John Law was the Scottish financier behind France’s Mississippi Bubble scheme.
Law became influential in France after proposing a system based on paper money and a bank that could support economic activity. His company, the Compagnie du Mississippi, received a monopoly over French trade in the Mississippi region and later absorbed other commercial and tax-collection operations.
Investors bought shares enthusiastically, helping prices rise far beyond realistic expectations about the company’s American prospects. The scheme was supported by expanding paper-money issuance, which connected the stock boom to a broader monetary experiment.
Confidence collapsed in 1720. Shareholders tried to convert paper wealth into coin and other assets, while doubts grew about the company’s profits and the monetary system. Law lost influence and left France. The Mississippi Bubble and Britain’s South Sea Bubble are frequently compared because both reached their crisis point in the same year.