable for the number of carriages. Everybody came to purchase
stock. "Every fool aspired to be a knave." In the words of a ballad,
published at the time, and sung about the streets, ["A South Sea Ballad;
or, Merry Remarks upon Exchange Alley Bubbles. To a new tune, called
'The Grand Elixir; or, the Philosopher's Stone Discovered.'"]

     Then stars and garters did appear
     Among the meaner rabble;
     To buy and sell, to see and hear,
     The Jews and Gentiles squabble.

     The greatest ladies thither came,
     And plied in chariots daily,
     Or pawned their jewels for a sum
     To venture in the Alley.

The inordinate thirst of gain that had afflicted all ranks of society,
was not to be slaked even in the South Sea. Other schemes, of the most
extravagant kind, were started. The share-lists were speedily filled up,
and an enormous traffic carried on in shares, while, of course, every
means were resorted to, to raise them to an artificial value in the
market.

Contrary to all expectation, South Sea stock fell when the bill received
the Royal assent. On the 7th of April the shares were quoted at three
hundred and ten, and on the following day, at two hundred and ninety.
Already the directors had tasted the profits of their scheme, and it was
not likely that they should quietly allow the stock to find its natural
level, without an effort to raise it. Immediately their busy emissaries
were set to work. Every person interested in the success of the
project endeavoured to draw a knot of listeners around him, to whom he
expatiated on the treasures of the South American seas. Exchange Alley
was crowded with attentive groups. One rumour alone, asserted with the
utmost confidence, had an immediate effect upon the stock. It was said,
that Earl Stanhope had received overtures in France from the Spanish
Government to exchange Gibraltar and Port Mahon for some places on the
coast of Peru, for the security and enlargement of the trade in the
South Seas. Instead of one annual ship trading to those ports, and
allowing the King of Spain twenty-five per cent. out of the profits, the
Company might build and charter as many ships as they pleased, and pay
no per centage whatever to any foreign potentate.

Visions of ingots danced before their eyes, and stock rose rapidly.
On the 12th of April, five days after the bill had become law, the
directors opened their books for a subscription of a million, at the
rate of 300 pounds for every 100 pounds capital. Such was the concourse
of persons, of all ranks, that this first subscription was found to
amount to above two millions of original stock. It was to be paid at
five payments, of 60 pounds each for every 100 pounds. In a few days the
stock advanced to three hundred and forty, and the subscriptions were
sold for double the price of the first payment. To raise the stock still
higher, it was declared, in a general court of directors, on the 21st of
April, that the midsummer dividend should be ten per cent., and that
all subscriptions should be entitled to the same. These resolutions
answering the end designed, the directors, to improve the infatuation
of the monied men, opened their books for a second subscription of a
million, at four hundred per cent. Such was the frantic eagerness of
people of every class to speculate in these funds, that in the course
of a few hours no less than a million and a half was subscribed at that
rate.

In the mean time, innumerable joint-stock companies started up
everywhere. They soon received the name of Bubbles, the most appropriate
that imagination could devise. The populace are often most happy in the
nicknames they employ. None could be more apt than that of Bubbles. Some
of them lasted for a week, or a fortnight, and were no more heard of,
while others could not even live out that short span of existence.
Every evening produced new schemes, and every morning new projects. The
highest of the aristocracy were as eager in this hot pursuit of gain
as the most plodding jobber in Cornhill. The Prince of Wales became
governor of one company, and is said to have cleared 40,000 pounds by
his speculations. [Coxe's Walpole, Correspondence between Mr. Secretary
Craggs and Earl Stanhope.] The Duke of Bridgewater started a scheme
for the improvement of London and Westminster, and the Duke of Chandos
another. There were nearly a hundred different projects, each more
extravagant and deceptive than the other. To use the words of the
"Political State," they were "set on foot and promoted by crafty knaves,
then pursued by multitudes of covetous fools, and at last appeared to
be, in effect, what their vulgar appellation denoted them to be--bubbles
and mere cheats." It was computed that near one million and a half
sterling was won and lost by these unwarrantable practices, to the
impoverishment of many a fool, and the enriching of many a rogue.

Some of these schemes were plausible enough, and, had they been
undertaken at a time when the public mind was unexcited, might have
been pursued with advantage to all concerned. But they were established
merely with the view of raising the shares in the market. The projectors
took the first opportunity of a rise to sell out, and next morning
the scheme was at an end. Maitland, in his History of London, gravely
informs us, that one of the projects which received great encouragement,
was for the establishment of a company "to make deal-boards out of
saw-dust." This is, no doubt, intended as a joke; but there is
abundance of evidence to show that dozens of schemes hardly a whir more
reasonable, lived their little day, ruining hundreds ere they fell.
One of them was for a wheel for perpetual motion--capital, one million;
another was "for encouraging the breed of horses in England, and
improving of glebe and church lands, and repairing and rebuilding
parsonage and vicarage houses." Why the clergy, who were so mainly
interested in the latter clause, should have taken so much interest in
the first, is only to be explained on the supposition that the scheme
was projected by a knot of the foxhunting parsons, once so common in
England. The shares of this company were rapidly subscribed for. But the
most absurd and preposterous of all, and which showed, more completely
than any other, the utter madness of the people, was one, started by an
unknown adventurer, entitled "company for carrying on an undertaking
of great advantage, but nobody to know what it is." Were not the fact
stated by scores of credible witnesses, it would be impossible to
believe that any person could have been duped by such a project. The
man of genius who essayed this bold and successful inroad upon public
credulity, merely stated in his prospectus that the required capital was
half a million, in five thousand shares of 100 pounds each, deposit 2
pounds per share. Each subscriber, paying his deposit, would be entitled
to 100 pounds per annum per share. How this immense profit was to
be obtained, he did not condescend to inform them at that time, but
promised, that in a month full particulars should be duly announced,
and a call made for the remaining 98 pounds of the subscription. Next
morning, at nine o'clock, this great man opened an office in Cornhill.
Crowds of people beset his door, and when he shut up at three o'clock,
he found that no less than one thousand shares had been subscribed for,
and the deposits paid. He was thus, in five hours, the winner of 2,000
pounds. He was philosopher enough to be contented with his venture, and
set off the same evening for the Continent. He was never heard of again.

Well might Swift exclaim, comparing Change Alley to a gulf in the South
Sea,--

     Subscribers here by thousands float,
     And jostle one another down,
     Each paddling in his leaky boat,
     And here they fish for gold, and drown.

     Now buried in the depths below,
     Now mounted up to heaven again,
     They reel and stagger to and fro,
     At their wit's end, like drunken men

     Meantime, secure on Garraway cliffs,
     A savage race, by shipwrecks fed,
     Lie waiting for the foundered skiffs,
     And strip the bodies of the dead.

Another fraud that was very successful, was that of the "Globe Permits,"
as they were called. They were nothing more than square pieces of
playing cards, on which was the impression of a seal, in wax, bearing
the sign of the Globe Tavern, in the neighbourhood of Exchange Alley,
with the inscription of "Sail Cloth Permits." The possessors enjoyed no
other advantage from them than permission to subscribe, at some future
time, to a new sail-cloth manufactory, projected by one who was then
known to be a man of fortune, but who was afterwards involved in the
peculation and punishment of the South Sea directors. These permits sold
for as much as sixty guineas in the Alley.

Persons of distinction, of both sexes, were deeply engaged in all these
bubbles, those of the male sex going to taverns and coffee-houses to
meet their brokers, and the ladies resorting for the same purpose to
the shops of milliners and haberdashers. But it did not follow that all
these people believed in the feasibility of the schemes to which they
subscribed; it was enough for their purpose that their shares would, by
stock-jobbing arts, be soon raised to a premium, when they got rid
of them with all expedition to the really credulous. So great was the
confusion of the crowd in the alley, that shares in the same bubble were
known to have been sold at the same instant ten per cent. higher at
one end of the alley than at the other. Sensible men beheld the
extraordinary infatuation of the people with sorrow and alarm. There
were some, both in and out of Parliament, who foresaw clearly the ruin
that was impending. Mr. Walpole did not cease his gloomy forebodings.
His fears were shared by all the thinking few, and impressed most
forcibly upon the government. On the 11th of June, the day the
Parliament rose, the King published a proclamation, declaring that
all these unlawful projects should be deemed public nuisances, and
prosecuted accordingly, and forbidding any broker, under a penalty
of five hundred pounds, from buying or selling any shares in them.
Notwithstanding this proclamation, roguish speculators still carried
them on, and the deluded people still encouraged them. On the 12th of
July, an order of the Lords Justices assembled in privy council was
published, dismissing all the petitions that had been presented for
patents and charters, and dissolving all the bubble companies. The
following copy of their lordships' order, containing a list of all these
nefarious projects, will not be deemed uninteresting at the present day,
when there is but too much tendency in the public mind to indulge in
similar practices:--

"At the Council Chamber, Whitehall, the 12th day of July, 1720. Present,
their Excellencies the Lords Justices in Council.

"Their Excellencies, the Lords Justices in council, taking into
consideration the many inconveniences arising to the public from several
projects set on foot for raising of joint stock for various purposes,
and that a great many of his Majesty's subjects have been drawn in to
part with their money on pretence of assurances that their petitions
for patents and charters, to enable them to carry on the same, would
be granted: to prevent such impositions, their Excellencies, this day,
ordered the said several petitions, together with such reports from the
Board of Trade, and from his Majesty's Attorney and Solicitor General,
as had been obtained thereon, to be laid before them, and after mature
consideration thereof, were pleased, by advice of his Majesty's Privy
Council, to order that the said petitions be dismissed, which are as
follow:--

"1. Petition of several persons, praying letters patent for carrying on
a fishing trade, by the name of the Grand Fishery of Great Britain.

"2. Petition of the Company of the Royal Fishery of England, praying
letters patent for such further powers as will effectually contribute to
carry on the said fishery.

"3. Petition of George James, on behalf of himself and divers persons of
distinction concerned in a national fishery; praying letters patent of
incorporation to enable them to carry on the same.

"4. Petition of several merchants, traders, and others, whose names
are thereunto subscribed, praying to be incorporated for reviving and
carrying on a whale fishery to Greenland and elsewhere.

"5. Petition of Sir John Lambert, and others thereto subscribing, on
behalf of themselves and a great number of merchants, praying to be
incorporated for carrying on a Greenland trade, and particularly a whale
fishery in Davis's Straits.

"6. Another petition for a Greenland trade.

"7. Petition of several merchants, gentlemen, and citizens, praying to
be incorporated, for buying and building of ships to let or freight.

"8. Petition of Samuel Antrim and others, praying for letters patent for
sowing hemp and flax.

"9. Petition of several merchants, masters of ships, sail-makers, and
manufacturers of sail-cloth, praying a charter of incorporation, to
enable them to carry on and promote the said manufactory by a joint
stock.

"10. Petition of Thomas Boyd, and several hundred merchants, owners
and masters of ships, sailmakers, weavers, and other traders, praying a
charter of incorporation, empowering them to borrow money for purchasing
lands, in order to the manufacturing sail-cloth and fine Holland.

"11. Petition on behalf of several persons interested in a patent
granted by the late King William and Queen Mary, for the making of linen
and sail-cloth, praying that no charter may be granted to any persons
whatsoever for making sail-cloth, but that the privilege now enjoyed by
them may be confirmed, and likewise an additional power to carry on the
cotton and cotton-silk manufactures.

"12. Petition of several citizens, merchants, and traders in London,
and others, subscribers to a British stock, for a general insurance from
fire in any part of England, praying to be incorporated for carrying on
the said undertaking.

"13. Petition of several of his Majesty's loyal subjects of the city of
London, and other parts of Great Britain, praying to be incorporated,
for carrying on a general insurance from losses by fire within the
kingdom of England.

"14. Petition of Thomas Burges, and others his Majesty's subjects
thereto subscribing, in behalf of themselves and others, subscribers
to a fund of 1,200,000 pounds, for carrying on a trade to his Majesty's
German dominions, praying to be incorporated, by the name of the Harburg
Company.

"15. Petition of Edward Jones, a dealer in timber, on behalf of himself
and others, praying to be incorporated for the importation of timber
from Germany.

"16. Petition of several merchants of London, praying a charter of
incorporation for carrying on a salt-work.

"17. Petition of Captain Macphedris, of London, merchant, on behalf
of himself and several merchants, clothiers, hatters, dyers, and other
traders, praying a charter of incorporation, empowering them to raise
a sufficient sum of money to purchase lands for planting and rearing a
wood called madder, for the use of dyers.

"18. Petition of Joseph Galendo, of London, snuff-maker, praying a
patent for his invention to prepare and cure Virginia tobacco for
snuff in Virginia, and making it into the same in all his Majesty's
dominions."




LIST OF BUBBLES.

The following Bubble Companies were by the same order declared to be
illegal, and abolished accordingly:--

1. For the importation of Swedish iron.

2. For supplying London with sea-coal. Capital, three millions.

3. For building and rebuilding houses throughout all England. Capital,
three millions.

4. For making of muslin.

5. For carrying on and improving the British alum works.

6. For effectually settling the island of Blanco and Sal Tartagus.

7. For supplying the town of Deal with fresh water.

8. For the importation of Flanders lace.

9. For improvement of lands in Great Britain. Capital, four millions.

10. For encouraging the breed of horses in England, and improving of
glebe and church lands, and for repairing and rebuilding parsonage and
vicarage houses.

11. For making of iron and steel in Great Britain.

12. For improving the land in the county of Flint. Capital, one million.

13. For purchasing lands to build on. Capital, two millions.

14. For trading in hair.

15. For erecting salt-works in Holy Island. Capital, two millions.

16. For buying and selling estates, and lending money on mortgage.

17. For carrying on an undertaking of great advantage, but nobody to
know what it is.

18. For paving the streets of London. Capital, two millions.

19. For furnishing funerals to any part of Great Britain.

20. For buying and selling lands and lending money at interest. Capital,
five millions.

21. For carrying on the Royal Fishery of Great Britain. Capital, ten
millions.

22. For assuring of seamen's wages.

23. For erecting loan-offices for the assistance and encouragement of
the industrious. Capital, two millions.

24. For purchasing and improving leasable lands. Capital, four millions.

25. For importing pitch and tar, and other naval stores, from North
Britain and America.

26. For the clothing, felt, and pantile trade.

27. For purchasing and improving a manor and royalty in Essex.

28. For insuring of horses. Capital, two millions.

29. For exporting the woollen manufacture, and importing copper, brass,
and iron. Capital, four millions.

30. For a grand dispensary. Capital, three millions.

31. For erecting mills and purchasing lead mines. Capital, two millions.

32. For improving the art of making soap.

33. For a settlement on the island of Santa Cruz.

34. For sinking pits and smelting lead ore in Derbyshire.

35. For making glass bottles and other glass.

36. For a wheel for perpetual motion. Capital, one million.

37. For improving of gardens.

38. For insuring and increasing children's fortunes.

39. For entering and loading goods at the custom-house, and for
negotiating business for merchants.

40. For carrying on a woollen manufacture in the north of England.

41. For importing walnut-trees from Virginia. Capital, two millions.

42. For making Manchester stuffs of thread and cotton.

43. For making Joppa and Castile soap.

44. For improving the wrought-iron and steel manufactures of this
kingdom. Capital, four millions.

45. For dealing in lace, Hollands, cambrics, lawns, &c. Capital, two
millions.

46. For trading in and improving certain commodities of the produce of
this kingdom, &c. Capital, three millions.

47. For supplying the London markets with cattle.

48. For making looking-glasses, coach glasses, &c. Capital, two
millions.

49. For working the tin and lead mines in Cornwall and Derbyshire.

50. For making rape-oil.

51. For importing beaver fur. Capital, two millions.

52. For making pasteboard and packing-paper.

53. For importing of oils and other materials used in the woollen
manufacture.

54. For improving and increasing the silk manufactures.

55. For lending money on stock, annuities, tallies, &c.

56. For paying pensions to widows and others, at a small discount.
Capital, two millions.

57. For improving malt liquors. Capital, four millions.

58. For a grand American fishery.

59. For purchasing and improving the fenny lands in Lincolnshire.
Capital, two millions.

60. For improving the paper manufacture of Great Britain.

61. The Bottomry Company.

62. For drying malt by hot air.

63. For carrying on a trade in the river Oronooko.

64. For the more effectual making of baize, in Colchester and other
parts of Great Britain.

65. For buying of naval stores, supplying the victualling, and paying
the wages of the workmen.

66. For employing poor artificers, and furnishing merchants and others
with watches.

67. For improvement of tillage and the breed of cattle.

68. Another for the improvement of our breed of horses.

69. Another for a horse-insurance.

70. For carrying on the corn trade of Great Britain.

71. For insuring to all masters and mistresses the losses they may
sustain by servants. Capital, three millions.

72. For erecting houses or hospitals, for taking in and maintaining
illegitimate children. Capital, two millions.

73. For bleaching coarse sugars, without the use of fire or loss of
substance.

74. For building turnpikes and wharfs in Great Britain.

75. For insuring from thefts and robberies.

76. For extracting silver from lead.

77. For making China and Delft ware. Capital, one million.

78. For importing tobacco, and exporting it again to Sweden and the
north of Europe. Capital, four millions.

79. For making iron with pit coal.

80. For furnishing the cities of London and Westminster with hay and
straw. Capital, three millions.

81. For a sail and packing cloth manufactory in Ireland.

82. For taking up ballast.

83. For buying and fitting out ships to suppress pirates.

84. For the importation of timber from Wales. Capital, two millions.

85. For rock-salt.

86. For the transmutation of quicksilver into a malleable fine metal.

Besides these bubbles, many others sprang up daily, in spite of the
condemnation of the Government and the ridicule of the still sane
portion of the public. The print-shops teemed with caricatures, and
the newspapers with epigrams and satires, upon the prevalent folly. An
ingenious card-maker published a pack of South Sea playing-cards, which
are now extremely rare, each card containing, besides the usual figures,
of a very small size, in one corner, a caricature of a bubble company,
with appropriate verses underneath. One of the most famous bubbles
was "Puckle's Machine Company," for discharging round and square
cannon-balls and bullets, and making a total revolution in the art of
war. Its pretensions to public favour were thus summed up, on the eight
of spades:--

     A rare invention to destroy the crowd
     Of fools at home, instead of fools abroad.
     Fear not, my friends, this terrible machine,
     They're only wounded who have shares therein.

     The nine of hearts was a caricature of the English Copper and Brass
     Company, with the following epigram:--

     The headlong fool that wants to be a swopper
     Of gold and silver coin for English copper,
     May, in Change Alley, prove himself an ass,
     And give rich metal for adulterate brass.

     The eight of diamonds celebrated the Company for the Colonization of
     Acadia, with this doggrel:--

     He that is rich and wants to fool away
     A good round sum in North America,
     Let him subscribe himself a headlong sharer,
     And asses' ears shall honour him or bearer.

And in a similar style every card of the pack exposed some knavish
scheme, and ridiculed the persons who were its dupes. It was computed
that the total amount of the sums proposed for carrying on these
projects was upwards of three hundred millions sterling, a sum so
immense that it exceeded the value of all the lands in England at twenty
years' purchase.

It is time, however, to return to the great South Sea gulf, that
swallowed the fortunes of so many thousands of the avaricious and the
credulous. On the 29th of May, the stock had risen as high as five
hundred, and about two-thirds of the government annuitants had exchanged
the securities of the state for those of the South Sea Company. During
the whole of the month of May the stock continued to rise, and on the
28th it was quoted at five hundred and fifty. In four days after this it
took a prodigious leap, rising suddenly from five hundred and fifty to
eight hundred and ninety. It was now the general opinion that the stock
could rise no higher, and many persons took that opportunity of selling
out, with a view of realising their profits. Many noblemen and persons
in the train of the King, and about to accompany him to Hanover, were
also anxious to sell out. So many sellers, and so few buyers, appeared
in the Alley on the 3rd of June, that the stock fell at once from eight
hundred and ninety to six hundred and forty. The directors were alarmed,
and gave their agents orders to buy. Their efforts succeeded. Towards
evening confidence was restored, and the stock advanced to seven hundred
and fifty. It continued at this price, with some slight fluctuation,
until the company closed their books on the 22nd of June.

It would be needless and uninteresting to detail the various arts
employed by the directors to keep up the price of stock. It will be
sufficient to state that it finally rose to one thousand per cent. It
was quoted at this price in the commencement of August. The bubble
was then full-blown, and began to quiver and shake, preparatory to its
bursting.

Many of the government annuitants expressed dissatisfaction against the
directors. They accused them of partiality in making out the lists for
shares in each subscription. Further uneasiness was occasioned by
its being generally known that Sir John Blunt, the chairman, and some
others, had sold out. During the whole of the month of August the stock
fell, and on the 2nd of September it was quoted at seven hundred only.

The state of things now became alarming. To prevent, if possible,
the utter extinction of public confidence in their proceedings, the
directors summoned a general court of the whole corporation, to meet in
Merchant Tailors' Hall, on the 8th of September. By nine o'clock in the
morning, the room was filled to suffocation; Cheapside was blocked up
by a crowd unable to gain admittance, and the greatest excitement
prevailed. The directors and their friends mustered in great numbers.
Sir John Fellowes, the sub-governor, was called to the chair. He
acquainted the assembly with the cause of their meeting, read to them
the several resolutions of the court of directors, and gave them an
account of their proceedings; of the taking in the redeemable and
unredeemable funds, and of the subscriptions in money. Mr. Secretary
Craggs then made a short speech, wherein he commended the conduct of the
directors, and urged that nothing could more effectually contribute to
the bringing this scheme to perfection than union among themselves. He
concluded with a motion for thanking the court of directors for their
prudent and skilful management, and for desiring them to proceed in such
manner as they should think most proper for the interest and advantage
of the corporation. Mr. Hungerford, who had rendered himself very
conspicuous in the House of Commons for his zeal in behalf of the South
Sea Company, and who was shrewdly suspected to have been a considerable
gainer by knowing the right time to sell out, was very magniloquent on
this occasion. He said that he had seen the rise and fall, the decay
and resurrection of many communities of this nature, but that, in his
opinion, none had ever performed such wonderful things in so short a
time as the South Sea Company. They had done more than the crown, the
pulpit, or the bench could do. They had reconciled all parties in one
common interest; they had laid asleep, if not wholly extinguished, all
the domestic jars and animosities of the nation. By the rise of their
stock, monied men had vastly increased their fortunes; country-gentlemen
had seen the value of their lands doubled and trebled in their hands.
They had at the same time done good to the Church, not a few of the
reverend clergy having got great sums by the project. In short, they
had enriched the whole nation, and he hoped they had not forgotten
themselves. There was some hissing at the latter part of this speech,
which for the extravagance of its eulogy was not far removed from
satire; but the directors and their friends, and all the winners in
the room, applauded vehemently. The Duke of Portland spoke in a
similar strain, and expressed his great wonder why anybody should be
dissatisfied: of course, he was a winner by his speculations, and in
a condition similar to that of the fat alderman in Joe Miller's Jests,
who, whenever he had eaten a good dinner, folded his hands upon his
paunch, and expressed his doubts whether there could be a hungry man in
the world.

Several resolutions were passed at this meeting, but they had no effect
upon the public. Upon the very same evening the stock fell to six
hundred and forty, and on the morrow to five hundred and forty. Day
after day it continued to fall, until it was as low as four hundred.
In a letter dated September 13th, from Mr. Broderick, M.P. to Lord
Chancellor Middleton, and published in Coxo's Walpole, the former
says,--"Various are the conjectures why the South Sea directors have
suffered the cloud to break so early. I made no doubt but they would do
so when they found it to their advantage. They have stretched credit
so far beyond what it would bear, that specie proves insufficient
to support it. Their most considerable men have drawn out, securing
themselves by the losses of the deluded, thoughtless numbers, whose
understandings have been overruled by avarice and the hope of making
mountains out of mole-hills. Thousands of families will be reduced
to beggary. The consternation is inexpressible--the rage beyond
description, and the case altogether so desperate that I do not see any
plan or scheme so much as thought of for averting the blow, so that I
cannot pretend to guess what is next to be done." Ten days afterwards,
the stock still falling, he writes,--"The Company have yet come to no
determination, for they are in such a wood that they know not which way
to turn. By several gentlemen lately come to town, I perceive the very
name of a South-Sea-man grows abominable in every country. A great many
goldsmiths are already run off, and more will daily. I question
whether one-third, nay, one-fourth, of them can stand it. From the
very beginning, I founded my judgment of the whole affair upon the
unquestionable maxim, that ten millions (which is more than our running
cash) could not circulate two hundred millions, beyond which our paper
credit extended. That, therefore, whenever that should become doubtful,
be the cause what it would, our noble state machine must inevitably fall
to the ground."

On the 12th of September, at the earnest solicitation of Mr. Secretary
Craggs, several conferences were held between the directors of the South
Sea and the directors of the Bank. A report which was circulated,
that the latter had agreed to circulate six millions of the South Sea
Company's bonds, caused the stock to rise to six hundred and seventy;
but in the afternoon, as soon as the report was known to be groundless,
the stock fell again to five hundred and eighty; the next day to five
hundred and seventy, and so gradually to four hundred. [Gay (the poet),
in that disastrous year, had a present from young Craggs of some South
Sea stock, and once supposed himself to be master of twenty thousand
pounds. His friends persuaded him to sell his share, but he dreamed of
dignity and splendour, and could not bear to obstruct his own fortune.
He was then importuned to sell as much as would purchase a hundred a
year for life, "which," says Fenton, "will make you sure of a clean
shirt and a shoulder of mutton every day." This counsel was rejected;
the profit and principal were lost, and Gay sunk under the calamity so
low that his life became in danger.--Johnson's Lives of the Poets.]

The ministry were seriously alarmed at the aspect of affairs. The
directors could not appear in the streets without being insulted;
dangerous riots were every moment apprehended. Despatches were sent off
to the King at Hanover, praying his immediate return. Mr. Walpole, who
was staying at his country-seat, was sent for, that he might employ his
known influence with the directors of the Bank of England to induce them
to accept the proposal made by the South Sea Company for circulating a
number of their bonds.

The Bank was very unwilling to mix itself up with the affairs of the
Company; it dreaded being involved in calamities which it could not
relieve, and received all overtures with visible reluctance. But the
universal voice of the nation called upon it to come to the rescue.
Every person of note in commercial politics was called in to advise in
the emergency. A rough draft of a contract drawn up by Mr. Walpole was
ultimately adopted as the basis of further negotiations, and the public
alarm abated a little.

On the following day, the 20th of September, a general court of
the South Sea Company was held at Merchant Tailors' Hall, in which
resolutions were carried, empowering the directors to agree with the
Bank of England, or any other persons, to circulate the Company's
bonds, or make any other agreement with the Bank which they should think
proper. One of the speakers, a Mr. Pulteney, said it was most surprising
to see the extraordinary panic which had seized upon the people. Men
were running to and fro in alarm and terror, their imaginations filled
with some great calamity, the form and dimensions of which nobody knew.

     "Black it stood as night--
     Fierce as ten furies--terrible as hell."

At a general court of the Bank of England held two days afterwards, the
governor informed them of the several meetings that had been held on the
affairs of the South Sea Company, adding that the directors had not yet
thought fit to come to any decision upon the matter. A resolution was
then proposed, and carried without a dissentient voice, empowering the
directors to agree with those of the South Sea to circulate their bonds,
to what sum, and upon what terms, and for what time, they might think
proper.

Thus both parties were at liberty to act as they might judge best for
the public interest. Books were opened at the Bank for a subscription of
three millions for the support of public credit, on the usual terms of
15 pounds per cent. deposit, per cent. premium, and 5 pounds per cent.
interest. So great was the concourse of people in the early part of
the morning, all eagerly bringing their money, that it was thought the
subscription would be filled that day; but before noon, the tide
turned. In spite of all that could be done to prevent it, the South Sea
Company's stock fell rapidly. Their bonds were in such discredit, that a
run commenced upon the most eminent goldsmiths and bankers, some of whom
having lent out great sums upon South Sea stock were obliged to shut up
their shops and abscond. The Sword-blade Company, who had hitherto been
the chief cashiers of the South Sea Company, stopped payment. This being
looked upon as but the beginning of evil, occasioned a great run upon
the Bank, who were now obliged to pay out money much faster than they
had received it upon the subscription in the morning. The day succeeding
was a holiday (the 29th of September), and the Bank had a little
breathing time. They bore up against the storm; but their former rivals,
the South Sea Company, were wrecked upon it. Their stock fell to one
hundred and fifty, and gradually, after various fluctuations, to one
hundred and thirty-five.

The Bank, finding they were not able to restore public confidence, and
stem the tide of ruin, without running the risk of being swept away with
those they intended to save, declined to carry out the agreement into
which they had partially entered. They were under no obligation whatever
to continue; for the so called Bank contract was nothing more than the
rough draught of an agreement, in which blanks had been left for
several important particulars, and which contained no penalty for their
secession. "And thus," to use the words of the Parliamentary History,
"were seen, in the space of eight months, the rise, progress, and fall
of that mighty fabric, which, being wound up by mysterious springs to a
wonderful height, had fixed the eyes and expectations of all Europe,
but whose foundation, being fraud, illusion, credulity, and infatuation,
fell to the ground as soon as the artful management of its directors was
discovered."

In the hey-day of its blood, during the progress of this dangerous
delusion, the manners of the nation became sensibly corrupted. The
Parliamentary inquiry, set on foot to discover the delinquents,
disclosed scenes of infamy, disgraceful alike to the morals of the
offenders and the intellects of the people among whom they had arisen.
It is a deeply interesting study to investigate all the evils that were
the result. Nations, like individuals, cannot become desperate gamblers
with impunity. Punishment is sure to overtake them sooner or later. A
celebrated writer [Smollett.] is quite wrong, when he says, "that such
an era as this is the most unfavourable for a historian; that no reader
of sentiment and imagination can be entertained or interested by a
detail of transactions such as these, which admit of no warmth, no
colouring, no embellishment; a detail of which only serves to exhibit
an inanimate picture of tasteless vice and mean degeneracy." On the
contrary, and Smollett might have discovered it, if he had been in the
humour--the subject is capable of inspiring as much interest as even a
novelist can desire. Is there no warmth in the despair of a plundered
people?--no life and animation in the picture which might be drawn of
the woes of hundreds of impoverished and ruined families? of the
wealthy of yesterday become the beggars of to-day? of the powerful
and influential changed into exiles and outcasts, and the voice of
self-reproach and imprecation resounding from every corner of the land?
Is it a dull or uninstructive picture to see a whole people shaking
suddenly off the trammels of reason, and running wild after a golden
vision, refusing obstinately to believe that it is not real, till, like
a deluded hind running after an ignis fatuus, they are plunged into a
quagmire? But in this false spirit has history too often been written.
The intrigues of unworthy courtiers to gain the favour of still more
unworthy kings; or the records of murderous battles and sieges have
been dilated on, and told over and over again, with all the eloquence
of style and all the charms of fancy; while the circumstances which have
most deeply affected the morals and welfare of the people, have been
passed over with but slight notice as dry and dull, and capable of
neither warmth nor colouring.

During the progress of this famous bubble, England presented a singular
spectacle. The public mind was in a state of unwholesome fermentation.
Men were no longer satisfied with the slow but sure profits of cautious
industry. The hope of boundless wealth for the morrow made them
heedless and extravagant for to-day. A luxury, till then unheard-of, was
introduced, bringing in its train a corresponding laxity of morals. The
overbearing insolence of ignorant men, who had arisen to sudden wealth
by successful gambling, made men of true gentility of mind and manners,
blush that gold should have power to raise the unworthy in the scale of
society. The haughtiness of some of these "cyphering cits," as they were
termed by Sir Richard Steele, was remembered against them in the day
of their adversity. In the Parliamentary inquiry, many of the directors
suffered more for their insolence than for their peculation. One of
them, who, in the full-blown pride of an ignorant rich man, had said
that he would feed his horse upon gold, was reduced almost to bread and
water for himself; every haughty look, every overbearing speech, was set
down, and repaid them a hundredfold in poverty and humiliation.

The state of matters all over the country was so alarming, that George
I shortened his intended stay in Hanover, and returned in all haste to
England. He arrived on the 11th of November, and Parliament was summoned
to meet on the 8th of December. In the mean time, public meetings were
held in every considerable town of the empire, at which petitions were
adopted, praying the vengeance of the Legislature upon the South Sea
directors, who, by their fraudulent practices, had brought the nation to
the brink of ruin. Nobody seemed to imagine that the nation itself was
as culpable as the South Sea Company. Nobody blamed the credulity and
avarice of the people,--the degrading lust of gain, which had swallowed
up every nobler quality in the national character, or the infatuation
which had made the multitude run their heads with such frantic eagerness
into the net held out for them by scheming projectors. These things were
never mentioned. The people were a simple, honest, hard-working people,
ruined by a gang of robbers, who were to be hanged, drawn, and quartered
without mercy.

This was the almost unanimous feeling of the country. The two Houses of
Parliament were not more reasonable. Before the guilt of the South
Sea directors was known, punishment was the only cry. The King, in his
speech from the throne, expressed his hope that they would remember that
all their prudence, temper, and resolution were necessary to find out
and apply the proper remedy for their misfortunes. In the debate on the
answer to the address, several speakers indulged in the most violent
invectives against the directors of the South Sea project. The Lord
Molesworth was particularly vehement. "It had been said by some, that
there was no law to punish the directors of the South Sea Company, who
were justly looked upon as the authors of the present misfortunes of
the state. In his opinion they ought, upon this occasion, to follow the
example of the ancient Romans, who, having no law against parricide,
because their legislators supposed no son could be so unnaturally wicked
as to embrue his hands in his father's blood, made a law to punish this
heinous crime as soon as it was committed. They adjudged the guilty
wretch to be sown in a sack, and thrown alive into the Tyber. He looked
upon the contrivers and executors of the villanous South Sea scheme as
the parricides of their country, and should be satisfied to see them
tied in like manner in sacks, and thrown into the Thames." Other members
spoke with as much want of temper and discretion. Mr. Walpole was more
moderate. He recommended that their first care should be to restore
public credit. "If the city of London were on fire, all wise men would
aid in extinguishing the flames, and preventing the spread of the
conflagration before they inquired after the incendiaries. Public credit
had received a dangerous wound, and lay bleeding, and they ought to
apply a speedy remedy to it. It was time enough to punish the assassin
afterwards." On the 9th of December an address, in answer to his
Majesty's speech, was agreed upon, after an amendment, which was
carried without a division, that words should be added expressive of the
determination of the House not only to seek a remedy for the national
distresses, but to punish the authors of them.

The inquiry proceeded rapidly. The directors were ordered to lay before
the House a full account of all their proceedings. Resolutions were
passed to the effect that the calamity was mainly owing to the vile
arts of stockjobbers, and that nothing could tend more to the
re-establishment of public credit than a law to prevent this infamous
practice. Mr. Walpole then rose, and said, that "as he had previously
hinted, he had spent some time upon a scheme for restoring public
credit, but that, the execution of it depending upon a position which
had been laid down as fundamental, he thought it proper, before he
opened out his scheme, to be informed whether he might rely upon
that foundation. It was, whether the subscription of public debts and
encumbrances, money subscriptions, and other contracts, made with the
South Sea Company should remain in the present state?" This question
occasioned an animated debate. It was finally agreed, by a majority of
259 against 117, that all these contracts should remain in their present
state, unless altered for the relief of the proprietors by a general
court of the South Sea Company, or set aside by due course of law. On
the following day Mr. Walpole laid before a committee of the whole
House his scheme for the restoration of public credit, which was, in
substance, to ingraft nine millions of South Sea stock into the Bank
of England, and the same sum into the East India Company, upon certain
conditions. The plan was favourably received by the House. After some
few objections, it was ordered that proposals should be received from
the two great corporations. They were both unwilling to lend their aid,
and the plan met with a warm but fruitless opposition at the general
courts summoned for the purpose of deliberating upon it. They, however,
ultimately agreed upon the terms on which they would consent to
circulate the South Sea bonds, and their report, being presented to
the committee, a bill was brought in, under the superintendence of Mr.
Walpole, and safely carried through both Houses of Parliament.

A bill was at the same time brought in, for restraining the South Sea
directors, governor, sub-governor, treasurer, cashier, and clerks from
leaving the kingdom for a twelvemonth, and for discovering their estates
and effects, and preventing them from transporting or alienating the
same. All the most influential members of the House supported the bill.
Mr. Shippen, seeing Mr. Secretary Craggs in his place, and believing
the injurious rumours that were afloat of that minister's conduct in the
South Sea business, determined to touch him to the quick. He said, he
was glad to see a British House of Commons resuming its pristine vigour
and spirit, and acting with so much unanimity for the public good.
It was necessary to secure the persons and estates of the South Sea
directors and their officers; "but," he added, looking fixedly at Mr.
Craggs as he spoke, "there were other men in high station, whom, in
time, he would not be afraid to name, who were no less guilty than
the directors." Mr. Craggs arose in great wrath, and said, that if the
innuendo were directed against him, he was ready to give satisfaction to
any man who questioned him, either in the House or out of it. Loud cries
of order immediately arose on every side. In the midst of the uproar
Lord Molesworth got up, and expressed his wonder at the boldness of Mr.
Craggs in challenging the whole House of Commons. He, Lord Molesworth,
though somewhat old, past sixty, would answer Mr. Craggs whatever he
had to say in the House, and he trusted there were plenty of young men
beside him, who would not be afraid to look Mr. Craggs in the face, out
of the House. The cries of order again resounded from every side; the
members arose simultaneously; everybody seemed to be vociferating at
once. The Speaker in vain called order. The confusion lasted several
minutes, during which Lord Molesworth and Mr. Craggs were almost the
only members who kept their seats. At last the call for Mr. Craggs
became so violent that he thought proper to submit to the universal
feeling of the House, and explain his unparliamentary expression. He
said, that by giving satisfaction to the impugners of his conduct in
that House, he did not mean that he would fight, but that he would
explain his conduct. Here the matter ended, and the House proceeded to
debate in what manner they should conduct their inquiry into the affairs
of the South Sea Company, whether in a grand or a select committee.
Ultimately, a Secret Committee of thirteen was appointed, with power to
send for persons, papers, and records.

The Lords were as zealous and as hasty as the Commons. The Bishop
of Rochester said the scheme had been like a pestilence. The Duke of
Wharton said the House ought to show no respect of persons; that, for
his part, he would give up the dearest friend he had, if he had been
engaged in the project. The nation had been plundered in a most shameful
and flagrant manner, and he would go as far as anybody in the punishment
of the offenders. Lord Stanhope said, that every farthing possessed
by the criminals, whether directors or not directors, ought to be
confiscated, to make good the public losses.

During all this time the public excitement was extreme. We learn, front
Coxe's Walpole, that the very name of a South Sea director was thought
to be synonymous with every species of fraud and villany. Petitions
from counties, cities, and boroughs, in all parts of the kingdom, were
presented, crying for the justice due to an injured nation and the
punishment of the villanous peculators. Those moderate men, who would
not go to extreme lengths, even in the punishment of the guilty, were
accused of being accomplices, were exposed to repeated insults and
virulent invectives, and devoted, both in anonymous letters and public
writings, to the speedy vengeance of an injured people. The accusations
against Mr. Aislabie, Chancellor of the Exchequer, and Mr. Craggs,
another member of the ministry, were so loud, that the House of Lords
resolved to proceed at once into the investigation concerning them. It
was ordered, on the 21st of January, that all brokers concerned in the
South Sea scheme should lay before the House an account of the stock
or subscriptions bought or sold by them for any of the officers of the
Treasury or Exchequer, or in trust for any of them, since Michaelmas
1719. When this account was delivered, it appeared that large quantities
of stock had been transferred to the use of Mr. Aislabie. Five of the
South Sea directors, including Mr. Edward Gibbon, the grandfather of the
celebrated historian, were ordered into the custody of the black rod.
Upon a motion made by Earl Stanhope, it was unanimously resolved,
that the taking in or giving credit for stock without a valuable
consideration actually paid or sufficiently secured; or the purchasing
stock by any director or agent of the South Sea Company, for the use
or benefit of any member of the administration, or any member of either
House of Parliament, during such time as the South Sea Bill was yet
pending in Parliament, was a notorious and dangerous corruption. Another
resolution was passed a few days afterwards, to the effect that several
of the directors and officers of the Company having, in a clandestine
manner, sold their own stock to the Company, had been guilty of a
notorious fraud and breach of trust, and had thereby mainly caused the
unhappy turn of affairs that had so much affected public credit.
Mr. Aislabie resigned his office as Chancellor of the Exchequer, and
absented himself from Parliament until the formal inquiry into his
individual guilt was brought under the consideration of the Legislature.

In the mean time, Knight, the treasurer of the Company, and who was
intrusted with all the dangerous secrets of the dishonest directors,
packed up his books and documents, and made his escape from the country.
He embarked in disguise, in a small boat on the river, and proceeding
to a vessel hired for the purpose, was safely conveyed to Calais. The
Committee of Secrecy informed the House of the circumstance, when it was
resolved unanimously that two addresses should be presented to the King;
the first praying that he would issue a proclamation, offering a reward
for the apprehension of Knight; and the second, that he would give
immediate orders to stop the ports, and to take effectual care of the
coasts, to prevent the said Knight, or any other officers of the South
Sea Company, from escaping out of the kingdom. The ink was hardly
dry upon these addresses before they were carried to the King by Mr.
Methuen, deputed by the House for that purpose. The same evening a royal
proclamation was issued, offering a reward of two thousand pounds for
the apprehension of Knight. The Commons ordered the doors of the House
to be locked, and the keys to be placed upon the table. General Ross,
one of the members of the Committee of Secrecy, acquainted them that
they had already discovered a train of the deepest villany and fraud
that Hell had ever contrived to ruin a nation, which in due time they
would lay before the House. In the mean time, in order to a further
discovery, the Committee thought it highly necessary to secure the
persons of some of the directors and principal South Sea officers, and
to seize their papers. A motion to this effect having been made, was
carried unanimously. Sir Robert Chaplin, Sir Theodore Janssen, Mr.
Sawbridge, and Mr. F. Eyles, members of the House, and directors of the
South Sea Company, were summoned to appear in their places, and answer
for their corrupt practices. Sir Theodore Janssen and Mr. Sawbridge
answered to their names, and endeavoured to exculpate themselves. The
House heard them patiently, and then ordered them to withdraw. A motion
was then made, and carried nemine contradicente, that they had been
guilty of a notorious breach of trust--had occasioned much loss to great
numbers of his Majesty's subjects, and had highly prejudiced the public
credit. It was then ordered that, for their offence, they should be
expelled the House, and taken into the custody of the sergeant-at-arms.
Sir Robert Chaplin and Mr. Eyles, attending in their places four days
afterwards, were also expelled the House. It was resolved at the same
time to address the King, to give directions to his ministers at foreign
courts to make application for Knight, that he might be delivered up
to the English authorities, in ease he took refuge in any of their
dominions. The King at once agreed, and messengers were despatched to
all parts of the Continent the same night.

Among the directors taken into custody, was Sir John Blunt, the man whom
popular opinion has generally accused of having been the original author
and father of the scheme. This man, we are informed by Pope, in his
epistle to Allen, Lord Bathurst, was a dissenter, of a most religious
deportment, and professed to be a great believer. He constantly
declaimed against the luxury and corruption of the age, the partiality
of parliaments, and the misery of party spirit. He was particularly
eloquent against avarice in great and noble persons. He was originally
a scrivener, and afterwards became, not only a director, but the most
active manager of the South Sea Company. Whether it was during his
career in this capacity that he first began to declaim against the
avarice of the great, we are not informed. He certainly must have seen
enough of it to justify his severest anathema; but if the preacher had
himself been free from the vice he condemned, his declamations would
have had a better effect. He was brought up in custody to the bar of the
House of Lords, and underwent a long examination. He refused to answer
several important questions. He said he had been examined already by
a committee of the House of Commons, and as he did not remember his
answers, and might contradict himself, he refused to answer before
another tribunal. This declaration, in itself an indirect proof of
guilt, occasioned some commotion in the House. He was again asked
peremptorily whether he had ever sold any portion of the stock to
any member of the administration, or any member of either House of
Parliament, to facilitate the passing of the hill. He again declined to
answer. He was anxious, he said, to treat the House with all possible
respect, but he thought it hard to be compelled to accuse himself. After
several ineffectual attempts to refresh his memory, he was directed to
withdraw. A violent discussion ensued between the friends and opponents
of the ministry. It was asserted that the administration were no
strangers to the convenient taciturnity of Sir John Blunt. The Duke
of Wharton made a reflection upon the Earl Stanhope, which the latter
warmly resented. He spoke under great excitement, and with such
vehemence as to cause a sudden determination of blood to the head. He
felt himself so ill that he was obliged to leave the House and retire
to his chamber. He was cupped immediately, and also let blood on the
following morning, but with slight relief. The fatal result was not
anticipated. Towards evening he became drowsy, and turning himself on
his face, expired. The sudden death of this statesman caused great grief
to the nation. George I was exceedingly affected, and shut himself up
for some hours in his closet, inconsolable for his loss.

Knight, the treasurer of the company, was apprehended at Tirlemont, near
Liege, by one of the secretaries of Mr. Leathes, the British resident
at Brussels, and lodged in the citadel of Antwerp. Repeated applications
were made to the court of Austria to deliver him up, but in vain. Knight
threw himself upon the protection of the states of Brabant, and demanded
to be tried in that country. It was a privilege granted to the states
of Brabant by one of the articles of the Joyeuse Entree, that every
criminal apprehended in that country should be tried in that country.
The states insisted on their privilege, and refused to deliver Knight to
the British authorities. The latter did not cease their solicitations;
but in the mean time, Knight escaped from the citadel.

On the 16th of February the Committee of Secrecy made their first report
to the House. They stated that their inquiry had been attended with
numerous difficulties and embarrassments; every one they had examined
had endeavoured, as far as in him lay, to defeat the ends of justice. In
some of the books produced before them, false and fictitious entries had
been made; in others, there were entries of money, with blanks for the
name of the stockholders. There were frequent erasures and alterations,
and in some of the books leaves were torn out. They also found that some
books of great importance had been destroyed altogether, and that
some had been taken away or secreted. At the very entrance into their
inquiry, they had observed that the matters referred to them were of
great variety and extent. Many persons had been intrusted with various
parts in the execution of the law, and under colour thereof had acted
in an unwarrantable manner, in disposing of the properties of many
thousands of persons, amounting to many millions of money. They
discovered that, before the South Sea Act was passed, there was an entry
in the Company's books of the sum of 1,259,325 pounds, upon account of
stock stated to have been sold to the amount of 574,500 pounds. This
stock was all fictitious, and had been disposed of with a view to
promote the passing of the bill. It was noted as sold at various days,
and at various prices, from 150 to 325 per cent. Being surprised to see
so large an account disposed of, at a time when the Company were
not empowered to increase their capital, the committee determined
to investigate most carefully the whole transaction. The governor,
sub-governor, and several directors were brought before them, and
examined rigidly. They found that, at the time these entries were made,
the Company was not in possession of such a quantity of stock, having
in their own right only a small quantity, not exceeding thirty thousand
pounds at the utmost. Pursuing the inquiry, they found that this amount
of stock, was to be esteemed as taken in or holden by the Company, for
the benefit of the pretended purchasers, although no mutual agreement
was made for its delivery or acceptance at any certain time. No money
was paid down, nor any deposit or security whatever given to the Company
by the supposed purchasers; so that if the stock had fallen, as might
have been expected, had the act not passed, they would have sustained no
loss. If, on the contrary, the price of stock advanced (as it actually
did by the success of the scheme), the difference by the advanced price
was to be made good to them. Accordingly, after the passing of the act,
the account of stock was made up and adjusted with Mr. Knight, and the
pretended purchasers were paid the difference out of the Company's cash.
This fictitious stock, which had been chiefly at the disposal of Sir
John Blunt, Mr. Gibbon, and Mr. Knight, was distributed among several
members of the government and their connexions, by way of bribe, to
facilitate the passing of the bill. To the Earl of Sunderland was
assigned 50,000 pounds of this stock; to the Duchess of Kendal 10,000
pounds; to the Countess of Platen 10,000 pounds; to her two nieces
10,000 pounds; to Mr. Secretary Craggs 30,000 pounds; to Mr. Charles
Stanhope (one of the Secretaries of the Treasury) 10,000 pounds; to the
Swordblade Company 50,000 pounds. It also appeared that Mr. Stanhope
had received the enormous sum of 250,000 pounds as the difference in the
price of some stock, through the hands of Turner, Caswall, and Co., but
that his name had been partly erased from their books, and altered to
Stangape. Aislabie, the Chancellor of the Exchequer, had made profits
still more abominable. He had an account with the same firm, who were
also South Sea directors, to the amount of 794,451 pounds. He had,
besides, advised the Company to make their second subscription one
million and a half, instead of a million, by their own authority, and
without any warrant. The third subscription had been conducted in a
manner as disgraceful. Mr. Aislabie's name was down for 70,000 pounds;
Mr. Craggs, senior, for 659,000 pounds; the Earl of Sunderland's for
160,000 pounds; and Mr. Stanhope for 47,000 pounds. This report was
succeeded by six others, less important. At the end of the last, the
committee declared that the absence of Knight, who had been principally
intrusted, prevented them from carrying on their inquiries.

The first report was ordered to be printed, and taken into consideration
on the next day but one succeeding. After a very angry and animated
debate, a series of resolutions were agreed to, condemnatory of the
conduct of the directors, of the members of the Parliament and of the
administration concerned with them; and declaring that they ought, each
and all, to make satisfaction out of their own estates for the injury
they had done the public. Their practices were declared to be corrupt,
infamous, and dangerous; and a bill was ordered to be brought in for the
relief of the unhappy sufferers.

Mr. Charles Stanhope was the first person brought to account for his
share in these transactions. He urged in his defence that, for some
years past, he had lodged all the money he was possessed of in Mr.
Knight's hands, and whatever stock Mr. Knight had taken in for him, he
had paid a valuable consideration for it. As to the stock that had been
bought for him by Turner, Caswall, and Co. he knew nothing about it.
Whatever had been done in that matter was done without his authority,
and he could not be responsible for it. Turner and Co. took the latter
charge upon themselves, but it was notorious to every unbiased and
unprejudiced person that Mr. Stanhope was a gainer of the 250,000 pounds
which lay in the hands of that firm to his credit. He was, however,
acquitted by a majority of three only. The greatest exertions were made
to screen him. Lord Stanhope, the son of the Earl of Chesterfield, went
round to the wavering members, using all the eloquence he was possessed
of to induce them either to vote for the acquittal or to absent
themselves from the house. Many weak-headed country-gentlemen were led
astray by his persuasions, and the result was as already stated. The
acquittal caused the greatest discontent throughout the country. Mobs
of a menacing character assembled in different parts of London; fears
of riots were generally entertained, especially as the examination of
a still greater delinquent was expected by many to have a similar
termination. Mr. Aislabie, whose high office and deep responsibilities
should have kept him honest, even had native principle been
insufficient, was very justly regarded as perhaps the greatest criminal
of all. His case was entered into on the day succeeding the acquittal of
Mr. Starthope. Great excitement prevailed, and the lobbies and avenues
of the house were beset by crowds, impatient to know the result. The
debate lasted the whole day. Mr. Aislabie found few friends: his guilt
was so apparent and so heinous that nobody had courage to stand up in
his favour. It was finally resolved, without a dissentient voice, that
Mr. Aislabie had encouraged and promoted the destructive execution of
the South Sea scheme with a view to his own exorbitant profit, and had
combined with the directors in their pernicious practices to the ruin
of the public trade and credit of the kingdom: that he should for
his offences be ignominiously expelled from the House of Commons, and
committed a close prisoner to the Tower of London; that he should be
restrained from going out of the kingdom for a whole year, or till the
end of the next session of Parliament; and that he should make out a
correct account of all his estate, in order that it might be applied to
the relief of those who had suffered by his malpractices.

This verdict caused the greatest joy. Though it was delivered at
half-past twelve at night, it soon spread over the city. Several persons
illuminated their houses in token of their joy. On the following day,
when Mr. Aislabie was conveyed to the Tower, the mob assembled on
Tower-hill with the intention of hooting and pelting him. Not succeeding
in this, they kindled a large bonfire, and danced around it in the
exuberance of their delight. Several bonfires were made in other places;
London presented the appearance of a holiday, and people congratulated
one another as if they had just escaped from some great calamity. The
rage upon the acquittal of Mr. Stanhope had grown to such a height that
none could tell where it would have ended, had Mr. Aislabie met with the
like indulgence.

To increase the public satisfaction, Sir George Caswall, of the firm of
Turner, Caswall, & Co. was expelled the House on the following day, and
ordered to refund the sum of 250,000 pounds.

That part of the report of the Committee of Secrecy which related to the
Earl of Sunderland was next taken into consideration. Every effort was
made to clear his Lordship from the imputation. As the case against him
rested chiefly on the evidence extorted from Sir John Blunt, great
pains were taken to make it appear that Sir John's word was not to be
believed, especially in a matter affecting the honour of a peer and
privy councillor. All the friends of the ministry rallied around the
Earl, it being generally reported that a verdict of guilty against him
would bring a Tory ministry into power. He was eventually acquitted,
by a majority of 233 against 172; but the country was convinced of his
guilt. The greatest indignation was everywhere expressed, and menacing
mobs again assembled in London. Happily no disturbances took place.

This was the day on which Mr. Craggs, the elder, expired. The morrow had
been appointed for the consideration of his case. It was very generally
believed that he had poisoned himself. It appeared, however, that grief
for the loss of his son, one of the Secretaries of the Treasury, who had
died five weeks previously of the small-pox, preyed much on his mind.
For this son, dearly beloved, he had been amassing vast heaps of riches:
he had been getting money, but not honestly; and he for whose sake he
had bartered his honour and sullied his fame, was now no more. The
dread of further exposure increased his trouble of mind, and ultimately
brought on an apoplectic fit, in which he expired. He left a fortune of
a million and a half, which was afterwards confiscated for the
benefit of the sufferers by the unhappy delusion he had been so mainly
instrumental in raising.

One by one the case of every director of the Company was taken into
consideration. A sum amounting to two millions and fourteen thousand
pounds was confiscated from their estates towards repairing the mischief
they had done, each man being allowed a certain residue, in proportion
to his conduct and circumstances, with which he might begin the world
anew. Sir John Blunt was only allowed 5,000 pounds out of his fortune
of upwards of 183,000 pounds; Sir John Fellows was allowed 10,000
pounds out of 243,000 pounds; Sir Theodore Janssen, 50,000 pounds out of
243,000 pounds; Mr. Edward Gibbon, 10,000 pounds out of 106,000 pounds.;
Sir John Lambert, 5000 pounds out of 72,000 pounds. Others, less deeply
involved, were treated with greater liberality. Gibbon, the historian,
whose grandfather was the Mr. Edward Gibbon so severely mulcted, has
given, in the Memoirs of his Life and Writings, an interesting account
of the proceedings in Parliament at this time. He owns that he is not an
unprejudiced witness; but, as all the writers from which it is possible
to extract any notice of the proceedings of these disastrous years,
were prejudiced on the other side, the statements of the great historian
become of additional value. If only on the principle of audi alteram
partem, his opinion is entitled to consideration. "In the year 1716," he
says, "my grandfather was elected one of the directors of the South Sea
Company, and his books exhibited the proof that before his acceptance
of that fatal office, he had acquired an independent fortune of 60,000
pounds. But his fortune was overwhelmed in the shipwreck of the year
twenty, and the labours of thirty years were blasted in a single day. Of
the use or abuse of the South Sea scheme, of the guilt or innocence of
my grandfather and his brother directors, I am neither a competent nor
a disinterested judge. Yet the equity of modern times must condemn the
violent and arbitrary proceedings, which would have disgraced the cause
of justice, and rendered injustice still more odious. No sooner had
the nation awakened from its golden dream, than a popular, and even a
Parliamentary clamour, demanded its victims; but it was acknowledged on
all sides, that the directors, however guilty, could not be touched by
any known laws of the land. The intemperate notions of Lord Molesworth
were not literally acted on; but a bill of pains and penalties was
introduced--a retro-active statute, to punish the offences which did not
exist at the time they were committed. The Legislature restrained the
persons of the directors, imposed an exorbitant security for their
appearance, and marked their character with a previous note of ignominy.
They were compelled to deliver, upon oath, the strict value of their
estates, and were disabled from making any transfer or alienation of any
part of their property. Against a bill of pains and penalties, it is
the common right of every subject to be heard by his counsel at the bar.
They prayed to be heard. Their prayer was refused, and their oppressors,
who required no evidence, would listen to no defence. It had been at
first proposed, that one eighth of their respective estates should be
allowed for the future support of the directors; but it was speciously
urged, that in the various shades of opulence and guilt, such a
proportion would be too light for many, and for some might possibly
be too heavy. The character and conduct of each man were separately
weighed; but, instead of the calm solemnity of a judicial inquiry, the
fortune and honour of thirty-three Englishmen were made the topics of
hasty conversation, the sport of a lawless majority; and the basest
member of the committee, by a malicious word, or a silent vote, might
indulge his general spleen or personal animosity. Injury was aggravated
by insult, and insult was embittered by pleasantry. Allowances of 20
pounds or 1 shilling were facetiously moved. A vague report that a
director had formerly been concerned in another project, by which some
unknown persons had lost their money, was admitted as a proof of his
actual guilt. One man was ruined because he had dropped a foolish
speech, that his horses should feed upon gold; another, because he was
grown so proud, that one day, at the Treasury, he had refused a civil
answer to persons much above him. All were condemned, absent and
unheard, in arbitrary fines and forfeitures, which swept away the
greatest part of their substance. Such bold oppression can scarcely
be shielded by the omnipotence of Parliament. My grandfather could not
expect to be treated with more lenity than his companions. His Tory
principles and connexions rendered him obnoxious to the ruling powers.
His name was reported in a suspicious secret. His well-known abilities
could not plead the excuse of ignorance or error. In the first
proceedings against the South Sea directors, Mr. Gibbon was one of the
first taken into custody, and in the final sentence the measure of
his fine proclaimed him eminently guilty. The total estimate, which he
delivered on oath to the House of Commons, amounted to 106,543 pounds
5 shillings 6 pence, exclusive of antecedent settlements. Two different
allowances of 15,000 pounds and of 10,000 pounds were moved for Mr.
Gibbon; but, on the question being put, it was carried without a
division for the smaller sum. On these ruins, with the skill and credit
of which Parliament had not been able to despoil him, my grandfather,
at a mature age, erected the edifice of a new fortune. The labours of
sixteen years were amply rewarded; and I have reason to believe that the
second structure was not much inferior to the first."

The next consideration of the Legislature, after the punishment of the
directors, was to restore public credit. The scheme of Walpole had been
found insufficient, and had fallen into disrepute. A computation was
made of the whole capital stock of the South Sea Company at the end of
the year 1720. It was found to amount to thirty-seven millions eight
hundred thousand pounds, of which the stock allotted to all the
proprietors only amounted to twenty-four millions five hundred thousand
pounds. The remainder of thirteen millions three hundred thousand pounds
belonged to the Company in their corporate capacity, and was the profit
they had made by the national delusion. Upwards of eight millions of
this were taken from the Company, and divided among the proprietors and
subscribers generally, making a dividend of about 33 pounds 6 shillings
8 pence per cent. This was a great relief. It was further ordered, that
such persons as had borrowed money from the South Sea Company upon stock
actually transferred and pledged at the time of borrowing to or for the
use of the Company, should be free from all demands, upon payment of ten
per cent. of the sums so borrowed. They had lent about eleven millions
in this manner, at a time when prices were unnaturally raised; and they
now received back one million one hundred thousand, when prices had sunk
to their ordinary level.

But it was a long time before public credit was thoroughly restored.
Enterprise, like Icarus, had soared too high, and melted the wax of
her wings; like Icarus, she had fallen into a sea, and learned, while
floundering in its waves, that her proper element was the solid ground.
She has never since attempted so high a flight.

In times of great commercial prosperity there has been a tendency to
over-speculation on several occasions since then. The success of
one project generally produces others of a similar kind. Popular
imitativeness will always, in a trading nation, seize hold of such
successes, and drag a community too anxious for profits into an abyss
from which extrication is difficult. Bubble companies, of a kind similar
to those engendered by the South Sea project, lived their little day
in the famous year of the panic, 1825. On that occasion, as in 1720,
knavery gathered a rich harvest from cupidity, but both suffered when
the day of reckoning came. The schemes of the year 1836 threatened, at
one time, results as disastrous; but they were happily averted before
it was too late. The South Sea project thus remains, and, it is to be
hoped, always will remain, the greatest example in British history, of
the infatuation of the people for commercial gambling. From the bitter
experience of that period, posterity may learn how dangerous it is to
let speculation riot unrestrained, and to hope for enormous profits from
inadequate causes. Degrading as were the circumstances, there is wisdom
to be gained from the lesson which they teach.




THE TULIPOMANIA.

     Quis furor o cives!--Lucan.

The tulip,--so named, it is said, from a Turkish word, signifying a
turban,--was introduced into western Europe about the middle of the
sixteenth century. Conrad Gesner, who claims the merit of having brought
it into repute,--little dreaming of the extraordinary commotion it was
to make in the world,--says that he first saw it in the year 1559, in a
garden at Augsburg, belonging to the learned Counsellor Herwart, a man
very famous in his day for his collection of rare exotics. The bulbs
were sent to this gentleman by a friend at Constantinople, where the
flower had long been a favourite. In the course of ten or eleven
years after this period, tulips were much sought after by the wealthy,
especially in Holland and Germany. Rich people at Amsterdam sent for the
bulbs direct to Constantinople, and paid the most extravagant prices
for them. The first roots planted in England were brought from Vienna
in 1600. Until the year 1634 the tulip annually increased in reputation,
until it was deemed a proof of bad taste in any man of fortune to be
without a collection of them. Many learned men, including Pompeius de
Angelis and the celebrated Lipsius of Leyden, the author of the
treatise "De Constantia," were passionately fond of tulips. The rage for
possessing them soon caught the middle classes of society, and merchants
and shopkeepers, even of moderate means, began to vie with each other
in the rarity of these flowers and the preposterous prices they paid for
them. A trader at Harlaem was known to pay one-half of his fortune for a
single root--not with the design of selling it again at a profit, but to
keep in his own conservatory for the admiration of his acquaintance.

One would suppose that there must have been some great virtue in this
flower to have made it so valuable in the eyes of so prudent a people
as the Dutch; but it has neither the beauty nor the perfume of the
rose--hardly the beauty of the "sweet, sweet-pea;" neither is it as
enduring as either. Cowley, it is true, is loud in its praise. He says--

     "The tulip next appeared, all over gay,
     But wanton, full of pride, and full of play;
     The world can't show a dye but here has place;
     Nay, by new mixtures, she can change her face;
     Purple and gold are both beneath her care--
     The richest needlework she loves to wear;
     Her only study is to please the eye,
     And to outshine the rest in finery."

This, though not very poetical, is the description of a poet. Beckmann,
in his History of Inventions, paints it with more fidelity, and in prose
more pleasing than Cowley's poetry. He says, "There are few plants which
acquire, through accident, weakness, or disease, so many variegations as
the tulip. When uncultivated, and in its natural state, it is almost of
one colour, has large leaves, and an extraordinarily long stem. When it
has been weakened by cultivation, it becomes more agreeable in the eyes
of the florist. The petals are then paler, smaller, and more diversified
in hue; and the leaves acquire a softer green colour. Thus this
masterpiece of culture, the more beautiful it turns, grows so much the
weaker, so that, with the greatest skill and most careful attention, it
can scarcely be transplanted, or even kept alive."

Many persons grow insensibly attached to that which gives them a great
deal of trouble, as a mother often loves her sick and ever-ailing child
better than her more healthy offspring. Upon the same principle we must
account for the unmerited encomia lavished upon these fragile blossoms.
In 1634, the rage among the Dutch to possess them was so great that the
ordinary industry of the country was neglected, and the population,
even to its lowest dregs, embarked in the tulip trade. As the mania
increased, prices augmented, until, in the year 1635, many persons were
known to invest a fortune of 100,000 florins in the purchase of forty
roots. It then became necessary to sell them by their weight in perits,
a small weight less than a grain. A tulip of the species called Admiral
Liefken, weighing 400 perits, was worth 4400 florins; an Admiral Von
der Eyk, weighing 446 perits, was worth 1260 florins; a shilder of 106
perits was worth 1615 florins; a viceroy of 400 perits, 3000 florins,
and, most precious of all, a Semper Augustus, weighing 200 perits, was
thought to be very cheap at 5500 florins. The latter was much sought
after, and even an inferior bulb might command a price of 2000 florins.
It is related that, at one time, early in 1636, there were only two
roots of this description to be had in all Holland, and those not of the
best. One was in the possession of a dealer in Amsterdam, and the other
in Harlaem. So anxious were the speculators to obtain them that one
person offered the fee-simple of twelve acres of building ground for
the Harlaem tulip. That of Amsterdam was bought for 4600 florins, a new
carriage, two grey horses, and a complete suit of harness. Munting, an
industrious author o

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