Chapter 435

War is not a child's play, and finding a pretext for war can be ignored, but mobilizing troops and raising strategic materials are still indispensable.

Don't look at Egypt's weak chickens, it also depends on who you compare with, at least they are still in charge of the African continent, known as the No. 1 power in Africa.

Their biggest competitor is Ethiopia, but this opponent, the British, helped weaken it, and it will be over when they finish Ethiopia.

There is no doubt that the powers still have to save face. Unless it is a small powerhouse like Afghanistan, or for the sake of face, the British will also crippling Ethiopia.

The hegemon needs to be defended by force. It is okay to lose to the same European powers, but not to the African natives.

The Paris government is still very pragmatic. In order not to make a joke, they prepared carefully. Napoleon III decided that politics and military should go hand in hand, first defeating the Egyptian government and then winning over pro-French people.

This is also a common method used by European countries for overseas colonial expansion, including Austria in Central America, with the exception of the African continent.

In London, the news of the opening of the Suez Canal caused an uproar in the financial market. Many people pessimistically believe that the era of great seafaring is coming to an end.

This is based on the fact that after the opening of the Suez Canal, the voyage of Austria to the Indian Ocean has been shortened by more than 12,000 kilometers, and the voyage of France and Spain to the Indian Ocean has also been shortened by more than 10,000 kilometers.

The British had the least shortened voyages and were at an absolute disadvantage in this regard. In the capital market, domestic companies in the United Kingdom are despised, and the stocks of export companies engaged in the Indian Ocean, Southeast Asia, Southeast Asia and other regions have experienced a cliff-like decline.

This drop has spread to the entire London market. Naturally, upstream and downstream related industries cannot be immune to the situation. Along with the collapse, the stock market crash broke out.

The capitalist world economy affects the whole body. If the stock market crash breaks out, other industries should not be immune to it. The financial industry is the first to be affected.

Since the beginning of 1868, long queues have formed on the streets of London. The stock market crash led to the bankruptcy of speculative financial institutions and banks, which triggered panic among the people, and the run crisis followed.

This is just the beginning. If there is a problem in one link of the circular economy chain, it is bound to involve other links.

There is no doubt that the run crisis broke out, banks stopped lending to protect themselves, and the financial crisis affected enterprises.

The opening of the Suez Canal is only the trigger for the economic crisis. The British economy has long been in trouble. As early as a few years ago, there was overcapacity in the UK.

This is also related to the rise of Fao. The world's market is so large, and there are more competitors to grab the market, resulting in a continuous decline in the international market share of British industrial and commercial products.

If the market is small and production capacity is not cut, there will naturally be excess. Only the American Civil War, followed by the Russian-Prussian War, delayed the crisis.

Now that the war is over, there is no market for the goods produced, and an economic crisis is brewing. At this time, the opening of the Suez Canal happened to detonate the crisis ahead of schedule.

The original time and space began in 1864, and the economic crisis broke out from the United Kingdom. Now that the time has been delayed by three or four years, the overcapacity is naturally more serious.

This is due to the inconvenience of communication and poor market information. The capitalists did not keep pace with the market to adjust production, resulting in severe overcapacity.

Without any new tricks, it is natural to find a way to spend the winter when the economic crisis breaks out. Enterprises without strength go bankrupt directly, and industries with strong strength also begin to lay off employees and reduce production capacity.

In the summer of 1868, the Great Depression hit London. The scale of British railway construction has been reduced by 78%, more than a dozen large and small railway companies have declared bankruptcy, and more than 20 railways under construction have been suspended indefinitely.

The shipbuilding industry also peaked in production in 1867, then began to shrink, and by the end of 1868 the industry had shrunk by 34%.

The textile industry is the hardest hit by this crisis. Affected by the Austrian cotton spinning industry, they lost the market in Central and Eastern Europe, and the Western European market was attacked by the French.

The pillar industry of the British has been hit hard in this economic crisis. Five giant enterprises with more than 100,000 workers went bankrupt in the economic crisis.

Bankrupt people are all over the street. Half a year ago, he was a wealthy man with infinite glory, but now he has become a street refugee.

At the same time, affected by the economic crisis, exports have shrunk sharply. The outflow of gold was serious, funds were tight, banks and enterprises went bankrupt one after another, and the British ushered in the eleventh crisis in economic history - the canal crisis.

After the outbreak of the economic crisis, the British government did not take timely measures to deal with it, but let the crisis run wild and let the crisis get out of control.

Countless unemployed people took to the streets of London to demonstrate, and the capitalists also complained. Opposition parties slammed the government for inaction in the newspapers, and the economic crisis triggered a political crisis.

John Russell's cabinet faces its biggest crisis of confidence since taking office. However, it's really none of their business, under British law the government has no right to interfere in the free economy.

The mouthpiece party doesn't care so much, it's all the government's fault anyway. Fortunately, Prime Minister John Russell did not interfere with the market, otherwise he would be charged with "interfering with the free economy and causing an economic crisis".

Needless to say, when politicians encounter problems that cannot be solved, the most common means is to resign.

...

In Vienna, the sudden economic crisis aroused the attention of Franz. Unless it is a planned economy, overcapacity cannot be avoided at all.

Since there is a problem in the UK, then Austria should not want to be alone, and it will be a problem sooner or later.

Franz asked with concern: "The economic crisis has come again, what measures does the cabinet take?"

Prime Minister Felix replied: "Your Majesty, judging from the situation in the UK, the impact of this economic crisis will be very large.

In order to get out of the crisis, the cabinet decided to let state-owned enterprises start destocking and dumping stocked goods around the world at low prices.

We have to compete with the British and the French for time. The market is so big, and if the response is slow, it will be hit in our hands. "

In times of economic crisis, it is not the time to be concerned about profits. Selling all the products in exchange for a large amount of cash in hand is the most important thing for the business to survive.

To let state-owned enterprises destock, just an executive order is enough. Everyone will definitely implement it seriously, and few bureaucrats will be stupid enough to fight against the government.

Private companies are different. There is no way for the government to directly intervene in the market. In the capitalist economic market, the government cannot interfere with the normal operation of enterprises.

As a law maker, the government cannot break the law. Besides, with so many companies overcapacity, they can't be ordered directly to reduce production, right?

Anyway, the survival of the fittest in the market will always kill a batch of them. Long-term pain is worse than short-term pain, and whoever lives and who dies depends on their abilities.

There is nothing wrong with the cabinet choosing to save the state-owned enterprises first, and the son will always be given preferential treatment. The unsalable products of state-owned enterprises are exported, and the pressure of domestic overcapacity is also reduced.

Franz continued to ask, "Is the emergency plan ready?"

It is not that private enterprises will not be rescued, but mainly depends on the specific situation of the economic crisis and takes measures according to the actual situation.

The government is not a nanny and cannot guarantee that a business will not go bankrupt. Whether it can survive or not depends on the capitalists' own judgment.

If you kill yourself, you will really die. Smart people saw the big moves of state-owned enterprises and began to follow the trend early in the morning.

If you can't react, you should be unlucky. Didn't you see that the royal family was running for their lives?

The Royal Bank can be regarded as the weather vane of the Austrian economy. As long as the bank tightens its money supply, there must be a problem with the economy.

It is even more impossible to open an economic crisis. If you do that, there will be no economic crisis, and an economic crisis will be created artificially.

Once the market panics, the losses are more terrifying than the economic crisis. According to Franz's experience, the economic crisis is a game, whoever runs fast is the winner, and whoever takes the game deserves to be unlucky.

Prime Minister Felix explained: "Your Majesty, this economic crisis is different from the past. It is purely overcapacity. Not only us, but the vast majority of European countries have overcapacity.

The American Civil War and the Russian-Prussian War made this crisis even more serious. Before the war, there were signs of excess production capacity in various countries.

If the crisis hit then, the market would quickly adjust itself. It is different now. It is initially estimated that the domestic production capacity should exceed 30% of the market demand, and some industries may exceed half of the market demand, or even higher.

We simply have no choice but to let the market survive the fittest and weed out the weak. The whole world cannot find such a large market and release such a large production capacity. "

This is the aftermath of making money from the war. During the Russian war, most of the supplies were monopolized by Austria, which led to overcapacity in many industries in Austria.

After the war, the market underwent some self-regulation. However, economic transformation cannot be accomplished in a matter of months.

Now that the economic crisis is coming, many companies that have been slow to respond will naturally be unable to escape.

Of course, the impact on large enterprises may not be too fatal. After all, the war fortunes have been made in the past two years and capital strength has been accumulated.

As long as there is no blind expansion, I still have some money in my pocket and ammunition to get through this crisis.

Overcapacity is serious, which also means that it is impossible to escape the crisis by exporting to the outside world. When the economic crisis broke out, the international market would soon shrink, and the only markets belonging to Austria were the native country and the colonies.

Other overseas markets are not worth mentioning at all. It is not a matter of market size, but a matter of purchasing power.

In any case, Austria is also the world's largest economy in this era. There are two other countries with more population than Austria, yet the market is nowhere near comparable.

Of course, when counting colonies, this ranking is down one place. The British are still the kings of this era, and no one can compare with them.

Franz nodded, the solution is not impossible, but it is not suitable for this period. The economic crisis broke out, and the traditional industry crisis broke out.

To a certain extent, it also accelerated the outbreak of the second industrial revolution. If traditional industries do not have enough profits, capitalists have to focus on emerging industries.

It is conceivable that it will not be long before Austria's new industries will bloom in all directions. In this context, Franz would naturally not intervene.

When the capitalists fall into the economic crisis, they can only be considered unlucky. My own investment vision is not good, who is to blame?

It is a sacrifice for the new era, shining for the second industrial revolution.