love of such a character and the comprehension of such an intelligence. Still the lovers and scholars will be few: still the rewards of fame will be scanty and ill-proportioned: no accumulation of knowledge or series of experiences can teach the meaning of genius to those who look for it in additions and results, any more than the numbers studded round a planet's orbit could approach nearer infinity than a single unit. The world of thought must remain apart from the world of action; for, if they once coincided, the problem of Life would be solved, and the hope, which we call heaven, would be realised on earth. And therefore men "Are cradled into poetry by wrong: They learn in suffering what they teach in song." 235.-THE MISSISSIPPI SCHEME. TUCKER. [THE "South Sea Bubble," and the "Mississippi Scheme," are amongst the most striking examples of public folly, when the whole community is bent upon believing that wealth is to be acquired without labour-when, in point of fact, the nation becomes one great gambling-house. The best account we have met with of the great bubble of France, more than a century ago, is given in a Treatise on 'Money and Banks,' by Mr. Tucker, Professor of History and Political Economy in the University of Virginia.] The first bank of circulation in France was established two-and-twenty years after the Bank of England, and, though it lived little more than four years, it became more memorable than any other, from its connection with the most extensive and ruinous scheme of speculation which history records. This bank, which has given celebrity to its founder, John Law, a Scotchman, was established in 1716, under the auspices of the Duke of Orleans, then Regent of France, for the express purpose, as some suppose, of wholly or partially paying off the public debt-then amounting to 2,000,000,000 of livres, and of which the government was unable to pay the interest. Law had, before he left Scotland, written a book on the subject of money and trade; and the principles he therein maintained no doubt influenced him in the execution of his great financial schemes, and thus contributed to the wide-spread ruin that attended their failure. With some just theory, expressed with shrewdness and force, he mixed up the following untenable positions:-That money owes its value to the public confidence; and that paper, or any thing else, may answer this purpose as well as the precious metals; (the first, as well as the last, he regarded as the mere signs of wealth:) that land was a better commodity for money than silver, and that the currency of a country might be increased to the whole value of its lands: that the effect of such an increase would be not depreciation. but merely a lowering of interest, by which trade would be encouraged and wealth augmented. The great number of persons, who, from that day to this, have sup ported similar fallacies, would seem to show that they are as plausible as they are dangerous. One The capital of Law's bank was 6,000,000 of livres, divided into twelve hundred shares of one thousand crowns each; and its notes soon obtained a general credit and currency. Two circumstances mainly contributed to their early success. was, that the government, according to an habitual abuse of the royal privilege, was then calling in the gold currency for a recoinage; and the louis d'or, which, .when restamped, the government meant to pass for twenty livres, it received at no more than sixteen. The bank gave a higher price for these coins than the government, and thus received many in exchange for its notes. The other favourable circumstance also grew out of an abuse of the royal prerogative. The marc of silver, a determinate quantity, had been sometimes made equivalent to a greater and sometimes to a less number of livres, at the pleasure of the crown; so that all contracts in livres (the general money of account) were exposed to the risk of these alterations in their value. Law therefore prudently made the notes of his bank payable in livres of the same weight and fineness as the current coin at the date of the note. These judicious measures, added to the intrinsic recommendations of paper currency when not used to excess, soon brought the notes of the bank into such general request, that, out of Paris, they commanded a premium of from one to one and a half per cent. In the following year (1717) the rights of a company, long before incorporated for the purposes of trading to Louisiana and Canada, and which were alleged to have been forfeited, were transferred to Law, to erect a new company; and then, if not before, the plan was formed of paying off the national debt by the joint aid of the company and the bank. Books were immediately opened for subscriptions to this Company of the West, or, Mississippi Company, to the amount of 100,000,000,000 of livres, in shares of 500 livres, payable in a part of the public debt, which was then passing at about thirty per cent. of its nominal amount. The shares were soon subscribed; and, as the government then punctually paid to the company the interest (four per cent.) on these 100,000,000,000, the company was able to make a correspondent dividend on its capital; that is, four per cent. on its nominal amount; by reason of which, the shares, which had cost in the market but 160 or 170 livres, now rose to par, or 500 livres; and the rise was imputed, by an indiscriminating public, to Law's financial skill, and the operation of his bank. About the close of the succeeding year, the regent, by way of giving greater credit to the bank, and of enlarging the sphere of its operations, paid off the original shareholders, and converted it into a royal bank. The notes it had then circulated amounted to 59,000,000—near twelve times its capital, but not quite a twentieth of the current coin of the kingdom, which was then estimated at 1,200,000,000. It would seem that the regent already anticipated inconvenience from the tenor of the notes first issued; and, in those issued by him, it was changed to a simple promise to pay the bearer the stated number of livres in silver coin. The reason assigned for this change (for governments rightly think that, with the mass of mankind, a bad reason is better than none) was, that the bank money, instead of being liable to perpetual fluctuations, as it had been, when compared with the livre, should be hereafter fixed. It is said by Stewart, Law's apologist, that he strenuously opposed this change. Although this alteration in the tenor of the note was calculated to excite distrust, it seems not to have had that effect; but the bank paper retained its credit, notwithstanding the large additions which the regent made to its amount. It is even asserted by contemporary writers, that their credit seemed unimpaired throughout the year 1719, though the issues of the bank then amounted to 1,000,000,000! The first project of the regent and Law is supposed to have been to pay off portions of the public debt with the coin which was constantly flowing into the bank, in consequence of the premium it bore over coin; and in this way the regent might obtain the use of the whole coin of the kingdom; and that the money thus paid to the public creditors would gradually return to the bank, in the payment of the public revenues—or, at least, enough of it to redeem such notes as should be returned to the bank. It was not foreseen by them, that no considerable addition could be made to the currency without depreciating it; and that such large issues of paper as their plan contemplated must necessarily drive gold and silver out of the country. Accordingly, it was found, soon after the regent took charge of the bank, that coin did not continue to flow into the bank as at first; and it therefore became necessary to change their plan, and to adopt one by which they might use the notes of the bank to discharge the public debt, without raising a suspicion of their credit. To effect this purpose, their plan was, for the regent to purchase shares of the Mississippi Company with the notes of the bank; then borrow of the company at a low interest, and with them, when thus endowed with a false credit, pay off the public creditors. By throwing the shares into the market, the regent might withdraw the notes from circulation. The result of these operations would be, that the public creditors would find themselves transformed into shareholders in the Mississippi Company; the government would have transferred a part of its revenues to the company, instead of owing all of them to its creditors, and be a gainer, first, by the lower interest paid to the company, and, secondly, by the advance the shares would naturally experience, when so large an addition had been made to the currency by paying off the national debt. In the execution of this vast scheme, which it seems as difficult to reconcile with uprightness of intention as soundness of judgment, the bank proceeded to make new notes, and the company to create new shares, to raise the value of which every expedient was resorted to. In May, 1719, Law's company was incorporated with the East India Company. In June, the mint was transferred to it for 50,000,000; and, to give it a supply of cash, fifty thousand shares were sold for 550 livres a share. A few ships were then purchased, to aid in deluding the credulous public with the hope of gain from traffic; and, in the succeeding month, 50,000 additional shares were sold at the advanced price of 1000 livres a share. The spirit of speculation being now called into existence, no time was lost in profiting by it. In August, the company farmed all the public revenues, and it agreed to lend to the government 1,600,000,000 at three per cent. On the faith of this arrangement, it publicly declared itself able to make an annual dividend of 200 livres a share. As interest was then four per cent., the shares, with such a dividend, would be worth 5000 livres ; and they immediately rose to that price. The bank continued to fabricate more notes, as the company had continued to create more shares, until, in October, 1719, the shares amounted to 624,000, and by the 1st of May following, the notes amounted to 2,696,400,000 livres ! The scheme that had been previously concerted being now ripe for execution, the regent became the purchaser of the new shares with the notes of his bank, and then borrowing back the same notes of the company, he with them paid off the public debt. The great object being thus effected, he, in February, 1720, re-united the bank with the company. The effect of these financial operations on the community was immense. The large fortunes which had been made by the first subscribers to the Mississippi Company, whose shares had, in the course of a single year (from September 1718 to 1719), risen from 170 livres to 5000, produced a mania for speculation and stock-jobbing that was without example, and which attracted men of capital and adventurers from all parts of Europe, to Paris, to share in its enormous profits. This real accession of wealth, added to the redundancy of the paper in circulation, raised the price of every species of property, and thus deluded the public with the belief of extraordinary national prosperity. Among other consequences of the depreciation of money, land sold at fifty years' purchase; and consequently, as so large a part of the national capital yielded but two per cent., that became the market rate of interest for large sums, and the shares of the company, which the credulous public estimated at 200 livres a year, accordingly now rose to 10,000 livres a share. But this state of things could not last. The depreciation of money, necessarily tending to expel gold and silver from the kingdom, soon began to be felt at the bank. To counteract the apprehended diminution of these metals, every device which Law's ingenuity could suggest, or the power of an arbitrary government could enforce, was resorted to for the purpose of retaining the coin in the bank, and of replenishing its coffers. Bills of exchange were required to be paid solely in bank notes. Public officers were to receive them in preference to coin. The value of the livre was greatly reduced in value, then raised, and lowered again to induce persons to deposit their specie (the value of which was thus suddenly and capriciously changed) in the bank, as a place of safety. These expedients proving insufficient, it was at length declared penal for any one to have more than 500 livres in his possession, or any articles of gold or silver, or to make any payment for more than 100 livres, except in bank notes; and domiciliary visits were enjoined on all public officers, for the purpose of enforcing these tyrannical edicts. If we had no other data for estimating the motives of the authors of the scheme, we may judge of the probity of their intentions by the means they adopted for their execution. These harsh measures brought some coin to the bank, but not enough to counterbalance the previous drain, and that which was still going on by the conversion of small notes into specie. Nor was this all the difficulty in the execution of the plan. After the shares rose to 5000 livres, and yet more, to 10,000 livres, many of the original holders were tempted to sell out, and the number thus thrown into the market at once, interfered with the såles of those belonging to the government, and tended to lower their prices. Money, too, would recover somewhat from its extreme depreciation, both by the export of coin, and by the withdrawal from circulation of those notes which were paid to the regent for shares; and as money rose in value, the market price of shares would fall. Had the project, then, been an honest one, these inherent and insuperable defects must have prevented its complete execution. Accordingly, in May, 1720, its authors, finding it impracticable either to sustain a paper currency, which then amounted to 2,235,000,000, or to withdraw it from circulation, reduced its value one half, by seven successive reductions, to take place between May and December. This royal edict broke the spell which had hitherto bound the people of France, and the day after its promulgation bank notes ceased to have circulation. The government, seeing the fatal consequences of its last decree, repealed it six days afterwards; but the credit of the notes had received its death-blow, and could not be revived. After several ineffectual attempts to restore it, their circulation was formally suppressed in October. On the winding up of this colossal scheme of stock-jobbing and fraud, it appeared that, of the 2,696,000,000 of notes struck off, 700,000,000 were found in the bank, and the rest were in circulation. The cash in the bank amounted to 90,000,000, which were used to pay off notes to the same amount; and the greater part of the residue were funded by the government, at an interest of from two and a half to two per cent., and a part remained a caput mortuum in the hands of its owners. The holders of the notes thus lost about one half of their nominal value by the bankruptcy. The loss sustained by the shareholders of the company was much greater. Of these shares, 200,000 were in the hands of the community, and the remaining 424 were found to be in the possession of the regent. The affairs of the company were in utter confusion after the explosion of the scheme; but when they were brought to a final adjustment with the government, in 1725, their whole capital—all that remained from the wreck of their splendid hopes-amounted only to 137,000,000; so that, if we estimate the 200,000 shares at the price they had actually borne a short time before, the loss of their holders amounted to 1,863,000,000! Besides the thousands and tens of thousands who were thus reduced from affluence to penury, 500,000,000 of coin are computed to have found their way to foreign countries; the government was pennyless; confidence between man and man was destroyed; in the unsettled value of money, no one knew in his dealings what to ask or what to give; and France, lately thought to be overflowing with wealth, now presented one general scene of poverty, distrust, and wretchedness. The gambling spirit which the Mississippi scheme had engendered in France extended soon after to England, and manifested itself in the South Sea scheme, and a thousand projects yet more visionary. 236.-THE MOON. WE select some of the passages of our poets which celebrate the beauties of our glorious satellite. And first, the famous description of the "refulgent lamp of night" which Pope has adapted from Homer: As when the moon, refulgent lamp of night, O'er heaven's clear azure spreads her sacred light, Eye the blue vault, and bless the useful light. This is a magnificent passage; but the noble simplicity of Homer is better rendered in Chapman's version:— As when about the silver moon, when air is free from wind, And stars shine clear; to whose sweet beams, high prospects, and the brows And even the lowly valleys joy to glitter in their sight, When the unmeasured firmament bursts to disclose her light, And all the signs in heaven are seen that glad the shepherd's heart The spirit of ancient song was never more beautifully seized upon than in Jonson's exquisite hymn to Cynthia: Queen and huntress, chaste and fair, Now the sun is laid to sleep, Heav'n to clear, when day did close: Bless us then with wished sight, Lay thy bow of pearl apart, Sidney's Sonnet is full of conceits, as the Sonnet poetry of his day was generally; but the opening lines are most harmonious : With how sad steps, O Moon, thou climb'st the skies! How silently, and with how wan a face! What! may it be, that e'en in heav'nly place That busy archer his sharp arrows tries? Sure, if that long-with-love-acquainted eyes |