World Economic Crisis
The financial and economic crisis of 1857-1858 was the first global crisis. Although he, like previous crises, was most affected by Britain, the main industrial and trading Power, but he started in the United States and hit France and Germany hard.
The nineteenth-century crisis has taken place in stable monetary systems based on gold. Serebro was still a cash metal, but his role was weakened. The United Kingdom of the first major country has adopted a gold standard system. It doesn't mean the money was golden coins. On the contrary, their share in the cash mass was rather declining and the share of bank money - bank notes and current accounts in banks - increased. However, bank money was changed to nominal gold, which was ultimately provided with the gold reserve of the central bank. In England, and then in other countries, laws have been enacted to establish binding rules for the collection of gold deposits.
Inflationary paper money was diverted to the periphery of the then world or used in special cases such as the Civil War of 1861-1865 in the United States.
The 1850s were a period of unprecedented gold mining. A large number of metals continued to extract Russia, wealthier deposits in California were opened in 1848 and Australia in 1851. The flow of gold, like fresh blood flowing into the household, originated from these remote areas to Europe and to the US industrial states. The gold fuelled industry growth, railway construction, equity societies and banks. It facilitated the approval and dissemination of the gold standard.
Gold currencies have not ruled out certain price fluctuations that are incompatible, but what happens in paper-based monetary treatment that is not supported by a change in gold banknotes. Prices have generally declined in economic and financial crises, sometimes significantly. In the 1857-1858 crisis, the U.S. wholesale price index (monthly data) fell by 16 per cent and the Agricultural Price Index by 20 per cent.
Price fall was a symptom and an integral part of the crisis. Enterprises ' accumulated stocks were depreciated, they had to sell their products for loss, which made it impossible for firms to repay credits at a better time, and pushed them to bankruptcy.