November 21. 1868.

The Money Market Review, 21. November 1868. S. 467.
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Money Market. Rise in Bankrate of Discount.

From 2%, fixed on 25 July 1867, raised to 21/2% on 19 Nov. 1867. Anlaß dazu: The unprecedented withdrawal of 1 Million £ in gold for shipment to Russia.

A 2% Rate has now existed at 3 different Periods:

Rate of 2% und Dauer derselben.
1st Period. von April 22, 1852 to January 6, 1853 37 weeks
2nd Period. July 24, 1862 to October 30, 1862 14 weeks
3rd Period. July 25, 1867 to Nov. 19, 1868 69 weeks, 5 × that of ’62 und almost 2 × that of 1852.

This 2% rate (25 Jul. 1867 – 19 Nov. 1868) has lasted longer than any other Bankrate since Act of 1844:

Discount Rates since Act of 1844 lasting without interruption for more than One Year:
2% for 69 weeks ending Nov. 19, 1868
21/2 P.Ct. 58 weeks Oct. 16, 1845
21/2 P.Ct. 57 do. Dec. 26, 1850
3 do. 55 do. Nov. 22, 1849
3 do. 53 do. Jan. 1, 1852

The higher the rate is carried and the longer it it is maintained in that position, the surer reaction to the other extreme, and the longer it must prevail:

Crisis Rates and Reaction and lasting of Reaction Rate.
Prior to 1847 a higher point than 6% never known.
Crisis of 1847: 8% for 4 weeks. Followed by continued decline until 22 Nov. 1849, when 21/2%; in force for 57 weeks.
Crisis of 1857: 10% for 61/2 weeks, then gradual reduction to on 9 Decemb. 1858 to 21/2%; which lasted only 20 weeks.
Crisis of 1866: 10% for nearly 14 weeks, reduced to 3% in less than 6 months, und 2% within a year, lasting for 69 weeks.

Vergleichen wir Bank o. England mit Bank o. France this week, so finden wir:

Bank o. England.
Decrease of coin and bullion £1,002,191
Increase in Discounts and Loans 556,817
Decrease in active circulation 447,215
Es ist hier Increase des Verleihns von Kapital und Decrease in active Circulation; Notes withdrawn for gold for Export.

Bank of France.
Decrease of coin and bullion £449,494 Issue: £46,506,627
Decrease in bills discounted 13,423 do. 18,627,382
Increase in Notes in Circulation (Issued 54,170,814): 246,216 Hier also mit Decr. of Capital loan und Decr. of Bullion, Increase in Note Circulation.

Die Increase der Notes in Circulation der B.o.F. trotz Decrease of Bullion und Decrease des Discount Business, erklärt durch Decrease of Private Deposits und Treasury Balance, as seen by:

Private Deposits. Summe: 12,952,484 Decrease: 467,684
Treasury Balance: do. 6,971,087 Decr. 142,610|


The Money Market Review, 21. November 1868. S. 467/468.
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U. Kingd. National Income and its Resources.

A.) Customs.
Tobacco (40 mill. lb unmanufactured Imported) nearly 61/2 mill. £

Sugar. Refined and unrefined (The Grocers’ Duty) u. stuffs worin sugar ingredient

5,765,501£ St.

Unter diesen Zucker Artikeln „glucose or vegetable syrup“ £2,722. Almond Paste: (40 lbs imported) 0. Dried cherries. 3£ only. 2 pound of comfits for children, paid 0.

Marmelade: 5£. Preserved Plums: £4. Ridiculous customs, do not defray their cost of collection.

Tea and coffee (raw and roasted) chicory (raw or kiln dried)

Cocoa and its husks and shells, and its paste or chocolate


Spirits and articles containing spirits (spirits sweetened, unsweetened, but mixed, chloroform, collodion, ether und varnish containing alcohol) £4,301,620 (Chloroform only £70, ether 54l., collodion £8,  Kommentar von Marx.
ridiculous customs
Corn and grain £883,941
„Dried Fruits“ including currants, figs, plums, prunes, raisins £421,740
Importations of malt and its products with their substitutes £3,709
Gold and Silver Plate £4,250
Playing Cards £376
All customs in year ending March 31, 1868 £22,808,140
do do 1867 22,355,859
do do 1866 21,356,723
B) Excise Duties or Inland Revenues.
Duty on chicory somewhat over £21,000, aber auf:
Duties on  The Money Market Review: spirituous
drinks. (inclusive customs)
From Foreign Spirits £4,301,620
Wines 1,500,000
Malt 6,575,263
Home made spirits 11,346,181
Brewers’ licences 357,000
Maltsters’ do. 15,884
Dealers. do. 1,000,000


If we add 61/2 Mill. £. from Tobacco, 331/2 Mill. l. derived from drinking und smoking.

Railway Duty. „5% on sums received for conveyance of passengers“ £485,136
Stage Carriage Duty of 1 farthing for each mile travelled £35,857.
Hackney Carriage Duty of 7s. p. week, or 6s. p. week if not used on Sundays £103,153
Licences to makers of playing cards £16
do. to sellers of same £1,066.
Licence to kill game £150,949
Licences on dogs upwards of £400,000
C.) Stamps.
Stamps on deeds etc £1,620,426
do. On Probate of wills and letters of administration £1,771,832
do. On Legacy and Succession to Real Estates


The income from the succession to real estate still utterly disproportioned to that derived from legacies of personal estate, and returns of these duties still mixed up and confounded with the legacy duty in order to conceal that disproportion.

Total of stamp duties £9,737,573.
D.) Taxes.
Landtax (other tax under the cover of which landowners escape payment of their fair quota) £1,106,695
Inhabited House Tax £1,068,984, almost as much as land tax.
Income Tax £6,287,079
2) Property and Income Tax under Schedule A (lands, tenements etc) £125,070,065

3) Income Tax under Schedule D (trades, professions etc)

Both are rated alike at 5d. in £.

Aggregate Amount of Inland Revenue.
Excise £21,323,848
[Stamps] 9,737,573
[Taxes] 9,752,561
 Bemerkung von Marx.
Inland Revenue: £40,813,983
Customs: 22,808,140
Post Office: 4,558,962
Total: £68,181,085.
The Money Market Review, 21. November 1868. S. 472/473.
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The East India Irrigation and Canal Co.

 Zusammenfassender Kommentar von Marx.
The alternative: Government takes the Orissa undertaking (see p. 50) oder die shareholders müssen verdammt blechen.

The Indian Gvt. has been forced by public opinion to give a great expansion to the practice of irrigation. As a rule better that the Gvt. should be the direct seller of the water, because it can adapt the price to the charge made for the land in such modes that the cultivator will be obliged to take the water. It was clumsy contrivance that Cos. with unguaranteed capital should first sell the water to the Gvt., and then the Gvt. to the cultivator. In the event of a failure of crops from want of irrigation, the Gvt. thus escaped its responsibilities. The Gvt. policy not always consistent in the matter of the Orissa works. At their commencement, and for some time afterwards, the Co. received the cooperation of the Gvt., which was cordially rendered. But, whether from the growth of conviction that irrigation ought to be the sole work of the Gvt., or from the feelings excited in consequence of the failures in the crops having produced famine, this cooperation began to be given in a perfunctory way, and at the present time it cannot be calculated upon. The East India Irrigation Co. has a right to complain of this change. But, on the other hand, the Gvt. complain of the delay which has occurred in the execution of some of the works undertaken by the Co., and forming part of their whole scheme; because, after all, the ultimate responsibility of disaster from the state of crops falls upon the executive. Before matters arrived to this point  Zusatz von Marx.
(wo Gvt. offers to undertake the whole)
the directors reported to the proprietors that the completion of the several sections of the Orissa works would cost £1,500,000. But early in the present month the chief Engineer in India reported that £420,000 must be added to this estimate. The capital of the Co. being £1,000,000, it follows that £920,000 more required before the works undertaken can be completed. Though an area of acres 700,000 would be irrigated by this expenditure, the works could not be completed without the money, and, meanwhile, the call for their completion is urgent, under a sort of pressure impossible to resist. The directors applied to the shareholders to supply new capital, but subscriptions little more than £70,000, the payment of which extended over 4 years, while the balance of unexpended capital in England had been reduced to £33,000. Demonstrated by this fact that further share capital not to be raised.

The Money Market Review, 21. November 1868. S. 474.
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The Board of Trade Returns and the Trade of the Country. Sept. ’68.

The Board of Trade Returns show improvement in September ’68, as compared with same month ’67 and ’66, but the great bulk of our export trade, consisting chiefly of the staples of Lancashire, is not only not flourishing, but the reverse. It has been so ever since the great fall in values, since the termination of the American war. There has no been no continued healthy trade with our Eastern markets since the Indian mutiny. The profits realised during the American war were spasmodic and unnatural, and the immense fortunes then accumulated, have since all been more than lost, and have been succeeded in Lancashire by a period of reverses unknown even during the cotton famine. Estimating all the charges upon shipments to our Eastern markets upon the most economical scale, and they are favoured by the low rates of freights now ruling, the prices obtainable at all the ports show a considerable loss of shipments now made, and there is no experience to show that the present is a less favourable time for ventures than any previous time of this year.

The present position of manufacturers is almost ruinous, as a profit upon production is rendered impossible from the high rates current for the raw material; and so hopeless seems the prospect of relief by a real improvement in the demand that shorttime working is universally admitted to be the only means of bettering their condition, an alternative never necessary in ordinary times, and only resorted to at the last extremity.

Question: If the trade is an unsound one, why are the returns not only kept up, but increased? The answer is: Chiefly for financial purposes. There being no healthy demand for consumption, the new and increased exports are for the purpose of providing for previous engagements falling due. A good portion of the trade is also contributed by producers, who, being unable to find a market for the whole of their production, and being too poor to hold, consign the remainder, upon which they are accommodated with partial advances through the commission agent or intermediate man, who knows that someone must suffer, and provides on the contingency not falling upon himself.|


The Money Market Review, 21. November 1868. S. 479.
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Import of Corn.

The Board of Trade now add to their usual monthly return a table showing the quantity of corn and wheat flower imported into the U. Kingdom between harvest and harvest, viz. in the 12 months, from 1st September to 31st August.

Import in 12 months ending 31st August 1866 equal to qrs 16,365,738: = (62,881,908 cwts.)
31st August 1867 qrs 16,423,923 = (63,186,726 cwts.)
31 August 1868 qrs 16,904,737 = (66,241,042 cwts)
31 August 1868 thus constituted. 36,333,087 cwts of wheat = 8,384,559 qrs.
3,149,815 cwts of wheat flower = 908,601 qrs.
5,583,086 cwts of barley = 1,563,264 qrs.
8,584,365 cwts of oats = 3,121,587 qrs.
999,118 cwts of peas = 222,026 qrs.
2,289,655 cwts of beans = 534,253 qrs.
9,301,916 cwts of Indian corn = 2,170,447 qrs.
Import of Wheat was:
Year ending 31 August 1866: 24,926,789 cwts = 5,752,336 qrs.
31 August 1867: 28,658,336 cwts = 6,613,541 qrs.
31 August 1868: 36,333,087 cwts = 8,384,559 qrs.
The Money Market Review, 21. November 1868. S. 468/469.
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The Foreign Settlements on the London Stock Exchange.

Twice a month a settlement of the previous fortnight is made upon the Stock Exchange. On those days securities to the nominal value of at least 40 millions are handed about. „Handed about“ is indeed to too mild a term to describe the treatment to which, in the pressure of an „account“, the property represented by foreign bonds is subjected. The whole settlement has to be „got through“ before half past 2 in the afternoon. By Stock Exchange law a buyer is bound to pay for all bonds delivered to him up to that time, and when the half-hour has struck the seller can make no further claim for payment during the day.

 Zusatz von Marx.
Money Market Review citirt Pamphlet (1868) eines Stockbroker’s über diesen diabolischen settling day:

„The enormous increase in the number of foreign loans recently negotiated or introduced in this country, and the small denomination of the bonds into which it is the modern practice to divide them, have multiplied the inconvenience and risk attending the present mode of settlement to so great an extent that it is believed no time should be lost in devising an adequate remedy. At present, after the clerks have reduced the account as much as possible in the limited space they have at their disposal, the balances remaining open are settled by delivery from A to B, from B to C, and so on, till the ultimate buyer is reached, so that the same bond frequently passes through 30, 40, or even 50 hands. To prove that this is no exaggeration we have only to look in busy times at the names on the back of a ticket in Consols, or in any of the principal Railways. These will be found frequently with 50 names on them. One result is that transactions, which could probably be adjusted by the passing of cheques to the amount of perhaps 2 or 3 millions £, involve now settlements to the average amount of 13 millions, as the figures of the Clearing House show. This value of 13 millions, however, represents but a portion of the total values passed under the present system; each of the leading jobbers’ office is, in itself, a small clearing house; a large delivery of Turks, f.e., made to him on the one hand, might and is often compensated, by a counter delivery of Italians on the other side. It is impossible to arrive at the amount of stock actually passed on the settling day, but the experience of the writer’s own office shows that the nominal amount of stock passed exceed exceeds, by 3 or 4 ×, the cash balances adjusted.“

The hurry and confusion which attach to this system are therefore due to the fact that all bargains are adjusted between each actual buyer and seller, although the same bonds may have changed ownership many times during the „account“. Common sense would suggest that this cumberous plan might be obviated, as is done in the transfer of registered securities, by placing the original seller and the ultimate buyer in immediate communication. But in the Stock Exchange, as in all other businesses, the credit of individuals differs largely, and the broker who deals readily with one firm in £100,000 stock might be chary of dealing with others in £100. Brokers who transact large operations naturally object, therefore, to forego the security they have in dealing with first class firms, and do not care to accept payment instead from individuals of whose standing they are ignorant. This difficulty might be avoided by adopting the ordinary course of procedure in bill transactions – viz, rendering each endorser personally liable. Such rule once established, the first broker on the Stock Exchange could have no objection to accept the „name“ or „ticket“ of any member, knowing that in case of default of the ultimate buyer, he would have immediate redress from the parties to whom he originally sold, and with whose endorsements he accepted the ticket.|


  • 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.