It was concocted between himself and the regent, that the creditors of the state should be paid off in notes of the Royal Bank; and that a tempting scheme of investment should be opened to the public, so as to absorb all the excessive portion of these monstrous emissions of paper, and prevent a demand upon the bank of specie in exchange for its own notes. In other words, as Storch has well expressed it, the regent bought the shares of this new company with the notes of his own bank; he then borrowed these notes of the company, in order to pay off the national creditors; and finally sold the shares as a means of repaying for the loan of the notes.

This precious scheme was fairly set on foot in May, 1719, by the consolidation of various trading associations, under the management of Law, and the issue of a new patent to him as chief of the Compagnie des Indes, (the Indian Company.) This concern immediately issued 50,000 shares of 500 livres each, payable in specie, but sold to the public at a premium of 10 per cent., or at 550 livres, and realising of course a sum of 27,500,000 livres. These 50,000 shares were sought after with the greatest alacrity, and presently rose to a price very greatly beyond their first cost. The company then created 50,000 more shares of 500 livres each, and took care to profit by the rising market, for this time they fixed the price at 1,000 livres, or at 100 per cent. premium.

The mania was now advancing rapidly to its climax. As a pretext for the creation of more shares, the company undertook the most extravagant enterprises. They purchased from government the farm of the tobacco revenue. They then undertook the coinage of money, and finally they became the sole Farmers General of the kingdom, upon the condition of lending to the state 1,600 millions of livres, at 3 per cent. per annum. It was then announced that the company would forthwith pay a dividend of 200 livres upon each of these 500 livres shares-in other words, they declaired a devidend of 40 per cent. per annum.

The shares then mounted rapidly to 5,000 livres each, and that was the moment when the fury of the delusion attained its highest pitch. All France was possessed with the demon of l'agiotago. Crowds of people from the remotest provinces rushed to Paris, to devote themselves to this new pursuit, and probably the excitement, the chicanery, the charlatanism, the delusion, the extravagance, and the debauchery, of which that capital was the focos during the autumn of 1719, have never been equalled in any other place, nor at any other conjuncture.

By two further creations, making four creations in all, the number of shares was increased to 624,000; and then it was judged that the proper ⚫moment had arrived for the payment of the national debts by notes of the Banque Royale. The issue nearly in a mass of so prodigious a volume of paper money, conspiring with the insanity of the public mind, drove up the price of the shares representing merely a capital of 500 livres in an untried company, to the astounding price of 10,000 livres each.

Under such circumstances the position of the public creditors thus paid off was unfortunate in the highest degree. A capital of 10,000 livres at 4 per cent. was equal to an annual dividend of 400 livres. This 10,000 livres, they suddenly found themselves in a manner compelled to transfer from the form of a state debt, worth 400 livres a year, into the form of a

trading adventure, intrinsically worth only 500 livres, and upon the most extravagant computation, yielding only 200 livres per annum-or just one-half of their former income.

The reaction now set in. The point had been fully gained beyond which the demand for shares could not be extended. The market had exhausted every impetus which could be given to it by the influx of new classes of purchasers, and henceforward the price of these imaginary riches began to decline rapidly, and, as a natural result, excited a corresponding run upon the Bank for coin in exchange for notes.

The entire system was in imminent peril of exposure, and Law had again recourse to his unscrupulous expedients. The government, by a series of decrees, affected to entertain the most profound contempt for metallic money, and exhorted all good Frenchmen to avoid it as a needless and costly contrivance. These exhortations not succeeding, they adopted a more stringent policy. All payments in silver above 10 livres, and in gold above 300, were prohibited; and by a volley of most arbitrary and capricious edicts, the whole system of the coinage was purposely involved in the most perplexing confusion. The livre, for example, was altered first to a 28th, then to a 40th, then to a 60th, then an 80th then a 120th, then a 70th, and finally to a 65th part of a mark of fine silver. By these flar gitious means the government hoped to drive the people into the use of their paper money. The success, however, was partial; and at last the decree of the 27th February and 11th March, 1720, prohibited the use of metallic money absolutely and in all cases.

Between the 1st January, 1719, and the 1st May, 1720, the Bank had issued notes to the extent of 2,235 millions of livres. Of this enormous sum no less than 1,925 millions were issued in the last four months of 1719. The consequences were of course inevitable; coin had totally disappeared from the country, and the prices of all other articles of subsistence, luxury, and possession increased day by day with a frightful rapidity. Law now discovered that at last there was too much of what he called credit. But as he had no means of lessening the quantity of paper by the redemption of any part of it, he again resorted to the Regent, and on the 21st May, 1720, appeared the famous arret, diminishing the nominal value of the paper by one-half. This was the fatal consummation. The world were then entirely undeceived as to the terrible drama which for a twelvemonth had filled all Europe with amazement, and converted almost a majority of the French nation into a fraternity of gamblers.

This protentous arret was recalled six days afterwards, but it was too late. The alarm had become general, and beggary and despair had already taken possession of the crowds hitherto the victims of a frantic intoxication. Government offered to redeem the notes by the creation of rentes, and frightful was the depreciation, that the conversion of the paper money under this offer took place at between 50 and 100 per cent. under the nominal amount. When all was settled, it was found that by these nefarious and scandalous confiscations the capital of the national debt had been reduced by 844 millions of livres, and its annual interest by 44 millions.

This was the extent of the direct loss to the creditors of the state. What was the amount and the diffusion of the indirect and positive for

feitures of property, position, happiness, and honour, over the rest of the community, it is utterly impossible to describe.

Specie there was none. It was buried or exported. Confidence there was none. Industry, as a habit and as an art, was despised and almost forgotten. The national treasury was drained of its final farthing; and as far, probably, as a civilized state can ever descend in one year towards a condition of helpless infancy, France had undergone such a declension. This then is an outline of this gigantic delusion of paper money. We have been the more elaborate in our detail of its progress, because its real history is so little know, the authentic sources of that history are not very accessible, and because, at this moment, it is every way dseirable that mankind should not forget lessons that have been bought so dearly.

HOUSE OF ROTHSCHILD.

From Chambers' Journal.

It is usual to trace the origin of great families to some gallant exploit, or some lucky accident, which suddenly raised the ancestor of the house from obscurity, and provided him at the same time with a legend to his coat of arms. The representatives of such families are born personages of history; their name, title, and estate-their position in the countrydescending to them by inheritance, and so continuing from generation, to generation till war or revolution damages or removes the old landmarks of society. But there are other origins which it would be vain to endeavor to arrive at by a similar process; the origins of houses that rise steadily, not suddenly, in their peculiar career, and the success of which is not secured by a single incident, but distributed evenly over the lifetime of one or more generations. In such cases, the germ of prosperity must be sought for in the family mind-in the idiosyncrasy of the race in the theory by which their conduct in the world is governed; and the first accident, which attracts the attention of the vulgar as the origin of their fortune, is merely a point d'appui selected by forethought and resolution. The rise of the house of Rothschild presents a very remarkable illustration of this view of a question which will never cease to be interesting, and affords a striking instance of the natural and simple means by which those vast results are obtained which it is customary to ascribe to chance or miracle.

In the middle of the last century there lived, in the town of Frankforton-the-Maine, a husband and wife of the Hebrew persuasion, who lavished all their cares upon a son, whom they destined for the profession of a schoolmaster. The boy, whose name was Meyer Anselm Rothschild, and who was born at Frankfort in the year 1743, exhibited such tokens of capacity, that his parents made every effort in their power to give him the advantage of a good education; and with this view he spent some years at Fürth, going through such a curriculum of study as appeared to be proper. The youth, however, had a natural bent towards the study of antiquities; and this led him more especially to the examination of

ancient coins, in the knowledge of which he attained considerable proficiency. Here was one step onwards in the world; for, in after years, his antiquarian researches proved the means of extending and ramifying his connections in society, as well as of opening out to him a source of immediate support. His parents, however, who were noted as pious and upright characters, died when he was yet a boy, in his eleventh year; and on his return to Frankfort, he set himself to learn practically the routine of the counting-house.

After this we find him in Hanover, in the employment of a wealthy banking-house, whose affairs he conducted for several years with care and fidelity; and then we see opening out under his auspices, in his native city, the germ of that mighty business which was destined to act so powerfully upon the governments of Europe. Before establishing his little banking-house, Meyer Anselm Rothschild prepared himself for the adventure by marrying; and his prudent choice, there is no doubt, contributed greatly to his eventual success in the world.

About this time a circumstance is said to have occurred, to which the rise of the Rothschilds from obscurity is ascribed, by those who find it necessary to trace such brilliant effects to romantic and wonderful causes. The Prince of Hesse-Cassel, it seems, in flying from the approach of the republican armies, desired, as he passed through Frankfort, to get rid of a large amount in gold and jewels, in such a way as might leave him a chance of its recovery after the storm had passed by. With this view he sought out the humble money-changer, who consented reluctantly to take charge of the treasure, burying it in a corner of his garden just at the moment when the republican troops entered the gates of the city. His own property he did not conceal, for this would have occasioned a search; and cheerfully sacrificing the less for the preservation of the greater, he re-opened his office as soon as the town was quiet again, and recommenced his daily routine of calm and steady industry. But he knew too well the value of money to allow the gold to lie idle in his garden. He dug it forth from time to time as he could use it to advantage; and, in fine, made such handsome profits upon his capital, that on the duke's return in 1802, he offered to refund the whole, with five per cent. interest. This of course was not accepted. The money was left to fructify for twenty years longer, at the almost nominal interest of two per cent.; and the duke's influence was used, besides, with the allied sovereigns in 1814 to obtain business for "the honest Jew" in the way of raising public loans.

The "honest Jew," unfortunately, died two years before this date, in 1812; but the whole story would appear to be either entirely a romance, or greatly exaggerated. Rothschild must have already been eminent as a banker, or he would hardly have been selected by the Prince of HesseCassel as the depository of a sum amounting, it is said, to £50,000, exclusively of the jewels. At any rate, it was in the year 1801 he was appointed agent to the land-grave, afterwards Elector of Hesse; and in next year (indicated in the story as that of the prince's return) a loan of ten millions was contracted with the Danish court through the house of Rothschild. Before this-and necessarily so no doubt-his knowledge, and the tried rectitude of his conduct, had gained him general confidence;

his wealth had increased, and an enormous extension of the field of his operations had taken place. The fact appears to be, that by this time the banker of Frankfort was more in the habit of rendering assistance than of requiring it; and the grand duke of the day, to whom the Israelites owed their civic and political rights, nominated him a member of the electoral college, expressly as a reward for his generous services to his fellew-citizens.

The personal character of Meyer Anselm Rothschild is not of small consequence in the history of the house-for their dead father may be said to direct to this hour the operations of his children! In every important crisis he is called into their counsels; in every difficult question his judgment is invoked; and when the brothers meet in consultation, the paternal spirit seems to act as president. The explanation of this well-known and most remarkable trait in the family is not difficult to those who are in the habit of penetrating through the veil of the romantic, in order to arrive at the simple realities of life. The elder Rothschild was obviously a man of comprehensive intellect, who did not act on the spur of chance or necessity, but after mature reflection, and on rules distinctly laid down; and he must have brought up his children in a certain theory, which survived his mortal part, and became identified with his memory. This is the only idolum conjured by the piety of his descendants. His bearing, we are told, was tranquil and unassuming; and although a devout man, according to his views of religion, his devotion was so completely untinged with bigotry, that in his charities he made no distinction between the Jew and the Christian.

In 1812, Rothschild left to the mighty fortunes, of which his wisdom had laid the foundation, ten children-five sons and five daughters; laying upon them, with his last breath, the injunction of an inviolable union. This is one of the grand principles to which the success of the family may be traced. The command was kept by the sons with religious fidelity. The copartnership in which they were left, remained uninterrupted; and from the moment of their father's death, every proposal of moment was submitted to their joint discussion, and carried out upon an agreed plan, each of the brothers sharing equally in the results. The other great principle of their conduct is one which actuates all prudent men, and is only deserving of special remark in them, from the almost mechanical regularity with which it was acted upon-this was the determination never to run the slightest risk in pursuit of great profits. Their grand object was to see clearly each transaction to its termination, to secure themselves from all accidents that human fore-thought could avert, and to be satisfied with a reasonable and ordinary reward. The plan acted in a twofold manner. By husbanding their capital, they were enabled to take advantage of a thousand recurring commissions, so as to extend their connection day by day; while their habitual caution earned for them a reputation of solidity, which, united with their real wealth, carried their credit to a pitch which would have been dangerous, if not fatal, to less steady intellects. Credit, however, was no snare to them. They affected no master-strokes-no coups d'etat. They would have used the lamp of Aladdin, not to summon genii, but to light their steps as they toiled on in the path of genii. The only secrets by which they obtained their