Revival of Business.

During the year 1838 there had been a general revival of trade. The Bank of England rate was from 2½ to 3½ per cent. During the whole of that year. This led to increased investments in American securities. “ Bonds of all kinds issued by the Bank of the United States, by the various States in the Union, and by numerous private undertakings, were poured upon the English market, and found eager purchasers.” This served as a further extension of credit on American debts carried over by the operations of the Bank of the United States and others from the previous crisis. It is important, as showing that besides the strenuous efforts made by Americans to pay (a fact to which there is the best testimony), and the amount lost in bankruptcy, the time for liquidating the debts of America to Europe was greatly extended.

Towards the end of the year there were symptoms of further trouble. The exchanges became adverse, and the stock of gold in the Bank of England declined until October. In that month the Bank had,£2,525,000 in bullion notes, £17,612,000; and deposits £6,734,000. In May the rate was 5 per cent.; June 20, 5½; August 1, 6; September, 6½. In the autumn the Bank of Belgium failed, and there was a run on the banks at Paris. The Bank of England borrowed £2,500,000 of the Bank of France through Barings. After October gold began to flow into England, and the pressure subsided.

These incidents again reacted on this country. The suspension had not been followed by any great reduction of paper here, but had rather enabled the banks to go on without reducing; only at New York, where they were most exposed to the action of an adverse exchange, and where the legislature had taken prompt measures of compulsion, was there a thorough reduction.