What was the name of France’s 1720 financial bubble centered on John Law’s Mississippi Company?

France’s 1720 financial bubble centered on John Law’s Mississippi Company was the Mississippi Bubble.

John Law, a Scottish financier, helped create a system in France based on a major bank and paper money. His Mississippi Company held a monopoly over French colonial trade, especially territories associated with the Mississippi River. Investors came to believe that the company’s American holdings would produce extraordinary wealth.

Shares rose rapidly as money flowed into the scheme. The boom depended heavily on confidence, expanding credit, and exaggerated expectations rather than proven commercial returns. When confidence weakened, investors rushed to exchange paper claims for more reliable assets, and the share price collapsed.

The Mississippi Bubble is frequently confused with the South Sea Bubble, which occurred in Britain during the same year. The two episodes were distinct, but both became classic examples of eighteenth-century speculative finance.