| Author(s) | Friedrich Engels |
|---|---|
| Written | 15 November 1857 |
ENGELS TO MARX
IN LONDON
Manchester, 15 November 1857
Dear Marx,
I'm sorry about your waiting for me last Monday—I didn't arrive at Euston Square until after 6, THANKS TO BAD ARRANGEMENTS OF THE RAILWAY COMPANY IN BRIGHTON, and travelled on to Manchester the same evening.
I'm in good health and everyone, even Heckscher, is surprised that I should have recovered so well. My memory is still poor, the DULLNESS persists to some extent, and alcohol no longer agrees with me. My last sore is healing up beautifully, a process which riding and a reduction of work at the office cannot fail to help; as to the latter I have agreed with our factory to put myself on SHORT TIME.
You should have 'Cannon'[1] for certain by next Friday's post. It can't be done before that and will amount to about 10 full sheets. The rest of C ought to follow shortly; most of it is trifling stuff which can be done quickly with the books I have here.
As soon as I can see daylight in my financial affairs (now in great confusion) I shall send you some money.
This time the crisis is developing in rather a curious way. For almost a year now, speculative share dealings in France and Germany have been in a state of what might be described as pre-crisis; only now, with the collapse of the main speculative share dealings in New York, has everything come to a head. As always, of course, the Yankees have been doing their swindling with foreign capital, but the really remarkable thing is that this time the capital has come predominantly from the Continent. The bureaucrats and rentiers in Germany, who have been eagerly buying up everything provided it was American, will be well and truly bled. Because of the above-mentioned pre-crisis and the few direct points of contact between continental and American stock-exchange swindles, the destructive repercussions of the latter are not immediately making themselves felt. But they soon will.
Speculation has affected not only shares but all raw materials and colonial produce, hence also all manufactured goods where the cost of the raw material is still strongly reflected in the price; hence the closer they are to the raw material and the dearer the raw material, the more they are affected. Yarns more than grey
goods, the latter more than printed or coloured goods, silk goods more than cotton goods. Here, we have had a pre-crisis in silk since August; approximately 20 manufactures have failed for an amount I would hesitate to put at less than £200,000 and of which only 35% to 40% at the most will be recovered. We are in for £6,000, which makes my share £300!!! or, taking the most optimistic view, £180 after payment of dividends. In these circumstances I shall probably have to come to a new agreement with my old man. That is by the way. The crisis in silk continues. The failure of Bennoch, Twentyman & Rigg (competitors of Blank's) has caught 5 silk ribbon manufacturers in Coventry to the tune of £100,000, the biggest sum being £40,000 and the smallest £6,000. In addition T. S. Reed & Co. of Derby, important silk spinners, doublers and manufacturers, became insolvent im- mediately after, and in consequence of, Bennoch's failure. In Glasgow a whole crowd of small and medium firms, besides those mentioned in the papers, have come a cropper without eliciting the least comment or inquiry. Whether the Maison Ernst Dronke is among them I don't know. Maybe he didn't have the sense to take advantage of the moment to make an honourable exit.
The enclosed chart,[2] which I have prepared from official printed reports supplied by our broker, will show you how the cotton market has fared this year. Whenever the horizontal black line passes between two of the eighths this means that the price was midway between, or Vi6th, thus e.g. between 73/sd and 71/i'd means 77/i6d.
As far as industrial production itself is concerned, America's excess stocks would seem to be mainly in the west; from all I hear, stocks of manufactured goods in the eastern ports are very low. But that these are already A DRUG ON THE MARKET is borne out by the return of entire shipments from New York to Liverpool. 3'U of the local spinners are making for stock and only V4 at the most have orders on their books. SHORT TIME pretty well general. A very active yarn commission house here, which 3 weeks ago had contracts worth £45,000, now has only £3,000 worth, so quickly have the spinners been able to deliver, despite SHORT TIME.
The peculiarly favourable advices from Madras and Bombay (sales with profit, which has not been the case since 1847) have revived the Indian trade. Everyone who possibly can is rushing into it. To the annoyance of the other commission houses, S. Mendel, INDIAN agent, has the whole of his big WAREHOUSE lit up
until 10 o'clock every night and sends out stuff for all he's worth. No DOUBT hundreds of spinners and weavers are shipping goods there on consignment. So we have a reserve crisis up our sleeve there in case this first impact proves incapable of overturning the old muck.[3]
The general appearance of the Exchange here was truly delightful last week. The fellows are utterly infuriated by my sudden and inexplicable onset of high spirits. INDEED, the Exchange is the one place where my current DULLNESS is transformed into resilience and BOUNCING. On top of that my predictions are, of course, always gloomy, which makes the asses doubly furious. On Thursday the situation was at its most dismal, on Friday the gentlemen were mulling over the possible effects of the suspension of the Bank Act132 and, with COTTON rising another Id., word went round that the worst was over. By yesterday, however, the most delectable DESPONDENCY again prevailed; all the hosannas had been so much hot air and, since hardly anyone wanted to buy, the market here remained as bad as ever.
What promises this crisis a brilliant future is the immediate necessity of suspending the Bank Act at the first impact. The direct effect of this will be to land the Bank itself in Queer Street. In 1847 it was still possible to let things drag on as they had done since 1845, and not to resort to this measure until the very last and grimmest moment.
The extension and prolongation of the crisis are also assured. The combination of SHORT TIME and the silk crisis, which latter has already deprived the vast mass of the silk (HAND-LOOM) weavers of their livelihood, will of itself suffice to ruin the HOME TRADE completely this winter—up till the end of October it was still doing well. The American crisis is playing havoc with the Barmen and Elberfeld SMALLWARE MANUFACTURERS, the Elberfeld, Krefeld and Lyons silk manufacturers and the German, French and Belgian cloth manufacturers. The SMALLWARE MANUFACTURERS of Barmen are suffering particularly also due to Bennoch and Twentyman, while Draper, Pietroni & Co. are causing difficulties in Italy, especially Milan, the Duchies,[4] Bologna, etc.
Unless cotton comes down to 6d per pound even a momentary revival of the cotton industry here is out of the question. And at present it is still as high as 7 to 7 'Ad. From this you will see how remote here is the prospect of any change in the state of affairs. Nevertheless a momentary change in the spring is possible and,
indeed, probable. Not that this will mean 'good business', but rather that business can again be done so that the machinery of trade keeps turning and doesn't rust up. Never before has any crisis exhausted itself so rapidly and abruptly, and this one, coming after 10 years of prosperity and speculation, is least apt to do so. Nor is there another Australia or California to come to the rescue, while China will be in the doldrums for the next 20 years.[5] However the violence of this initial blow shows what colossal dimensions the thing is assuming. And in view of the recent enormous output of gold and the correspondingly vast expansion of industry, it could not be otherwise.
We can only hope that this 'improvement' in the crisis from the acute to the chronic stage sets in before a second and really decisive blow falls. A period of chronic pressure is needed to get the people's blood up. The proletariat will then fight better, with better connaissance de cause[6] and in greater unison, just as a cavalry attack succeeds much better if the horses have to cover the first 500 paces at the trot before arriving within charging distance of the enemy. I shouldn't care for anything to happen prematurely before Europe as a whole has been affected; the subsequent struggle would be harder, more tedious and fluctuating. Even May or June would be somewhat too early. The long period of prosperity is bound to have made the masses damned lethargic. However, sight drafts for a revolution will now be presented to us by our friends Kinkel & Co. for payment; that is to be expected, but NEVER MIND, we shall honour them soon enough, as these gentlemen will see.
It's capital that you should be collecting material on this crisis. I am sending you another 2 Guardians today. You shall have it regularly, and the Examiner and Times too now and again. I shall also advise you as frequently as possible of everything I learn so that we have a good STOCK OF FACTS.
I must say I feel just as you do. When the bubble burst in New York I grew very restless in Jersey and in the midst of this GENERAL DOWNBREAK I fell tremendously cheerful. The bourgeois filth of the last seven years has undoubtedly clung to me to some extent; now it will be washed away and I shall become a changed man. Physically, the crisis will do me as much good as a bathe in the sea; I can sense it already. In 1848 we were saying: Now our time is coming, and so IN A CERTAIN SENSE it was, but this time it is coming properly; now it's a case of do or die. This will at once give a more
practical slant to my military studies. I shall apply myself without delay to the existing organisation and elementary tactics of the Prussian, Austrian, Bavarian and French armies, and apart from that confine my activities to riding, i.e. fox-hunting, which is the best school of all.
My kindest regards to your wife and children. They, too, will be in high spirits despite your bad luck. Day and night I worry over my inability to get you out of it.
Your
F. E.
In Failsworth, 4 miles from here, a manufacturer by the name of Liddle was yesterday hanged in effigy optima forma[7] while a weaver dressed as a parson read the BURIAL SERVICE. In place of the words 'MAY THE LORD HAVE MERCY UPON YOUR SOUL' he read: 'MAY THE LORD BLAST YOUR SOUL'.—Now is THE TIME FOR JONES, if only he knows how to make use of it.