2S Ira Ryner 



CRISIS OF 1847 



In England previous to the crisis of 1847, on account of un- 

 favorable exchanges, gold began to be exported June, 1845, ^^^ 

 up to November of the same year the Bank had lost two and a 

 half millions of bullion. But from the latter date until March 

 of the following year, 1846, the movement' was reversed, and 

 during the whole year gold returned to England. 



At the beginning of the year 1847, however, gold began to 

 flow out again, and this movement continued throughout the 

 whole year. By the 24th of April the reserve -had fallen to a 

 trifle over nine millions. The complete failure of the potato 

 crop in Ireland and the deficient harvests had necessitated an 

 increase in imports which were being paid for in gold.^ Again 

 in 1847 the cotton crop was poor and the grain supply deficient. 

 Coupled with this demand for gold was the additional demand 

 for assistance granted the Bank of France. To check this efflux 

 of gold the bank rate was constantly raised until in October, 

 1847, it stood at 8 per cent. From this time on, the panic be- 

 ing over, gold rapidly returned. 



In France, for several years preceding the crisis, exports were 

 declining while imports were increasing; and at the same time 

 there was a slight excess of imports of the precious metals. The 

 trade balance phenomenon was much the same for France in 

 1847 as for the United States in 1837.^ 



In the United States a contrary movement from that taking 

 place in France was to be observed. We were supplying the 

 deficiency in the European grain crop, which caused our total 

 exports to jump suddenly from $109,000,000 in 1846 to $156,- 

 000,000 in 1847. At the same time our imports of gold were 

 increasing rapidly. From 1845 to 1847 while our exports of 

 precious metals declined from $8,000,000 to $1,000,000, our im- 

 ports increased from $4,000,000 to $24,000,000. For the next 

 year, however, the situation was exactly reversed.^ 



^ Crump, The Key to the London Money Market. 31. 

 ^Monthly Summary of Commerce and Finance, February, 1903. 

 *Ibid. , 



170 . 



