ipl-logo

Mississippi Bubble Essay

1084 Words5 Pages

The Mississippi Bubble In the early 18th century France had a very depressed economy. The government was severely in debt and the taxes were very high. At this time, France also controlled the colony of Louisiana, a settlement in North America. France was the first European country to settle this area of North America. This was a new world with many new opportunities and many new obstacles. The Mississippi Bubble was an economic bubble in France in the early 1700s that triggered a frenzy and ended in financial collapse. The scheme was engineered by John Law (1671-1729), a Scottish adventurer, gambler, economic theorist and financial wizard. Law was a colorful character who has been described as tall, handsome, and vain. He had a passion for …show more content…

These bank notes would be backed by the large sums of gold and silver that the bank held and would be used as a medium of exchange. Law thought it was the unpredictable supply of gold and silver that was slowing the economy rather than a true economic problem. Law proposed that by switching to paper, trade would speed up due to the increase in currency issued. He created a bank that took deposits in coin, but issued loans and withdrawals in paper. Law 's bank built up its reserves through a stock issue and also made a good profit by handling the government 's financial needs. The Encyclopedia Britannica said that “paper money was a new concept for the French; money to them was silver and gold. Law believed that paper notes would increase the money in circulation, which, in turn, would increase commerce.” These conditions would help rebuild and restimulate the finances of the French government. At this point in time Law’s idea was actually helpful to the French government, but he continued to look to the future to see what kind of money and powers he could gain. Law’s desire was a main cause of the governments

Show More
Related
129 Words | 1 Pages

Financial stability of the colonial people was often thought to be put at stake with the introduction of new taxes and regulations which caused much frustration. Before Parliament had laid out any questionable taxes (i.e. stamp act), the citizens appeared perfectly content with Parliament 's power (Doc C). The stamp act required that every document, used by the colonists be stamped and taxed. One can see why this would anger people (as paper was the “big thing” before modern technology). Chaos ensued, the colonists were not fond of tax collectors whatsoever.

Read More
493 Words | 2 Pages

The states, back then, had the choice to choose paper money, and most of them did because they didn’t really want to pay taxes with their gold and silver. With this change in currency, the value fell and hurt the economic “reputation”. If the federal government hadn’t given the state governments the right to choose paper money they would have been much better off in the long run. Overall, in his article The Devil in Devolution, Donahue’s main point was the states were being given too much power and weren’t necessarily able to handle all the responsibility properly that comes with power like the federal government would have been able

Read More
628 Words | 3 Pages

Duane, and Roger B. Taney, until he found a secretary willing to distribute the money from the National Bank to smaller banks, Levi Woodbury. With this, local state banks had all the responsibilities and power of banking; only they could give out loans and invest. But, after irresponsible investments, the banks quickly lost the funds and began the process of the U.S. falling into the Panic of 1837. On top of the bank’s misjudgments, the value of the paper currency was falling due to Jackson’s Specie Circular, an act that made only gold and silver an acceptable currency for land. Such economic instability undermined the people’s faith in the economy and eventually lead to the Panic of 1837, a major financial

Read More
935 Words | 4 Pages

The French and Indian war (1754-63) resulted in political, economic and ideological relations between British and its American colonies. Even during the time of war, population was booming. The land was becoming too small for the people, which meant the Americans needed more land. France was not going to let the colonists into their land, meaning there was only one way to go: west. The people that occupied such land were the people that were there since the beginning when the first colonists arrived.

Read More
582 Words | 3 Pages

Revolutions were a common occurrence in many parts of the world. The 17th century was miserable. Between 1790 and 1848 many different people in Europe, Central America, the Caribbean, and other areas of the world struggled to gain freedom and independence from oppressive and dictatorial regimes. While the the French and Haitian Revolutions, inspired by the American Revolution, were alike in many areas such as social class struggles, economic inequities, and personal freedoms. In spite of their similarities the revolutions in France and Haiti were  more different than similar because pitted While France struggled with it’s

Read More
279 Words | 2 Pages

Beginning in the 17th century, France discovered the Mississippi River valley and established scattered settlements in

Read More
569 Words | 3 Pages

The Mississippi Freedom Democratic Party was founded in 1963 to counter the Mississippi Democratic Party which only allowed participation by whites. The party was developed during the Freedom Summer Hamer and the Mississippi Freedom Democratic Party, of which Hamer was the vice-chair. In 1964, 40 percent of the population was black, yet they were not allowed to participate in the political system (Bramlett-Solomon 1991, 515). The party registered 60, 000 black voters in the state of Mississippi and after that effort party delegates were sent to the 1964 Democratic Convention.

Read More
1236 Words | 5 Pages

As a result due to bank power, the Commercial Law was established to help charter businesses and create limited liability for investor’s. Developers were legally allowed to buy land from the unwilling. It also didn’t allow employees who were hurt in the workplace to lay blame onto their employers. These things enabled investors who were close to banks to succeed and increase their wealthy. There were many people who believed that this would lead to a collapse in the economy for those with unequal privileges, and despite the large boom in the economy the first few years, there was the panic of 1819.

Read More
496 Words | 2 Pages

This established a modern, more unified banking system under a mixture of private and government control. The Federal Reserve System would allow members of banks to demand their reserves to draw in greater security, and made the currency and bank credit more adjustable. This made farmers furious because it was more difficult to get loans and then made the shipping and selling of crops more expensive. They wanted the seed to be lower so the could buy more and spend the same and have a silver based currency instead of the gold based. The Populists called for government ownership of railroads, arguing that they were too critical to be left in private hands.

Read More
512 Words | 3 Pages

Taxes, which is still a commonly disagreed topic, were a major reason the people of France revolted. The members of the first estate were paying only a fraction of what the members of the third and event the second were. Arthur Young, a man who travelled through France from 1787 to 1789, made the observation that land owned by nobility and people of the upper class was taxed very little compared to the land owned by common citizens (Doc. 1). This injustice took a great toll on members of the third estate and

Read More
123 Words | 1 Pages

The French and Indian War was a war from 1754 to 1763 between the Kingdom of Great Britain and France in North America. The war extended to the world as part of the Seven Years War. It officially came to a close with the Treaty of Paris in 1763 and North America territories were divided to United Kingdom. Spain ceded Florida to the United Kingdom. France ceded Louisiana to the east of Mississippi River to the United Kingdom as compensation.

Read More
720 Words | 3 Pages

However, Americans were able to succeed because of their quick increase in population and economy. One of France’s financial problems came from the money they loaned America during the war. Arthur Young traveled throughout France and saw that “lands held by the nobility are taxed very little [and] lands held by commoners are taxed heavily” (Doc B). This comes back to the idea of inequality and how the government supported a class system in France that negativly affects the third estate. Because commoners’ land was taxed so much, they were unable to feed themselves.

Read More
674 Words | 3 Pages

Before a single form of currency was established, local banks were allowed to make loans that were issued by their own bank notes. The local banks did not have to use gold and

Read More
1333 Words | 6 Pages

France, which grew in trade and wealth, became the new power. With

Read More
510 Words | 3 Pages

This caused the new banks’ failure by issuing the Specie Circular order in 1836. The government land required payment to be in gold. The National Banks of United States collapsed, this caused what we know as the Panic of 1837, that Andrew Jackson’s successor had to deal with. This was much unorganized, banks got removed, etc. The lack of national banks was one of the many speculations that contributed policies that caused the market to crash in the year of 1837.

Read More

More about Mississippi Bubble Essay

Related Topics

Open Document