1825

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The Panic of 1825 and 1987

It is December of 1825. After the Panic of 1819 in America, the Bank of England loosened its policy on lending money to country banks outside of London. This policy propped up the British pound. Oddly, this easy money policy in England encouraged the same lending behavior that caused the Panic of 1819. Now there is a run on the banks after several prominent British banks close their doors. In all, 70 banks collapse. The Bank of England, the "lender of last resort" has refused to lend money as a last resort! The financial community calls on the government to lend money from the Treasury, but that would take an Act of Parliament and they are in recess for Christmas. The Bank of England's reserves are dwindling fast. By next March they will have lost several million pounds in assets. Someone must do something and if government will not act, the Bank of England must. So they do. To the modern mind, this will seem obvious, but they lend money based on the value of goods rather than limiting lending to assets of gold and silver. England is saved... without government intervention. [1] [2] [3]

My Take by Alex Shrugged
In 1987, stock markets across the world collapsed. It was called Black Monday. The Dow Jones average dropped 508 points. As a percentage of the Dow Jones, it remains the largest single-day drop in history. The American financial community demanded that President Reagan DO SOMETHING! Every President chooses a past President to model himself after, and President Reagan chose Calvin Coolidge. Not only did "Silent Cal" say that "the business of America is business," but he also said that "if you see ten troubles coming down the road, you can be sure that nine will run into the ditch before they reach you..." In other words, if you are patient, most problems will fix themselves. President Reagan refused to "fix" the stock market, so the private sector was on its own. The Fed did nothing and encouraged banks to do nothing but normal lending at the normal rates. The banks absorbed the losses, but the real value was the calming effect of normalcy. By doing nothing, people took the time to think rather than panic. Eventually computer trading was blamed, and "speed bumps" were put in place, but that really wasn't the problem. It was a series of events mostly having to do with oil futures and a stock market in serious need of a correction. [4]

The Search for High-Speed Communication

At this point Samuel Morse is best known for his talent as an artist. He completes his painting of Lafayette this year to take advantage of the interest in Lafayette as he tours across America remembering the good old days. Morse starts on yet another work when he receives an urgent message from his father. Apparently Morse's wife is ill. Then he receives another message, shortly thereafter. His wife is dead! By the time Morse reaches home, his wife has been buried and the funeral is long over. He is naturally upset and wonders why there isn't a faster way to communicate a quick, simple message over long distances. [5] [6]

My Take by Alex Shrugged
France already had a mechanical semaphore system at the time, but in 1832, Samuel Morse met a man who understood the mysteries of electromagnetism and by 1838 the first telegraph message was sent using the Morse Code system. By 1851, Morse Code was the accepted standard across Europe and a survey was begun to explore the feasibility of laying a telegraph line across the Atlantic Ocean. In fact, the War of 1812 might never have happened if the US Congress had realized that the English Parliament was voting to discontinue shanghaiing American sailors. The US vote to go to war occurred almost simultaneously with Britain's vote to take the US grievance seriously. [7]

A Quiet End to a 470 Year Riot

In 1355 a tavern brawl turned into a riot between the students of Oxford and the townspeople. It was called the Saint Scholastica Day riot and after the King of England sided with the students, a new charter was drawn up to define the relationship between Oxford University and the town. The Mayor was compelled to pay 5 shillings and 3 pennies per dead student each year and swear allegiance to the Chancellor in an annual ceremony. It may seem like a quaint tradition, but the implied insult is too much to take. After almost 470 years, the Mayor refuses to pay. That is the end of it, but Oxford University representatives will remain on the city council until 1974. [8] [9] [10] [11] [12]

My Take by Alex Shrugged
In many college towns the local college will takes precedence and the townspeople often resent it. After all, the student population is young, transitory and often disruptive, but the local residents want long-term stability and order. I live near Austin, Texas which is a college town. I'm not exactly a fuddy-duddy, but I would like to live through another day. As I was driving along the street, a truck filled with drunken college students barreled down the road going the wrong way and coming right at me. They missed. I am a forgiving man, especially with drunks, but they scared the living snot out of me. They were headed toward the police station. I hope they made it.

In Other News

  • Baseball, is played once a week now. Details are vague, but it is gaining in popularity. [13] [14]
  • Aluminum is produce for the first time. It is derived from aluminum chloride. [15]
  • The US Postal Service creates the Dead Letter Office. Years later this office will verify that Santa Claus actually exists! Or maybe that was a movie. [16] [17]

This Year on Wikipedia

Year 1825, Wikipedia.

See Also

References

  1. Fetter, Frank W. (February 1967). "Historical Confusion in Bagehot's Lombard Street, A". Economica, New Series (Wiley on behalf of The London School of Economics and Political Science and The Suntory and Toyota International Centres for Economics and Related Disciplines) 34 (133): 80-83. http://www.jstor.org/stable/2552518. Retrieved 12 July 2016. 
  2. {cite journal | title = The Laws of the Currency, as Exemplified in the Circulation of Country Bank Notes in England, since the Passing of the Act of 1844 | author = Gilbart, J. W. | journal = Journal of the Statistical Society of London | volume = 17 | issue = 4 | date = December 1854 | pages = 289-321 | publisher = Wiley for the Royal Statistical Society | url = http://www.austinlibrary.com:2138/stable/2338289 }}
  3. Peterson, Arthur G. (April 1933). "Futures Trading with Particular Reference to Agricultural Commodities". Agricultural History (Agricultural History Society) 7 (2): 68-80. http://www.austinlibrary.com:2138/stable/3739680. 
  4. Calvin Coolidge - Wikiquote. en.wikiquote.org (2016). Retrieved on 12 July 2016. “Mr. Hoover, if you see ten troubles coming down the road, you can be sure that nine will run into the ditch before they reach you and you have to battle with only one of them. -- As recounted by Herbert Hoover ; from Coolidge: An American Enigma, Robert Sobel, Regnery Publishing (2000), p. 242”
  5. Samuel Morse - Wikipedia (2016). Retrieved on 19 May 2016. “As noted, in 1825 New York City had commissioned Morse to paint a portrait of Lafayette in Washington, DC. While Morse was painting, a horse messenger delivered a letter from his father that read, 'Your dear wife is convalescent'. The next day he received a letter from his father detailing his wife's sudden death. Morse immediately left Washington for his home at New Haven, leaving the portrait of Lafayette unfinished. By the time he arrived, his wife had already been buried. Heartbroken that for days he was unaware of his wife's failing health and her death, he decided to explore a means of rapid long distance communication. While returning by ship from Europe in 1832, Morse encountered Charles Thomas Jackson of Boston, a man who was well schooled in electromagnetism. Witnessing various experiments with Jackson's electromagnet, Morse developed the concept of a single-wire telegraph. He set aside his painting, The Gallery of the Louvre. The original Morse telegraph, submitted with his patent application, is part of the collections of the National Museum of American History at the Smithsonian Institution. In time the Morse code, which he developed, would become the primary language of telegraphy in the world. It is still the standard for rhythmic transmission of data.”
  6. Gilbert du Motier, Marquis de Lafayette - Wikipedia (2016). Retrieved on 12 July 2016. “In 1824, President James Monroe invited Lafayette to the United States as the nation's guest; during the trip, he visited all twenty-four states in the union at the time, meeting a rapturous reception.”
  7. Telegraphy - Wikipedia (2016). Retrieved on 12 July 2016. “The first telegram in the United States was sent by Morse on 11 January 1838, across two miles (3 km) of wire at Speedwell Ironworks near Morristown, New Jersey, although it was only later, in 1844, that he sent the message 'WHAT HATH GOD WROUGHT' from the Capitol in Washington to the old Mt. Clare Depot in Baltimore.”
  8. Tuchman, Barbara Wertheim. (Barbara Tuchman, bio). A Distant Mirror: The Calamitous 14th Century. Ballantine, 1979. pp. 133-134. (BOOK) quote="In 1354 one of the periodic town-gown riots at Oxford exploded in such fury, with the use of swords, daggers, and even bows and arrows, that it ended in a massacre of students and the closing of the university until the King took measures to protect its liberties."
  9. Oxford History (2014). Archived from the original on May 24, 2010. Retrieved on 2014. “The Colleges started in the 13 th Century and developed to become a seat of learning. 1354 marked the first of a series of strained relationships between the University and the town with a riot on St Scholastic's day when students complained about the wine being served to them and Swyndelestock Tavern. The result was that the city had to pay for the repairs to the Colleges and the Mayor had to swear allegiance to the Chancellor which continued until the Victorian era. The University had considerable power over the town until 1974 when it lost its right to place its own representative on the Oxford City Council.”
  10. Town and gown: In the Middle Ages - Wikipedia, 2014 [last update]
  11. St Scholastica Day riot - Wikipedia (2016). Retrieved on 12 July 2016. “The penance ended 470 years later in 1825 when the mayor refused to take part.”
  12. Scholastica - Wikipedia, 2014 [last update]
  13. Grun, Bernard. The Timetables of History: A Horizontal Linkage of People and Events. Simon and Schuster, 388-389. 
  14. History of baseball in the United States - Wikipedia (2016). Retrieved on 12 July 2016. “Another early reference reports that base ball was regularly played on Saturdays in 1823 on the outskirts of New York City in an area that today is Greenwich Village.”
  15. Hans Christian Ørsted - Wikipedia (2016). Retrieved on 12 July 2016. “In 1825, Ørsted made a significant contribution to chemistry by producing aluminium for the first time.”
  16. Miracle on 34th Street (1947). IMDb (1947). Retrieved on 12 July 2016. “When a nice old man who claims to be Santa Claus is institutionalized as insane, a young lawyer decides to defend him by arguing in court that he is the real thing.”
  17. Dead letter office - Wikipedia (2016). Retrieved on 12 July 2016. “The United States Postal Service started a dead letter office in 1825 to deal with undeliverable mail.”

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