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- Fiat Money Inflation in France - 14/14 -

same time, see Dewarmin, vol. i, p. 136; also Levasseur, vol. i, pp. 230-257. For an account of "new tenor bills" in America and their failure in 1737, see Summer, pp. 27-31; for their failure in 1781, see Morse, "Life of Alexander Hamilton," vol. i, pp. 86, 87. For similar failure in Austria, see Summer, p. 314.

[73] See Marchant, "Lettre aux gens de bonne foi."

[74] See Summer, p. 44; also De Nervo, "Finances françaises," p. 282.

[75] See De Nervo, "Finances françaises," p. 282; also Levasseur, vol. i, p. 236 et seq.

[76] See Table from "Gazette de France" and extracts from other sources in Levasseur, vol. i, pp. 223-4.

[77] Among the many striking accounts of the debasing effects of "inflation" upon France under the Directory perhaps the best is that of Lacretelle, vol. xiii, pp. 32-36. For similar effect, produced by the same cause in our own country in 1819, see statement from Niles' "Register," in Sumner, p. 80. For the jumble of families reduced to beggary with families lifted into sudden wealth and for the mass of folly and misery thus mingled, see Levassour, vol. i, p. 237.

[78] For Madame Tallien and luxury of the stock-gambler classes, see Challamel, "Les français sous la Révolution," pp. 30, 33; also De Goncourt, "Les français sous le Directoire." Regarding the outburst of vice in Paris and the demoralization of the police, see Levasseur, as above.

[79] See Levasseur, Vol. i, p. 237, et seq.

[80] For specimens of counterfeit _assignats_, see the White Collection in the Cornell University Library, but for the great series of various issues of them in fac-simile, also for detective warnings and attempted descriptions of many varieties of them, and for the history of their Issue, see especially Dewarmin, vol. i, pp. 152-161. For photographic copies of Royalist _assignats_, etc., see also Dewarmin, ibid., pp. 192-197, etc. For a photograph of probably the last of the Royalist notes ever issued, bearing the words "Pro Deo, pro Rege, pro Patria" and "Armée Catholique et Royale" with the date 1799, and for the sum of 100 _livres_, see Dewarmin, vol. i, p. 204.

[81] For similar expectation of a "shock," which did not occur, at the resumption of specie payments in Massachusetts, see Sumner, "History of American Currency," p. 34.

[82] See Thiers.

[83] See Levasseur, vol. i, p. 246.

[84] For examples of similar effects in Russia, Austria and Denmark, see Storch, "Economie Politique," vol. iv; for similar effects in the United States, see Gouge, "Paper Money and Banking in the United States," also Summer, "History of American Currency." For working out of the same principles in England, depicted in a masterly way, see Macaulay, "History of England," chap. xxi; and for curious exhibition of the same causes producing same results in ancient Greece, see a curious quotation by Macaulay in same chapter.

[85] For parallel cases in the early history of our own country, see Sumner, p. 21, and elsewhere.

[86] For a review of some of these attempts, with eloquent statement of their evil results, see "Mémoires de Durand de Maillane," pp. 166-169.

[87] For similar effect of inflated currency in enervating and undermining trade, husbandry, manufactures and morals in our own country, see Daniel Webster, cited in Sumner, pp. 45-50. For similar effects in other countries, see Senior, Storch, Macaulay and others already cited.

[88] For facts regarding French finance under Napoleon I am indebted to Hon. David A. Wells. For more recent triumphs of financial commonsense in France, see Bonnet's articles, translated by the late George Walker, Esq. For general subject, see Levasseur.

THE BANK OF NEW YORK, established in 1784, was the only Bank in existence in the city of New York at the time of the French experiment with fiat money.

THE BANK OF NEW YORK AND TRUST COMPANY, which celebrates its one-hundred and fiftieth anniversary in March, 1934, considers it a privilege to be able to distribute some copies of this scholarly article of the late Andrew D. White. The article emphasizes the fact that the use of fiat money in France was in its beginning a sincere effort on the part of intelligent members of the National Assembly to stem the tide of misery and wretchedness which had brought about the Revolution in 1789. But the article also shows clearly that once started on a small scale, it became utterly impossible to control the currency inflation and that after some slight indications of improvement in conditions, the situation went from bad to worse. In the long run, those most injured were the people whom it was most desired to help--the laborer, the wage earner and those whose incomes from previous savings were smallest.

ANDREW D. WHITE had a long and distinguished career as educator, historian, economist and diplomat; his description of the events in France that followed the experiment with fiat money is intensely interesting and well Worth the attention of every thinking person in the United States of 1933.

Fiat Money Inflation in France - 14/14

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