12 May. 1866. N. 1185.

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The Economist, 12. Mai 1866. S. 553/554.
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The State of the City.

The failure of Overend, Gurney et Co (Limited) has given occasion to a panic more suitable to their historical than their recent reputation. Overend, Gurney unlimited, for the sake of high interest took bad securities. As to Overend, Gurney and Co. (Limited), they did the best they could, but could hardly help bringing over old business of very questionable nature from the old firm. … Lombardstreet has been thronged and almost stopped by curious wanderers in a way we never saw it stopped before, and on the whole we doubt  Kommentar von Marx.
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(trotz seiner beständigen Prophezeiung des Gegentheils!)
if there ever was a collapse of credit more diffused and more complete.

It has hardly been observed how new an element of danger limited cos introduce. The moment the operations of the Stock Exchange depress their prices, that instant a run begins. Many cos may go which did not deserve it merely from the depression of their shares.

Bk. act of 1844 must be suspended. Large sums have been withdrawn from the Banking department to-day, notes to a great amount have gone into the country, discounts and advances at the Bank have swelled to an extent almost unprecedented. If these demands have reduced the Bank reserve to such a state as 1847 and 1848 … it is not a matter of theory (die suspension des Bankacts von 1844) at all; it is plain insolvency and must be mended somehow … After a certain though very late period yesterday, the Bank did not make advances on Gvt. securities, wohl weil their reserve was in danger of exhaustion. If the B.o.E., the sole banker of the English Gvt., will not advance on the securities of that Gvt, there is no saying what may happen to any one. … As to the General state of the trade of the country, we have no doubt of its substantial soundness.  Kommentar von Marx.
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Hurrah!

Aus:
The Economist, 12. Mai 1866. S. 554/555.
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What a Panic is etc.

The provisions of Peel’s Act aggravate alarm. They cause panic where there would have been merely fear. In solchen Zeiten der credit der B.o.E. is augmented. In the ordinary working of banking in England, a mechanism of diffused credit economises the use of banknotes, of visible instruments of exchange, of money in the ordinary sense of the word. By the aid of the clearing house, of country bankers, of London bankers, of the B.o.E. all working together … the most important bargains are settled without the use of any banknotes or coin whatever. A cheque is given, and by the aid of the system of set-offs, this bit of paper pays for cotton or indigo as effectually as sovereigns, and pays for it in every part of the kingdom. Darin all wholesale transactions settled. Mit Ausnahme des North of England, where a rather barbarous mode of charging bank commissions restricts the use of cheques and banking, no one pays any large debts except by cheque. The wholesale currency of the country is a ledger currency – a currency of bankers’ deposits transferred by bankers’ cheques. Banknotes in general, and in their customary use, are but a retail currency. Small matters are settled by them; large matters are settled without them. In a panic this auxiliary and supplementary currency is at once in part annihilated. Its very |54 foundation is taken away. That foundation is credit, and there is discredit. A person f.i. who has lent money on securities will not take his debtor’s cheque and give up these securities. He asks for banknotes. The general machinery by which bargains are settled and debts paid in this country is in times even of commencing panic disturbed and superseded. The Banknote is a most coarse form of credit as compared with the cheque currency. Taking a banknote (even when not a legal tender) only involves trusting the Bank; but taking a cheque presumes also a trust in the cheque giver.  Kommentar von Marx.
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(Viel weniger als by bills of Exchange!)
Weil in dem panic die cheque currency partly destroyed, we fall back on credit of the first sort, upon Banknotes. We require more Banknotes, just because the feeling, the confidence which made few Banknotes effectual has disappeared. The same cause operates in another way at the same moment. Die country bankers provide themselves mit notes etc[.] Wenn Scotch or Irish issuing Bank should fail, die other Scotch or Irish banks would issue notes upon bullion to fill the void, but obtain that gold by getting a credit balance at the Banking Department of the B.o.E., by drawing a cheque on that balance, by getting notes in payment of that cheque, and getting those notes paid in gold at the Issue Department. Those notes are then cancelled, but the effect is the same as if they had been taken to Ireland, or Scotland, and there issued. The panic has in both cases destroyed the local circulation, and taken notes out of the Banking Department of the Bank to replace them. In one case it has issued and in the other destroyed them; but that is immaterial: the demand on the Bank issue, the void in London is the same.

Also pressure on the Banking Department of the B.o.E. More notes are required, taken out of the reserve there. Dazu Bk.o.E. notes a legal tender. … Yesterday (11 Mai 1866) was perhaps the worst day ever known in a week of that sort.

Aus:
The Economist, 12. Mai 1866. S. 559/560.
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The Irish Landbill.

Fortescue’s bill. Tells us that it is merely to render the Act of 1860 effective. Aber das Neue drin: a provision giving a tenant a claim on his landlord in consideration of outlay incurred, irrespective or even in defiance of the landlord’s wishes … The assertion in a general form of the subordination of the Landlord’s right in his property to the public welfare has not yet been made in distinct terms in an Act of Parliament. This would be entirely sound.

The proper object of a measure for tenant-compensation is, to secure to the tenant full property in the thing he has himself created, or, in lieu of this, its value from the man who under the law may appropriate it. It is, however, an inevitable circumstance that the value which the tenants tenant adds by his improvements to his farm becomes, when the outlay has once taken place, inextricably blended with the general value of the land: it is thus a preliminary condition to the practical solution of the problem that a separation should, with at least approximate accuracy, be effected between the elements of value added to the land by the tenant’s outlay and those due to the general circumstances of the country. Moreover, in all progressive communities the value of land – as a consequence of the longer demands made upon it for subsistence by an increasing population – and wholly irrespective of agricultural improvement tends to rise, wozu jezt noch kömmt die immensely increased production of gold and silver. 100l. means not now what before the Australia et California discoveries. This affects wie den price aller Dinge the price of land. … A railway runs through a district, and the value of land in the district rises …

There may, or may not, be good reasons for retaining the land of a country in the hands of the State. The benefit of its augmenting value may thus be reserved for the community at large.

Confiscation is not for us the word of horror which it is for most of our countrymen. We can |55 well believe that a well-devised scheme of confiscation might easily be made productive of solid benefits to Ireland; nor should we shrink from this expedient were it necessary for the regeneration of the country. But our objection to Mr. Fortescue’s measure is that while paying the cost of confiscation, it secures none of its gains.

In dem Act steht: „The Gvt. do not propose to interfere with perfect liberty of contract.“ And the Act is only to come into operation „wherever there is no written contract to the contrary“. The measure is thus rendered absolutely innocuous, but also … perfectly idle. Do the Gvt. really suppose, that Irish landlords will incur the risk of indefinite claims being run up against them by their tenants if they have it in their power to prevent this by the simple expedient of an additional clause introduced a common form into every lease?

Aus:
The Economist, 12. Mai 1866. S. 563–565.
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Money Market.

The business of the old firm Overend and Co in July last (1865) transferred; its suspension followed by that of the English Joint Stock Bank, a still more recently created establishment. Some pressure during the day at a few of the banking houses, but all claims have been satisfactorily met in that direction. At the B. o. England the demand has been heavy; in other quarters the transactions reported are extremely few.

Rapid rise in the discount rate, to day advanced to 9%, seems to have checked demand and the export of bullion.

Chief failures transpired to-day those of 2 or 3 contractors unable to obtain the advances upon which they had been accustomed to rely. Also reported stoppage of a Liverpool House in the iron trade.

In all securities the depreciation has been sudden and beyond precedent within last 20 years.

Foreign Stocks. The rapid decline on the French Bourse and the pressures of sales on the extremely limited market in London occasioned a further excessive decline in prices.

Railway Shares: considerable decline in prices compared with those of last week. The chief depreciation may be attributed to the realisations of those who, to meet losses, have been compelled to sell any high investments at command. There is very little doubt that operations for the fall have had much to do with the further reductions noted in the list.

On Financial shares the panic has acted with unprecedented violence. Concentrated in its form on account of the limited space upon which it has been only able to act, the present panic in financial shares exceeds all that has been previously witnessed, although the depreciation of the past few weeks had been severe and extensive. At this moment the difference between the par value of shares on the „Miscellaneous“ list, and the quotations of this evening amounts to somewhere about 15,000,000l. St. Today the dealers have mostly refused to deal, except to close account; and the consequence of a resolution of this kind following upon a crisis like the present is the closing of a vast number of accounts, and the extinction in many cases of whole fortunes involved on too large a scale in shares on which the dividend depended entirely on the realisation of assets now rendered impossible. In many cases the profits declared have had no existence except on paper, and subject to the safe conclusion of the operations in which the societies had engaged.

Banking shares have suffered afresh; the degree is only inferior to that of the Financial Co. shares, but the results so far have been less disastrous.

Failures: Gibbs, Brothers Ironworks, liabilities 25,000l.; the English Joint Stock Bank limited, today followed Overend; W. Shrimpton, of Westminster, suspension; Bills of Sir Morton Peto returned last evening, and, we fear he will not be able to resume payment.|

56

Aus:
The Economist, 12. Mai 1866. S. 569.
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Cotton market. Liverpool.

Much depression. Quotations for Americans and East India are reduced all round 1d. per lb since Friday last. To-day there has been quite a panic in the market; sales about 3,000 bales, at prices quite nominal.

Aus:
The Economist, 12. Mai 1866. S. 571.
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Manchester. May 10.

Iron has given way considerably.

Prices have continued their downward course day by day. Both yarns and goods quoted 1 to 2d. per lb down since last week.



March 30. 1867. N. 1231.

Aus:
The Economist, 30. März 1867. S. 352.
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Mr. Torrens’ Bill for Improving the Dwellings of Artisans.

Till now die „rookeries“ in towns etc can be cleared und inspected, but not pulled down, except by the owner. Torrens proposes, in the interest of public health and working men’s comfort, to enable any magistrate, or municipal council, or vestry, or other local authority with jurisdiction, to compel the landlord to abate the nuisance. The owner of any house, or group of houses, unfit for human habitation may, on a report of the health officer condemning such houses, be summoned before the Grand Jury to explain their condition. If he fails to do so, the Grand Jury may issue an order for the completion of any necessary works, even if they involve the total destruction of the buildings, and on this order the „local authority[“] must act. They will order the owner to perform the work, and if he declines or delays, they may tender to him the value of the premises, and enter into possession of them themselves. When so entered, they will be entitled to borrow money from the State, and with it erect buildings suitable for the labouring classes, paying the interest out of the receipts from the new buildings, or out of a local rate. The local authority is not, however, to keep the buildings, but to sell them within 7 years. The purpose of the Act is, to enable any municipality, or authority like the Metropolitan Board of Works, to take at a valuation the „rookeries“ in great cities, and either clear them away or cover them with habitable dwellings for the poor. … Land in towns is limited in quantity – that is, houses too far from business centres are useless to relieve those centres. … The demand may exist, indeed, does exist; but supply is not afforded, because there is no unoccupied space on which to build … There remains … only force, and this is applied in the gentlest manner, the landlord not being compelled to sell unless he refuses to protect the public health and morals in the way required of him, and when compelled, receiving the full money value of his property. … For the rest, the Bill, as it stands, is only important in principle. In practice it is too cumbrous to be of very great use. A few very bad fever centres will, no doubt, be swept away; but we shall have to go very much further than this, especially in London, Glasgow, Liverpool, and Bristol, before we succeed in securing that great necessity of modern civilisation, the decent and healthy housing of the mass of the people.



Inhalt:

  • London. 1868.
  • 1866 „The Economist“ (Jahrgang 1866) vol. XXIV.
  • The Social Economist, 1. Oktober 1868
  • „The Economist“ (Jahrgang 1866) (Fortsetzung)
  • Jahrgang 1867.
  • Register der obigen Auszüge aus dem Economist für 1866 und 1867.
  • The „Money Market Review“. Jahrgang 1866.
  • The Money Market Review. Jahrgang 1867.
  • Register Money Market Review Jahrgänge 1866 und 1867