John Law was a man ahead of his time. In the early 18th century, he persuaded the Kingdom of France to adopt a system of paper money, and effectively construct a parallel fiat currency. It was an emotional experience for everyone, particularly those Frenchmen and women clapped in irons and shipped overseas to Louisiana.
It would be another two and a half centuries (and a couple of world wars) before the rest of the World would switch to fiat currencies, which is to say that the money of those nations would be backed not by an asset, like a pile of gold bars in a locked vault, but instead backed by... well, nothing much at all really, other than the presumption that a nation would continue to exist, to pay its bond coupons, and to hopefully not hyper-inflate the currency away to vapour. Surprisingly this system seems to be working for much of the world. Let's find out whether it worked for John Law.
Patronise the Cat: