Which company’s initial public offering helped trigger the 1720 Mississippi Bubble in France?

The Mississippi Company’s share offering helped trigger the 1720 Mississippi Bubble in France.

The company was promoted by Scottish financier John Law, who also controlled France’s Banque Générale and later its successor, the Banque Royale. Investors were attracted by grand expectations about trade and natural wealth in the French-controlled Mississippi territory.

Share prices rose rapidly as Law’s financial system linked company shares, banknotes, and government debt. Speculation eventually outran the company’s realistic commercial prospects. When confidence weakened, investors rushed to exchange paper claims for money and precious metals, causing the scheme to collapse.

The Mississippi Bubble occurred at roughly the same time as Britain’s South Sea Bubble. The two crises are often mentioned together, but the Mississippi episode centered on Law’s financial system in France, while the South Sea Company operated within Britain’s public-debt arrangements. Both became classic examples of speculative bubbles.