Tuesday, February 7, 2012

Charles Dickens on Finance and Financial Crises

To honor the bicentenary of Dickens birth I had planned to put together a post on Dickens and the commercial crisis of 1857-58 including the failure of the Strahan, Paul & Bates bank. Then I found that someone much, much sharper than I had done it back in 2008.
First a quote:
...The mature young lady is a lady of property. The mature young gentleman is a gentleman of property. He invests his property. He goes, in a condescending amateurish way, into the City, attends meetings of Directors, and has to do with traffic in Shares.
As is well known to the wise in their generation, traffic in Shares is the one thing to have to do with in this world. Have no antecedents, no established character, no cultivation, no ideas, no manners; have Shares.
Have Shares enough to be on Boards of Direction in capital letters, oscillate on mysterious business between London and Paris, and be great. Where does he come from? Shares. Where is he going to? Shares. What are his tastes? Shares. Has he any principles? Shares. What squeezes him into Parliament? Shares.
Perhaps he never of himself achieved success in anything, never originated anything, never produced anything? Sufficient answer to all; Shares. O mighty Shares! To set those blaring images so high, and to cause us smaller vermin, as under the influence of henbane or opium, to cry out, night and day, 'Relieve us of our money, scatter it for us, buy us and sell us, ruin us, only we beseech ye take rank among the powers of the earth, and fatten on us'!
-Charles Dickens, Our Mutual Friend
From NPR:
A Tale Of Two Economies
November 4, 2008
The economic crisis is rattling people's nerves, but imagine living during the time of Charles Dickens, when the Bank of England was on the verge of collapse and financial ruin was sudden. Robert Douglas-Fairhurst, a professor at Oxford University's Magdalen College, talks with Renee Montagne about his article comparing today's financial crisis with the economic downturn when Dickens was a boy.

We're going to spend the next few minutes contemplating financial ruin. Not our own for a change, but that in the world of Charles Dickens. His was a time in the 19th century that the Bank of England nearly went under. One could lose everything suddenly and totally, and a young boy like Oliver Twist could find himself on the street working for an unsavory character like the pickpocket Fagin.
(Soundbite of song "You've Got to Pick a Pocket or Two")

Mr. RON MOODY: (As Fagin) (Singing) In this life, one thing counts. In the bank, large amounts. I'm afraid these don't grow on trees. You've got to pick a pocket or two.

MONTAGNE: Whether it was "Oliver" or "Little Dorrit" or "Christmas Carol," hard times permeated Dickens' work. Robert Douglas-Fairhurst is a professor at Oxford University's Magdalen College. He's written about the parallels between the current financial crises and those in 19th century England that began when Charles Dickens was a boy.
Dr. ROBERT DOUGLAS-FAIRHURST (Professor of English, Magdalen College, Oxford University): 1825, that's when the Bank of England realized that it had been handing out lots of money to speculative investments, often in overseas projects that would never get off the drawing board. Its reserves were gradually dwindling. It was down to its last three million. And it withdrew all the loans, which meant that almost overnight, 500 companies went bankrupt. And you see echoes of that in Dickens' writing. "Nicholas Nickleby" has Mrs. Nickleby telling her husband that they should speculate with all their assets. And what happens is the bubble bursts....MORE
Here's Professor Douglas Fairhurst's article for The Telegraph, Oct. 21, 2008:
Financial crisis: We should turn to Charles Dickens in hard times, not just Little Dorrit

And here is the Harvard University Press' webpage for Douglas-Fairhurst's "Becoming Dickens".