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 a hundred and sixty 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 meantime 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
t