nsumption the articles
intended for it, just when they are most needed. Speculation forces
prices still higher, by inspiring others to purchase, and appropriating
new importations at once. All this is reported to England, manufacturers
begin to produce with a will, new mills are built, every means is
employed to make the most of the favourable moment. Speculation arises
here, too, exerting the same influence as upon foreign markets, raising
prices, withdrawing goods from consumption, spurring manufacture in both
ways to the highest pitch of effort. Then come the daring speculators
working with fictitious capital, living upon credit, ruined if they
cannot speedily sell; they hurl themselves into this universal,
disorderly race for profits, multiply the disorder and haste by their
unbridled passion, which drives prices and production to madness. It is
a frantic struggle, which carries away even the most experienced and
phlegmatic; goods are spun, woven, hammered, as if all mankind were to be
newly equipped, as though two thousand million new consumers had been
discovered in the moon. All at once the shaky speculators abroad, who
must have money, begin to sell, below market price, of course, for their
need is urgent; one sale is followed by others, prices fluctuate,
speculators throw their goods upon the market in terror, the market is
disordered, credit shaken, one house after another stops payments,
bankruptcy follows bankruptcy, and the discovery is made that three times
more goods are on hand or under way than can be consumed. The news
reaches England, where production has been going on at full speed
meanwhile, panic seizes all hands, failures abroad cause others in
England, the panic crushes a number of firms, all reserves are thrown
upon the market here, too, in the moment of anxiety, and the alarm is
still further exaggerated. This is the beginning of the crisis, which
then takes precisely the same course as its predecessor, and gives place
in turn to a season of prosperity. So it goes on
perpetually,--prosperity, crisis, prosperity, crisis, and this perennial
round in which English industry moves is, as has been before observed,
usually completed once in five or six years.

From this it is clear that English manufacture must have, at all times
save the brief periods of highest prosperity, an unemployed reserve army
of workers, in order to be able to produce the masses of goods required
by the market in the