The mails of the Niagara reached us yesterday, and a careful
examination of our files of. British journals only confirms the
views we have lately had to express with regard to the probable
course of the crisis in England.* The London money market is
decidedly improving; that is to say, gold is accumulating in the
vaults of the Bank of England; the demand for discount at the
Bank is decreasing; first-class paper may be discounted in
Lombard street *** at 9'/,; to 9°/, per cent; the public funds are
firm, and the share market participates to some degree in this
movement. This agreeable aspect of things is, however, badly
impaired by great failures, recurring every two or three days in
London; by daily dispatches, sad messengers of provincial
disasters; and by the thunder of The London Times, inveighing
more than ever against the general and helpless corruption of the
British mercantile classes. In fact, the comparative easiness with
which unexceptionable paper is discounted, seems to be more than
balanced by the growing difficulty of finding paper which can pass
as unexceptionable. Consequently, we are told in the London
money articles of the latest date, that at Threadneedle street **° the
applications are extremely “limited,” and that at Lombard street
but little business is doing. Still, as the supply on the part of the
Bank and the discount houses is increasing—while the pressure
upon them, the demand on the part of their customers, is
decreasing—the money market must be said to be comparatively
easy. Nevertheless the Bank of England Directors have not yet
‘dared to lower the rate of discount, convinced as it would appear

a See this volume, pp. 406-09.— Ed.

The Crisis in Europe 41]

that the renewal of the monetary crisis is not a question of time,
but of percentage, and that, consequently, as the rate of discount
sinks, the monetary crisis is sure to rise again.

While the London money market, one way or the other, has
thus got more easy, the stringency of the English produce market
is increasing in intensity, a continuous fall in prices not being able
to overcome the growing disinclination to purchase. Even such
articles as tallow, for instance, which had previously formed an
exception to the general rule, have now, by dint of forced sales,
been obliged to give way. On comparing the price current of the
week ending December 18 with the weekly price current of
November, it appears that the extreme depression in prices which
prevailed in the latter month has again been reached; this time,
however, not in the shape of a panic, but the methodic form of a
sliding scale. As to the manufacturing markets, an earnest of the
industrial crisis which we predicted* has now been given in half a
dozen failures of spinners and weavers in Lancashire, of three
leading houses in the woolen trade in the West Riding, and an
important firm in the carpet trade of Worcester.

Since the phenomena of this double crisis, in the produce
market and among the manufacturing classes, will by and by
become more palpable, we shall content ourselves, for the present,
with quoting the following passage of a private letter from
Manchester, which has been communicated for our columns:

“Of the continuous pressure on the market and _ its
disastrous effects you can hardly form any notion. No one
can sell. Every day you hear of lower quotations. Things are
come to that pass that respectable people prefer not to offer
their commodities at all. Spinners and weavers are weighed
down by utter despondency. No yarn commissioners sell
yarn to the weavers except on cash or double securities. It is
impossible for this state of things to go on without ending in
a frightful collapse.” 

The Hamburg crisis has scarcely abated.‘ It is the most regular
and classical example of a monetary crisis that ever existed.
Everything except silver and gold had become worthless. Firms of
old standing have broken down, because they are unable to pay in
cash some single bill that had fallen due, although in their tills

b Marx paraphrases Engels’s letter to him of December 17, 1857 (present
edition, Vol. 40, pp. 222-23). In this article he also uses other data from that
letter.— Ed.

there lay bills to a hundred times its value, which, however, for the
moment were valueless, not because they were dishonored, but
because they could not be discounted. Thus, we are informed that
the old and wealthy firm of Ch. M. Schroder, before its bankruptcy, had offered to it two millions in silver, on the part of
L. H. Schroder, the brother, of London, but replied by telegraph:
“Three millions or nothing.” The three millions did not come
forward, and Ch. M. Schroder went to the wall. A different
instance is that of Ullberg & Co., a firm much spoken of in the
European press, which, with liabilities amounting to 12,000,000
marks banco, including 7,000,000 of bills of exchange, had, as now
appears, a capital of only 300,000 marks banco as the basis of such
enormous transactions.”

In Sweden, and especially in Denmark, the crisis has rather
increased in violence.” The revival of the evil after it appeared to
have passed away is to be explained by the dates on which the
great demands on Hamburg, Stockholm and Copenhagen fall due.
During December, for instance, nine millions of bills drawn on
Hamburg by Rio de Janeiro houses for coffee fell due, were all
protested, and this mass of protests created a new panic. In
January the drafts for the cargoes of sugar shipped from Bahia
and Pernambuco will probably meet with a similar fate, and cause
a similar revival of the crisis.

leading article, and reprinted in the

New-York Semi-Weekly Tribune, No. 1316,

January 5, 1858

4 For the description of the Hamburg bankruptcies Marx used the facts cited by
Engels in his letter of December 7, 1857 (present edition, Vol. 40, pp. 212-13).—
Ed.

b See this volume, pp. 405-06.— Ed.