Thusthesystemcontinuedtoflourishtillthecommencementoftheyear1720。ThewarningsoftheParliament，thattoogreatacreationofpapermoneywould，soonerorlater，bringthecountrytobankruptcy，weredisregarded。TheRegent，whoknewnothingwhateverofthephilosophyoffinance，thoughtthatasystemwhichhadproducedsuchgoodeffectscouldneverbecarriedtoexcess。Iffivehundredmillionsofpaperhadbeenofsuchadvantage，fivehundredmillionsadditionalwouldbeofstillgreateradvantage。ThiswasthegranderroroftheRegent，andwhichLawdidnotattempttodispel。Theextraordinaryavidityofthepeoplekeptupthedelusion；andthehigherthepriceofIndianandMississippistock，themorebilletsdebanquewereissuedtokeeppacewithit。TheedificethusrearedmightnotunaptlybecomparedtothegorgeouspalaceerectedbyPotemkin，thatprincelybarbarianofRussia，tosurpriseandpleasehisimperialmistress:hugeblocksoficewerepiledoneuponanother；ionicpillars，ofchastestworkmanship，inice，formedanobleportico；andadome，ofthesamematerial，shoneinthesun，whichhadjuststrengthenoughtogild，butnottomeltit。Itglitteredafar，likeapalaceofcrystalsanddiamonds；buttherecameonewarmbreezefromthesouth，andthestatelybuildingdissolvedaway，tillnonewereableeventogatherupthefragments。SowithLawandhispapersystem。Nosoonerdidthebreathofpopularmistrustblowsteadilyuponit，thanitfelltoruins，andnonecouldraiseitupagain。
Thefirstslightalarmthatwasoccasionedwasearlyin1720。ThePrincedeConti，offendedthatLawshouldhavedeniedhimfreshsharesinIndiastock，athisownprice，senttohisbanktodemandpaymentinspecieofsoenormousaquantityofnotes，thatthreewaggonswererequiredforitstransport。LawcomplainedtotheRegent，andurgedonhisattentionthemischiefthatwouldbedone，ifsuchanexamplefoundmanyimitators。TheRegentwasbuttoowellawareofit，and，sendingforthePrincedeConti，orderedhim，underpenaltyofhishighdispleasure，torefundtotheBanktwo-thirdsofthespeciewhichhehadwithdrawnfromit。ThePrincewasforcedtoobeythedespoticmandate。HappilyforLaw’scredit，DeContiwasanunpopularman:
everybodycondemnedhismeannessandcupidity，andagreedthatLawhadbeenhardlytreated。Itisstrange，however，thatsonarrowanescapeshouldnothavemadebothLawandtheRegentmoreanxioustorestricttheirissues。Othersweresoonfoundwhoimitated，frommotivesofdistrust，theexamplewhichhadbeensetbyDeContiinrevenge。Themoreacutestockjobbersimaginedjustlythatpricescouldnotcontinuetoriseforever。BourdonandLaRichardiere，renownedfortheirextensiveoperationsinthefunds，quietlyandinsmallquantitiesatatime，convertedtheirnotesintospecie，andsentitawaytoforeigncountries。Theyalsoboughtasmuchastheycouldconvenientlycarryofplateandexpensivejewellery，andsentitsecretlyawaytoEnglandortoHolland。Vermalet，ajobber，whosniffedthecomingstorm，procuredgoldandsilvercointotheamountofnearlyamillionoflivres，whichhepackedinafarmer’scart，andcoveredoverwithhayandcow-dung。Hethendisguisedhimselfinthedirtysmock-frock，orblouse，ofapeasant，anddrovehispreciousloadinsafetyintoBelgium。FromthencehesoonfoundmeanstotransportittoAmsterdam。
Hithertonodifficultyhadbeenexperiencedbyanyclassinprocuringspeciefortheirwants。Butthissystemcouldnotlongbecarriedonwithoutcausingascarcity。Thevoiceofcomplaintwasheardoneveryside，andinquiriesbeinginstituted，thecausewassoondiscovered。Thecouncildebatedlongontheremediestobetaken，andLaw，beingcalledonforhisadvice，wasofopinion，thatanedictshouldbepublished，depreciatingthevalueofcoinfivepercent。
belowthatofpaper。Theedictwaspublishedaccordingly；but，failingofitsintendedeffect，wasfollowedbyanother，inwhichthedepreciationwasincreasedtotenpercent。Thepaymentsofthebankwereatthesametimerestrictedtoonehundredlivresingold，andteninsilver。Allthesemeasureswerenugatorytorestoreconfidenceinthepaper，thoughtherestrictionofcashpaymentswithinlimitssoextremelynarrowkeptupthecreditoftheBank。