As far back as just before our Civil War I made, in France and elsewhere, a large collection of documents which had appeared during the French Revolution, including newspapers, reports, speeches, pamphlets, illustrative material of every sort, and, especially, specimens of nearly all the Revolutionary issues of paper money,—from notes of ten thousand livres to those of one sou . Upon this material, mainly, was based a course of lectures then given to my students, first at the University of Michi

I am greatly indebted to the generosity of Mr. Andrew D. White, the distinguished American scholar, author and diplomatist, for permission to print and to circulate privately a small edition of his exceedingly valuable account of the great currency-making experiment of the French Revolutionary Government. The work has been revised and considerably enlarged by Mr. White for the purpose of the present issue. The story of "Fiat Money Inflation in France" is one of great interest to legislators, to

Early in the year 1789 the French nation found itself in deep financial embarrassment: there was a heavy debt and a serious deficit. The vast reforms of that period, though a lasting blessing politically, were a temporary evil financially. There was a general want of confidence in business circles; capital had shown its proverbial timidity by retiring out of sight as far as possible; throughout the land was stagnation. Statesmanlike measures, careful watching and wise management would, doubtless

Even worse than this was the breaking down of the morals of the country at large, resulting from the sudden building up of ostentatious wealth in a few large cities, and from the gambling, speculative spirit spreading from these to the small towns and rural districts. From this was developed an even more disgraceful result,—the decay of a true sense of national good faith. The patriotism which the fear of the absolute monarchy, the machinations of the court party, the menaces of the army and the

The first new expedient of the Directory was to secure a forced loan of six hundred million francs from the wealthier classes; but this was found fruitless. Ominous it was when persons compelled to take this loan found for an assignat of one hundred francs only one franc was allowed. Next a National Bank was proposed; but capitalists were loath to embark in banking while the howls of the mob against all who had anything especially to do with money resounded in every city. At last the Directory b

Note: The White Collection at the Cornell University library mentioned in many of the following notes is described here: http://rmc.library.cornell.edu/collections/subjects/frrev.html 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