Millionaire: The Philanderer, Gambler, and Duelist Who Invented Modern Finance

by Janet Gleeson Narrated by Esther Wane

Overview

On the death of France's most glorious king, Louis XIV, in 1715, few people benefited from the shift in power more than the intriguing financial genius from Edinburgh, John Law. Law had proposed to the English monarch that a bank be established to issue paper money with the credit based on the value of land. But Queen Anne was not about to take advice from a gambler and felon. So, in exile in Paris, he convinced the bankrupt court of Louis XV of the value of his idea.



Law soon engineered the revival of the French economy and found himself one of the most powerful men in Europe. The shareholders in his new trading company made such enormous profits that the term "millionaire" was coined to describe them. Paris was soon in a frenzy of speculation, conspiracies, and insatiable consumption. Before this first boom-and-bust cycle was complete, markets throughout Europe crashed, the mob began calling for Law's head, and his visionary ideas about what money could do were abandoned and forgotten.



In Millionaire, Janet Gleeson lucidly reconstructs this epic drama where fortunes were made and lost, paupers grew rich, and lords fell into penury-and a modern fiscal philosophy was born.

Editorial Reviews

Mark Frankel

Thoroughly researched, Millionaire is a marvelous read that animates its flawed hero while intelligently illuminating his time.
— BusinessWeek

Forbes Magazine

Extraordinary, true story of a fugitive Scotsman John Law, wanted in England for killing a man in a duel in 1694. Law ends up in France, where he quickly, briefly becomes the most powerful man in Europe’s most powerful country, thanks to an elaborate inflationary scheme. Like most states, France was perpetually short of cash. Instead of having gold and silver be the coins of realm, Law reasoned, why not print money? Law naively thought political authorities would soberly control the printing presses. (England knew better; it was moving to a gold standard.) Law was soon disabused of that notion, but instead of walking away, he devised grander, ever more desperate stopgaps to keep the game going. Britain, too was going through a bubble, but its developing financial institutions, primarily the Bank of England, enabled London to better weather the resultant storm. Subsequently, the Brits, with a sound currency and the rule of law, were able to raise vast sums of money at reasonable rates to finance a war effort that bested the French in North America, despite France’s having four times Britain’s population. (19 Feb 2001)
—Steve Forbes

Library Journal

In a marvelous follow-up to The Arcanum, Gleeson tells the story of "Jessamy John" Law, a brilliant mathematician, author, banker, womanizer, and killer who was condemned to die, escaped from prison, and rose to superstardom as France's financial controller. The problem he faced, much as we do today, was how to maintain public confidence in a credit-based financial system that relied implicitly on intrinsically valueless money. His bank, the Banque Royale, was the first national bank in France to rely on the issue of paper money to build its advantage. His organization, the Compagnie d'Occident, or Mississippi Company, sparked the first major international stock-market boom and bust by promising a field of drams based on the unexplored riches of the Mississippi River Valley. The author's short epilog provides relevance by noting the lasting effects of John Law's system and the still-present tools of instability that underlie today's financial markets. Gleeson tells the story of this flawed, brilliant man in the context of his time. Recommended for public libraries. [Previewed in Prepub Alert, LJ 3/15/00.]-Norman B. Hutcherson, Kern Cty. Lib., Bakersfield, CA

Diana B. Henriques

Her obvious passion for her story carries the reader along from crisis to crisis, and her eye for sensual detail allows her to recreate vividly the opulent world of French regency society.
—The New York Times Book Review

The New Yorker

Gleeson is a gifted biographer whose book reminds us that finance is a passionate as well as a rational endeavor.

Kirkus Reviews

An engaging, enlightening biography of the Scottish financial genius Law (1671-1729), whose innovations created for 18th-century France a remarkable but evanescent economic boom. Gleeson (The Arcanum, 1999) is a storyteller with uncommon gifts: here he unsnarls the complicated tale of a complex man who revolutionized the way people think about money. The son of a prominent goldsmith in Edinburgh, Law showed early promise in fencing and tennis—but most notable were his formidable mathematical talents, which enabled him to profit substantially from a variety of games of chance. In 1694, however, he killed the son of a powerful London family in a duel and soon found himself convicted of murder and sentenced to hang. Friends arranged for his escape, and he crossed the Channel to the Continent, where he began life anew. In Genoa, he eloped with another man's wife. In the Hague, he befriended a nephew of Louis XIV—a connection that would eventually result in his rise to the top of the French financial bureaucracy and make him "the richest subject in Europe." With lucent wit, Gleeson chronicles Law's rise and fall. Most intriguing are her accounts of his creation of the Mississippi Company, a stock venture that generated one of history's greatest boom-and-bust stories. Law, who had already convinced the French government to begin issuing paper money (to compensate for the critical shortage of coins and precious metal), sold shares in France's holdings in America. Soon people from all walks of life made enormous fortunes as the price of the stock skyrocketed (occasioning a new word—"millionaire"). But all collapsed when word spread that nolargedeposits of gold or silver had been found in the New World. During one of the ensuing "runs" on the banks, a dozen people died, trampled underfoot by the stampede of fearful depositors eager to reclaim their investments. Law, his life at risk, fled the country in disgrace and died broke in Venice. A brilliant cautionary tale whose relevance to the volatile economies of today is remarkable—and alarming.

Product Details

BN ID:	2940173092700
Publisher:	Tantor Audio
Publication date:	10/19/2021
Edition description:	Unabridged

Read an Excerpt

Chapter 1: A Man Apart

He came to Paris, where he cut such a fine figure that he held the bank at Faro. He usually played at the house of a famous actress, where they played for high stakes, although he was in as great demand with Princes and Lords of the first order, as in the most celebrated academies, where his noble manners and even temper, distinguished him from other players.

Barthélemy Marmont du Hautchamp,
Histoire du système de finances(1739)

It is an evening in November 1708 in the Parisian salon of Marie-Anne de Chateauneuf -- "La Duclos" -- a celebrated actress of Paris's Comédie Française, and as usual she is entertaining Parisian society. Despite the lustrous presence of sundry ducs, marquis, and comtes, talk is uncharacteristically desultory. France is in the throes of the world's first global war, the War of Spanish Succession, which has raged already for seven years and will endure for another six. This country, the most powerful and populous in Europe, has been ruined by the perpetual conflict. But this cocooned Parisian circle is scarcely conscious of it: the talk is not of the devastating defeats France has suffered at the battles of Oudenaarde, Turin, Ramillies, and Blenheim. It focuses instead on the move of the elderly Louis XIV, the Sun King, and his court from Versailles to Marly, and the love affairs of the fascinating but capricious Duc d'Orléans.

Those who find these topics less than engaging are drawn instead to the cluster of players engrossed in a card game, faro. Most are habitués of the tables -- at this level of society everyone knows everyone else -- but among them one man stands apart. He is fashionably clad as one would expect in a wide-skirted velvet coat, unbuttoned to reveal a damask waistcoat and cravat of Brussels lace, while a periwig of black curls cascades over his shoulders. But at over six feet tall -- a remarkable stature in these diminutive days -- he is a man of grand and imposing looks that according to one acquaintance "places him among the best made of men." Amid the twitchy players, he is also remarked for his gentle and insinuating manners, a serenity of temperament that amply reflects his outward appearance.

During a lull in play La Duclos proudly presents the stranger as John Law, a Scottish gentleman visiting Paris. Her guests soon realize, however, that although Law is as charming and witty as he is physically attractive, he's reticent when questioned on his circumstances. They also discover, as the evening progresses, that he is a master gambler.

According to the rules of the game, the players must defeat a single opponent, the tallière, or banker, to win. This evening Law has been permitted to pit his wits against the rest and adopt the solitary role of opponent. He is the bank. As the stakes grow higher, the players' mood shifts from studied composure to overt unease, and a crescendo of voices pledge increasingly reckless sums. But no matter how great the amount at risk, Law never relinquishes control over his outward expression.

Each player chooses one, two, or three from a deck of cards on the table before them, using gold louis d'or as their stake. Slowly the croupier takes his pack, discards the uppermost card, plays the next two -- the loser and the winner -- and places them in front of him. Winning depends on players having selected the same number as the second card dealt by the croupier (suits are irrelevant), so long as he does not deal two cards of the same face value, in which case the banker also wins. The dealing continues, players betting on every draw until three cards remain. The room is transfixed for the final turn, when the players must guess the cards in order of appearance. Inevitably, Law triumphs over most. He scoops the gold coins he has accumulated into the leather purses he has brought with him, leaving the losers, ruefully, to review their depleted wealth. Once again he has apparently defied the laws of chance and emerged spectacularly victorious.

Few among those present perceive that he has been assisted by anything more than unusual good fortune. Years later his closest acquaintances, such as the Duc de Saint-Simon, failed fully to understand his gaming victories, and described him as "the kind of man, who without ever cheating, continually won at cards by the consummate art (that seemed incredible to me) of his methods of play." In fact, success on this scale has almost nothing to do with luck or consummate art but lay in ensuring that the odds are stacked heavily in his favor. Even when not in the lucrative role of banker, by marshaling a remarkable mathematical intellect and employing his understanding of complex probability theory, of which few are aware, Law was able to measure with astonishing accuracy the likelihood that a given card would appear. To him there was little doubt about the evening's outcome.

Not far from the opulent interior of La Duclos's salon, in a plain but comfortably appointed apartment of the Benedictine Priory in Faubourg St. Antoine, was one of the few men in Paris to whom John Law's success was of pressing concern. Marc René de Voyer de Paulmy, Marquis d'Argenson, Paris's superintendent of police, was as physically unattractive as Law was outwardly engaging, with sallow skin and deep-socketed eyes. He was noted chiefly for his "subtle mind" and "natural intelligence," and his business -- others' secrets -- was a métier at which he excelled. As the eagle-eyed Duc de Saint-Simon remarked, "There was no inhabitant [of Paris] whose daily conduct and habits he did not know."

D'Argenson relished sophisticated company and felt easy in the elite world to which John Law's gaming skills had given him access. During the decade he had held his position, Law's sporadic appearances and extraordinary successes had grown increasingly perturbing. D'Argenson was convinced that John Law was filling some secret role for the British, or that he constituted some other even more insidious threat. His unease deepened when, despite every attempt to find out more about Law, intelligence was discovered to be worryingly sparse. Some said he was a fugitive from British justice, that he had escaped from prison, where he had been sentenced to death by hanging for killing a man. His fortune was variously rumored to have come from gaming tables in Vienna, Rome, Venice, Genoa, Brussels, and The Hague, or from an inherited Scottish estate. But all this was hearsay and speculation. A year earlier, when d'Argenson discovered Law intent on masterminding a dangerous scheme that might undermine France's economy -- the introduction of paper money to France -- he had expelled him from Paris. Now the King's foreign minister, the Marquis de Torcy, had informed him that not only was Law back without a passport but that "his intentions are not good," and that "he is serving our enemies as a spy." Torcy was worried and wanted to know more. D'Argenson, equally disturbed, had attempted for some weeks to track Law down. The quarry had proved elusive.

Copyright © 1999 by Janet Gleeson

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