French royal banknote, 100 livres Tournois
French royal banknote
Issued January 1, 1719
John Law’s “System” hinged on the novel idea—now commonplace today—that the production and circulation of paper money (as opposed to gold and silver coins) would lead to dramatic economic growth. In January 1719, the new Royal Bank of France placed its trust in that principle: it began printing paper banknotes that were signed by its officers, impressed with its seal, and emblazoned with large letters spelling out BANQUE ROYALE on the left-hand side. This surviving example promises to pay the bearer “on sight” the equivalent in silver coin—a promise they failed to live up to, however, when the bubble burst and a run on the bank ensued. One contemporary described the chaos, in which several investors were trampled to death, as a “terrifying slaughter.”
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