lue of the
shares and notes as an urgent necessity. Law, who saw in this reduction
an avowal of the fiction in the legal values, and a blow which must
hasten the fall of the "System," opposed it with his whole strength.
Nevertheless, M. d'Argenson prevailed. On May 21, 1720, a decree, which
remains famous in the history of the "System," advertised the
progressive reduction in the value of shares and notes. This reduction
was to begin on the very day of the publication of the decree, and to
continue from month to month until December 1st. At this last term the
shares were to be estimated at five thousand francs, and a bank-note of
ten thousand francs at five thousand; one of a thousand at five hundred,
etc. The notes were thus reduced 50 per cent., and the shares only
four-ninths per cent. Law, although opposed to the decree, consented to
promulgate it.

Scarcely was it published when a fearful clamor was raised on all sides.
The reduction was called a bankruptcy; the government was reproached
with being the first to throw discredit upon the values which it had
created, with having robbed its own creditors, a number of whom had just
been paid in bank-notes, even as late as the preceding day--in a word,
with assailing the fortunes of all the citizens. The crowd wished to
sack Law's hotel and to tear him in pieces. Nothing that could have
happened would have produced a greater clamor; but in times like those
it was not only necessary not to fear these clamors: it was even a duty
to defy them.

The reply to the complaints would have soon been evident to the
intelligence of everybody. Without doubt the creditors of the state, and
some private individuals, who had been paid in bank-notes, were half
ruined by the reduction, but this was not the fault of the decree of May
21st--the real reduction was long before this; the decree only stated a
loss already experienced, and the notes were worth still less than the
decree declared. Because a number of creditors had been ruined by the
falsity of nominal values, was it a reason to continue the fiction that
it might extend the ruin? On the contrary, it was necessary to put an
end to it, to save others from becoming victims. The official
declaration of the fact, although it was known before, must produce a
shock and hasten the discredit, but it was of little importance that it
was hastened, since it was inevitable.

The public thought Law the author of this measure, advised exclusi