June 27. 1868.

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The Money Market Review, 27. Juni 1868. S. 683/684.
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Railways 1845–46.

First application to Parliament for a bill to construct a railway 1801, for a line between Wandsworth and Corydon Croydon. Von 1801–1825 Acts were obtained for 28 more railways. After 1825 the movement quicker. 1845 there were in existence Acts of Parliament for 412 railways, to be constructed at a cost, in round numbers, of £155,000,000. Average of railways up to 1845, not financially prosperous, but then a mania. George Hudson appeared upon the scene, indoctrinated the community mit belief that railways were mines of gold. He became chairman of the Midland Railway, of the York and North and Midland, of the York, Newcastle, and Berwick, of the Eastern Countries, and others. In that capacity he thought fit to lease at 6% the Birmingham and Bristol, which had never before earned 2% p.a.; and by this lease the value of the share was raised from some 60 or 70£ p. share to 150£. Upon the announcement of this lease, the shares in the railway concerned rose in one day nearly £50 in market value. Then followed other railway leases. The „Great North of England“ was taken over at 10% p.a., with a corresponding increase in market value, and then the Leeds and Bradford, and the Hull and Selby, likewise at 10%. Next, the Eastern Counties, which had struggled on for years with scarcely a dividend at all, suddenly paid 7% p.a. under Hudson’s magic sway, and the price of the shares rose 3 or 4 ×. But perhaps the most remarkable instance of the effects of his regime was the establishment of a premium of about 28£ p. share upon the Newcastle and Berwick before a sod was turned, and though there was only £2 p. share paid up. These facts were quite enough to send the world mad. It was schön to obtain a profit of £28 in one week by paying £2, and here was the foundation of the railway mania of 1845. Adopting Hudson’s plan of action, other railway Cos. followed in his wake, and there stands on record a great battle between the London and Northwestern and the Great Western for possession of the unmade railway from Oxford to Birmingham, the one offering 175% premium for the shares, and the other 50 P.Ct. Then came a host of other leases at fixed rates of guarantee – the Trent Valley; the Lancaster and Carlisle; the Preston and Wyre; the Bolton and Bury; and numerous others. The railway world lost its senses. It was only to buy and to double, treble or quadruple the purchase money. But then supervened a still more questionable class of adventure. Baseless projects were set on foot in all directions. Such a scheme as the „Manchester and Southhampton“, before even the Bill was lodged, and for which an act of Parliament was never obtained, was at £4 to £6 premium; while the South Devon, the „Direct Exeter“, the South Wales, and a host of others, some of which had never any real existence, commanded any premium that mad speculation could conjure up. The „South Midland“ – a project for a line from Hitchin to Leicester – stood at 12£ premium, the Banburry and Cheltenham at 7 or 8£ Prem., and even the Cornwall at £6 or £7 premium. Great Western shares, with £80 paid, at one period approached the enormous price of £235. London and North Western were at nearly £250; and difficult to say what railway share in the market was not at some ideal premium, on the same scale, and the same false computation of profit. Then came the reaction. Found that the profits upon which Hudson had based his 10% leases and similar arrangements, were wholly imaginary. He paid dividends out of capital, and, to use the words of an official before the |38 Eastern Counties Railway Investigation Committee, he achieved his purpose by the rule that, „capital was to bear what revenue would not“. Easy to pay dividends on such terms, until public saw that the whole a farce, then down came the entire fabric, involving in utter ruin 1000ds of families.

Aus:
The Money Market Review, 27. Juni 1868. S. 686.
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The Extraordinary Subsidies of the French Gvt. to the Messageries Impériales.

This Co. undertook its mail contract with India and China via Egypt in 1861, with all the advantages derivable from the 17 years of costly trial and experience gained by the (Brit.) Peninsular and Oriental Co. French Gvt. conceded to that Co. subsidies, to be payable out of French taxes for 24 years, without competition, equal in amount to 3 × the amount of subsidies payable to the English Co., with competition, at intervals of 6 or 8 years. Auch sonst enormous advantages und guarantees conferred upon the French Co. without parallel in the contracts of the British Gvt. with the Peninsular and Oriental. Now another contract with the favoured Messageries submitted to the Corps Législ. Hitherto the mail service of France in the South Pacific performed by the British mail steamers, without cost of 1 single d. to French Gvt. or people. Messageries are ambitious to conduct it; with subsidy of no less than 3 times the mileage rate now paid by the British Gvt. for the same service. In addition to this, the Messageries are to have a loan from the Gvt. of £160,000, and their shareholders the guarantee of the Imp. Gvt. of 5% dividend upon their capital … Gratuitous squandering of Public Funds upon speculative monopolists unable to sustain themselves in fair competition.

Aus:
The Money Market Review, 27. Juni 1868. S. 693.
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The West Wisconsin Railway.  Zusatz von Marx.
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(Land und Eisenbahn in U. St.)

Wisconsin in part covered mit immense forests of most valueable timber; possesses a rich vegetable soil, averaging a depth of 2 feet; most prolific in minerals; the great level region of the Mississippi lies chiefly within its limits. Is already 2nd wheat producing State in Union. Population at last census was 800,000. Its area 54,000 □ miles, little less than that of England and Wales. Is deficient in railway communications. British capitalists invited to promote that object. Some proposed the West Wisconsin line, to be 157 miles in its total length, running in a north-westerly direction, from Tomah, on the south east, where it connects with the lines from Milwaukee and Chicago to Hudson, on Lake St. Croix, whence it will soon connect with St. Paul’s, the capital of Minnesota, where the great railways of the West concentrate. It passes through a fine farming country in a high state of cultivation, as well as through forests of pine, walnut, maple, and oak; and along the whole route are not only farms but numerous steam saw mills and flour mills, furnishing the means of a constantly growing freight traffic. The Congress of the U. St., as an aid to the construction of the line, made some years ago a grant to the Co. of 1 □ mile of land for every mile in length of road constructed – that is to say, of 1,004,800 acres. The value of these lands, at the present legal minimum price is 4,512,000$ or £900,000. … The value of land is reckoned von 21/2 $ to 5$ p. acre. At the present moment the lands of the Illinois Central Co. have improved to average of nearly 11$ per acre; and the West Wisconsin lands as rich, if not richer, naturally.

Inhalt:

  • Inhaltsverzeichnis von Friedrich Engels
  • 1869 I Heft
  • Money Market. 1868.
  • Money Market Review. Jahrgang 1868.
  • The Economist. Jahrgang 1868. Nachträge
    • The Economist. Jahrgang 1868.
    • Inhaltsregister für 1868 Jahrgang. („Money Market Review“ und „Economist“.)
    • Kommentar zu George Joachim Goschen
      • George J. Goschen: The Theory of the Foreign Exchange. 7th edit. London 1866.
      • Friedrich Ernst Feller, Carl Gustav Odermann: Das Ganze der kaufmännischen Arithmetik
      • Inhalt.