The Gambler Who Owned France

What actually happened

Law's System merged a note-issuing bank with the Mississippi Company until shares, currency and state debt were one self-referential machine: print notes to buy shares, watch shares rise, print more. 'Millionaire' entered the language on the Rue Quincampoix. As Controller-General, Law effectively ran the French economy.

When holders tried to convert paper back into coin, the System needed exits it didn't have. Law capped, devalued, forbade gold hoarding, and each decree burned trust faster. By December 1720 he fled France with almost nothing; the state carried the wreckage and a lasting French suspicion of paper money and central banks.

Ferguson's verdict, which the episode adopts: not a simple swindler, but a monetary theorist a century early, with a gambler's tolerance for the downside of being wrong.

The longer arc

Law arrived in France already a fugitive: a 1694 duel in London had left his opponent dead, a death sentence commuted from hanging to a fine that Law escaped by breaking out of prison and fleeing to the Continent. He spent the next two decades pitching a national bank backed by land or paper credit to any government that would listen, including his native Scotland, which rejected the idea before France, desperate after Louis XIV's debts, finally accepted it in 1716.

When his System collapsed in 1720, Law fled France with almost nothing, spent years drifting through Europe including a stint under surveillance in England, and settled at the end of his life in Venice, where he died in 1729, poor and largely forgotten, of pneumonia. He was buried in the church of San Moisè, where his grave remains. France's finances took decades to recover from the wreckage, and the episode left a durable national suspicion of paper currency that resurfaced when the Revolutionary government's own paper money, the assignat, also collapsed into hyperinflation seventy years later.