Law, John

John (1671-1729), a celebrated Scottish financier and promoter of commercial schemes. He was born at Edinburgh and died at Venice. His father was a goldsmith. While Law cannot be termed a penniless adventurer he went to London when a young man to seek his fortune. He appears to have led a gambling, dissolute life, becoming involved in a social intrigue. In 1694 he killed Beau Wilson in a duel and was condemned to death. He made his escape to Holland, then the commercial center of Europe. A few years later he returned to Scotland. He proposed that the Scottish Parliament tide over a period of commercial depression by the issuance of paper money. His plan not meeting with approval he betook himself again to a roving, gambling life. He visited Rome, Genoa, Vienna, Brussels, and Paris. He won large sums of money by gambling and spent his winnings recklessly.

In Paris Law made the acquaintance of the Duke of Orleans. When in 1715 the king died and the duke became regent, Law was in high favor. Although he had previously been expelled from Paris as a suspicious character he was now permitted to put his schemes into operation to his heart's content. He organized trading companies, founded a royal bank, took over the debts of France, was intrusted with the collection of taxes, and carried matters with a high hand. He had a practical monopoly of exchange. Business men in outlying towns were obliged to make and receive remittances through his bank. Among measures tending to make him popular was a reduction of the interest on the national debt. His company was authorized to issue shares of stock. They rose rapidly in value. Semi-annual dividends of six per cent were promised. The carriages of the great filled the street in front of Law's banking house, and the nobility elbowed each other in their haste to get a word in private with John Law and to invest their fortunes in the shares of his bank. He created the greatest financial bubble known.

Law kept up his dividends for a time by the sale of stock. When the total issue of stock reached a point where an annual dividend of less than one per cent could be paid, people lost confidence and the bubble burst. Thousands who had borrowed money to buy shares or who had invested their all under his advice, were ruined. Distress and financial bankruptcy resulted throughout France. Law fled the country and resumed a wandering life. He settled down finally at Venice in poverty and was forgotten. Those who visited him in his later days stated that he never lost confidence, however, in his financial schemes. A vivid picture is drawn in Emerson Hough's recent novel, John Law and the Mississippi Bubble.