Collier's New Encyclopedia (1921)/Mississippi Scheme
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|Mississippi, University of→|
|disclaimer.Edition of 1921;|
MISSISSIPPI SCHEME, a bubble scheme projected by John Law in Paris in 1717 for the colonization and development of the Mississippi valley, combined with a banking scheme and a scheme for the management of the National debt, the whole supported by the French government. Shares originally issued at 500 livres (say $100) were sold at 10, 20, 30, and even 40 times their value. The state took advantage of the popular frenzy to issue increased quantities of paper money, which was readily accepted and invested in shares of Law's company. This went on till the value of the paper money became depreciated in value and the shares fell in price. Law, the originator of the bankrupt company, fled from France in 1720; the State acknowledged itself debtor to the shareholders to the extent of $340,000,000 (See Law, John).