(being a great cotton-spinner, and employing also a large sum of money in temporary investments), who, in answer to the remark that cotton-spinning was bad, said Yes; but lending money on railway shares is good.'

On the whole, we think no one will be disposed to deny that this saving class does accumulate during and after panic at a very rapid rate; and that their accumulations do press and must press on the rate of interest. The first assault is usually made on Consols; they are beset on every side, and must rise in price. Consols contain within themselves no principle of expansion, and though Chancellors of the Exchequer have done as much to expand them as could reasonably be expected after thirty years of peace, by dint of twenty millions for the Negroes, and eight for the Irish, and two or three at different times for Whig deficiencies; still Consols are a fixed quantity. When a sale of them takes place, as much comes out as goes in, and the pressure on the rate of interest is not relieved. Then there is the money of the irresolute, who cannot forget that Consols have been at par and below 80 within a short period, and will not touch them. Their money falls, for the time, into the hands of the dealers, and its first effect is to stimulate trade. Mr. A.,' says the discount-broker, you were naming, a short time back, some long-dated bills. The state of the market did not permit our touching them at that time, but we should be happy to see you now.' And so Mr. A., getting his long bills discounted at a rate which, when tested by the prices current, appears likely to leave a profit, enters into some adventure which he would otherwise have let alone. But even to this there is a natural limit. Draw and discount as you will, you can but effect the exchange of all the goods which exist; and recent events in corn and cotton have shown us how nearly consumption treads on production. Meanwhile, the exaggerated prudence produced by the last crisis has lasted six or seven years. Accumulation has gone on; the earth has yielded its average produce; manufacturing and mercantile industry have provided for their own extension. There is no use in continuing to knock at the door of the discount-houses, or of Consols, Exchequer-bills, or mortgages. You may, indeed, drive up the price till you have little more than the honour of possessing the security; but, invest as much as you will in these securities, there is no less unemployed money, there is no more interest to be paid. If more interest must be paid, more money must be employed in some way which will yield it. Willing or unwilling, directly or indirectly, you must-we should say speculate, if it had not pleased Chancellors of the Exchequer to make that word disreputable. We will say, as less offensive, that you

must

must enterprise. You must drain morasses, or subdue wilds, or embank estuaries, or cut through isthmuses, or make some new work, or improve some old one, in a manner which will give a return on the money expended.

There is indeed one other plan. You may invest your money so that you shall never see the principal again nor any interest. This is unsatisfactory to those who happen to be engaged in the transaction, but it is a great relief to the market. We have availed ourselves of it pretty extensively in each of the three last great gluts of money-in the two first spontaneously, in the third by compulsion. It is managed in various ways. You may lend to people who spend the money in cutting one another's throats, and therefore cannot pay you the Spaniards for instance, and their descendants in the Old World and in the New: this we did in 1825. You may expend money on mines, abroad or at home, which do not exist, or which will not return the expenses of working for this also we may quote the year 1825; and if any gentleman will turn back to a share-list of Christmas 1826-7, he will find many other instances which tell the same story. You may, like the Canon of St. Paul's, of facetious memory, lend to people who can pay, but will not. The money may be laid out productively-but not to you. The present effect is the same, and the market is relieved. You may make Thames Tunnels, or useless buildings, or useful ones too expensively. The Government may come to your aid. It is exactly the same whether they dissipate or you; if they did not dissipate they would save, and would be increasing the pressure by redeeming Consols at par. But instead of this they may make Caledonian Canals, or Shannon Navigations; they may take the Ordnanceoffice to their counsels, and fortify all the world. A million went very soon at Vido, and untold millions-we shall probably never know the amount-on the line of lakes and canals in Canada, at St. Hellier, Ascension, and many other places, known only to the Royal Engineers. For the unnamed private follies of that crisis we must refer our readers to the share-lists from 1835 to 1837.

Then comes the third and last glut of money, in which, as far as investments without return are concerned, the famine of 1845-6 represents the follies of 1825-6 and those of 1835-6. Whatever we paid for food, to make up for the deficiency in our own average produce, was money paid for which we shall have no pecuniary return present or future. We will only name one other mode of dissipating money, which was peculiar to the last hot fit. We not only surveyed, planned, and sectioned, and deposited at the Board of Trade, and at many other places, every possible and every impossible line in England, Scotland, and

Ireland,

Ireland, but we took a good wide range over the rest of the world. We kept an army of martyrs (in the etymological sense of the word) who sustained, from 11 in the morning to 4 in the afternoon, for five days in the week, from February to August, a constant ascending and descending stream up the wide staircases which lead to the New Committee Rooms of the Lords and Commons; besides filling with a crowd, which a weak man elbowed through with difficulty, every passage, avenue, lobby, hole, and corner in the neighbourhood. Engineers, surveyors, attorneys' clerks, traffic-takers, notice-servers, &c. &c., waited for ten days together to be examined, and then, after half an hour of examination, waited for five or six more to see whether they were to be recalled; daily retired at four o'clock to Henderson's Hotel, the Union,' or the Hummums,' to recruit the body with very unwonted delicacies; and then relieved the tedium of so monotonous a life at the French Play, or perhaps the Hall of Rome.' We are not speaking of expenses which attach to any Railway bill which has passed, to any Railway which is made, is making, or is ever likely to be made. We speak of the money which was spent on Railway bills which were defeated or withdrawn, and have not reappeared. To this expenditure we can approximate by a calculation which must be considerably under the mark. In the year 1845 alone (see paper 208, Feb. 1846) 14,654,8177. was paid in under the 10 per cent. standing order. We certainly shall not be over the mark if we say that one-half of this money was paid in by lines which have disappeared. In them will be included the competing lines rejected sometimes two or three in one group, the independent lines rejected on standing orders or on merits, and all lines merged, bought off, and withdrawn. Surely we shall not err if we say that the depositors on these defeated lines did not receive back more than one-half of their deposits we fear 6s. or 7s. in the pound would be nearer the mark. But take it at one-half; then we have 3,663,7047. as the money spent and irrevocably gone on Railways in the year 1845 alone. And how much must this be within the mark! It includes no line withdrawn before paying the 10 per cent.; it includes no defeated branch of an old line, because they always evaded the 10 per cent. by saddling the new scheme on some power of raising money previously obtained. It includes no defeated nor annihilated water-works, gas-works, docks, piers, and harbours; they were not subject to the 10 per cent. clause. Then there is nothing for what was fruitlessly spent abroad. When we say that millions have been spent and lost, we do not mean that a set of men have bought shares and have sold them

for

for so much less money; we mean that the money has been spent, and tried to be converted into fixed capital—and there is nothing-nothing more reproductive than a Poyais bond, a Thames Tunnel, a Caledonian Canal, or the plan and section of a railway in the Sierra Morena.

We have thus suggested some of the main heads under which money was dissipated in each of the three crises: not because we consider this as the main feature in the case, but because it has indisputable and very considerable weight, and because in disputations on our pecuniary difficulties we have seldom seen money spent recognised as of much importance, and money lost, never. It is always something wrong with the currency, or over-trading, or over-production, or want of confidence.

'Folks don't pay,' said the dog's-meat man,

'And I'll tell you the reason why;

Tis 'cos they've paid as long as they can;

They've drawn the cash, and the tap is dry :'

It is all the bill of But no one, except the

and so said many a trader besides. Money 's scarce! Why? It is all the Bank of England,' say Sir W. Clay, Mr. Jones Loyd, and their disciples, who seem to think that, by some clever management of the Bank, we might spend our money without perceiving that it was gone. It's all the bill of 1819,' say Messrs. Muntz, Spooner, and Newdigate. 1844,' say the Chambers of Commerce. Times newspaper and the Dog's-meat man, thinks of saying money is scarce because we have spent it-part of it so that we cannot get it back in a hurry, and part of it so that we shall never get it back at all-gone from us and our heirs for ever as much as if it were gone beyond Jericho to the bottom of the Dead Sea.

We have already stated that dealings in existing unexpensive securities, paying a definite amount of interest (say twenty millions, or any other sum), are mere transfers of the securities to the parties who at the moment are willing to pay most for the right to receive that interest. A. has 1507. of loose money, and B. has a transferable claim to receive 31. per annum. A. in his extremity gives B. 150l. for the 31. per annum; then B. has 1507. of loose money. No difficulty is solved; there is but 37. per annum between them. If they must have more they must make it by enterprise, adventure, or speculation. John Bull, when he has money, is a careful and rather timid animal, and, to a certain point, long-suffering. It is said, that when a lion is gorged with food, a child may play with him. But no one doubts the fate of the child if the lion's next meal be omitted or curtailed. Give John good interest, paid half-yearly, and, though never contented, he is very quiescent. For many years he was

taught

taught by law that the interest of money was 5 per cent.; and even after the law was changed he felt rather ashamed of himself when he took more; though we dare say that feeling is now wearing off. Under the influence of prudence, generated by alarm, he submits to 4 per cent. quietly; with much grumbling he may tolerate 3 per cent.; but at 2 per cent. his inmost soul revolts. In fact, every wild speculation in England has begun by John's rebellion against 2 per cent. Then his native spirit of enterprise, which has only been in abeyance, revives. Some one brings forward a new scheme, or resuscitates an old one; canals, waterworks, docks, gas, each in its turn: but we will take our illustration from the great absorbing investment of the present day-Railways. An inventive genius proposes to lay a road with parallel lines of iron-by no means a novel proposition; but his road surpassed, both in its plan and in its execution, anything which had before been attempted. As the work approached completion, slowly and cautiously he announced that he intended to convey passengers by locomotive steam. Eight miles an hour was talked of, but twenty was intended and immediately attained. This Liverpool and Manchester Railway originated in the hot fit of 1823-4, and was completed by 1830. The success was indisputable; but the nation, smarting from 1825-6, was cautious. Storms of opposition rose on every side-canal-owners, reasonably alarmed for the value of their property; county-towns, which imagined that their prosperity depended on the travelling chariots that rolled through their streets; posting and coach masters, whose existence seemed to be at stake; every carrier, from Pickford and Co. to Jacques the higgler, who travelled twice a-week from Hitchen to London with butter and eggs. Every publican was alarmed; country gentlemen declared that their lands, and fox-hunters that their sport, would be ruined: every prophet from Isaiah to Malachi predicted evil. If we repeated their prophecies we should seem to those who do not remember the period to be romancing. They extended from the ruin of the wayside inn to the setting of the sun of Britannia, never to rise again; which last was to be thus effected: that every nobleman and gentleman would desert the country, which would be left to radicals, navvies, engineers, and manufacturers. No wonder the Legislature was cautious. But the accumulation of money and the continued fall of the rate of interest allayed the fears, answered the arguments, and set at nought the prophecies. Before interest had fallen to its lowest point in 1835, the London and Birmingham, the Grand Junction, all the Midlands, the Derby and Birmingham, and several short lines in the manufacturing districts, had obtained the sanction of the Legislature,

and