He was too sound and
sober a banker to admit small notes. They were excluded from his
system. He found France on the eve of bankruptcy; in fact, the state
had committed acts of virtual bankruptcy. He saved her with his bank.
"Then came his two errors, one remedial, the other fatal. No. 1, he
created a paper company and blew it up to a bubble. When the shares
had reached the skies, they began to come down, like stones, by an
inevitable law. No. 2, to save them from their coming fate, he propped
them with his bank. Overrating the power of governments, and
underrating Nature's, he married the Mississippi shares (at forty
times their value) to his banknotes by edict. What was the
consequence? The bank paper, sound in itself, became rotten by
marriage. Nothing could save the share-paper. The bank paper, making
common cause with it, shared its fate. Had John Law let his two tubs
each stand on its own bottom, the shares would have gone back to what
they came from--nothing; the bank, based as it was on specie, backed
stoutly by the government, and respected by the people for great
national services, would have weathered the storm and lasted to this
day. But he tied his rickety child to his healthy child, and flung
them into a stormy sea, and told them to swim together: they sank
together. Now observe, sir, the fatal error that ruined the great
financier in 1720 is this day proposed to us. We are to connect our
bank with bubble companies by the double tie of loans and liability.
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