24 Ira Ryner 



III 

 Trade Movements 

 crisis of 1836-39 



Having made a study of the permanent environment and occa- 

 sions, it is logically in order for us to treat next of trade move- 

 ments. This appears to be the natural order since, as a rule, out- 

 side of tariff changes, changes in trade movements result from 

 the operation of causes and occasions, as we have defined them. 



To establish the truth of this assertion, let us take the case of 

 England where, preceding the crisis, extensive improvements in 

 manufacturing machinery made it possible to 'turn out cotton 

 goods at greatly reduced prices. This of course stimulated the 

 demand for raw cotton, resulting in an increased export of that 

 article from the United -States. To trace the efifect farther, the 

 increased trade extended the cotton area, boomed southern cities, 

 encouraged the extension of the railway system, and so on. 



Other industries, however, were undoubtedly affected unfa- 

 vorably by these changes, since increased activity in cotton must 

 have necessitated a withdrawal of capital from other industries, 

 or increased loans, or both. Thus we see a change in one branch 

 of industry may pass an impulse to another -branch, the disturb- 

 ance in this branch affecting another, and so on until the current 

 of impulse has pervaded the whole industrial system. Neverthe- 

 less, although 'the increased export of cotton resulted in an ex- 

 tension of the cotton area, the real cause was the improvement 

 of manufacturing machinery in England. Or we may go even 

 farther back and say that high wages or some other causes ren- 

 dered indispensable the improvement of machinery. So in gen- 

 eral we may say that, although trade movements are indicative 

 of the operation of causes and occasions, yet they are themselves 

 not causes but results. 



In England during the period from 1830 to 1837 the principal 

 merchandise movement was in exports. The imports continued 

 to increase at a constant rate, rising from $225,000,000 to $266,- 

 000,000. The exports on the other hand almost doubled in 



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