As more paper money was issued by France, the financial situation got worse. As the crisis grew, however, it seemed that the French people refused to place the blame on the government, which was actually depreciating the currency. While the people seemed ignorant of what was causing their troubles, the government capitalized by continuing to pass laws that only made the situation worse.

More Fiat Money is Put Into Circulation

In December 1791, a report was made in favor of an issue of 300 million more livres. On December 17, 1791, the new assignats were issued, bringing the total to 2.1 billion livres. Inflation grew rapidly and more decrees were given to issue more currency. By later 1792, 3.5 billion had been issued and the purchasing power of the livres or franc diminished greatly.

The French Begin to Point Fingers

There were fluctuations but, generally, there was a downward trend in the value of the currency. People could no longer afford such necessities of soap and bread and mobs formed and began to steal from shopkeepers. The people, however, saw the shopkeepers raising the prices and blamed them instead of blaming the government for its continuing control of the ever-declining currency.

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