“In their review of the economic situation, Marx and Engels emphasized above all the importance of the “great overseas markets” for the economic situation of Great Britain (and of European industry generally). After mentioning in this connection the impact of the European revolutions on international trade, they bring out the decisive historical importance – “a fact even more important than the February revolution” – of the discovery of gold in California. The passage that follows reveals extraordinary prophetic vision, since Marx and Engels here foresee the digging of the Panama Canal, the sifting of the center of world trade to the Pacific Ocean (which even today is only a tendency), the industrial and commercial superiority of the United States over Europe (which was not to become a fact until more than half century later), and even the Chinese Revolution! (10). Whereas in the April issue Marx and Engels were inclined to forecast a new crisis of overproduction (11), they became more cautious in the May-October issue, in which their “review” is actually a detailed analysis of the entire economic situation of the capitalist world between 1836 and 1850. This analysis already shows both a deeper knowledge of the facts and a general conception of the cycle which recognizes the strategic role played by certain factors. Thus, the writers emphasize the fact that in Great Britain the superabundant investment of capital in railway building gave the impetus to the prosperity of 1843-1845; the expansion of steam navigation toward the Pacific coast of the United States, toward the Pacific Ocean, toward Australia, worked in the same direction. This wave of investments led to the setting up of a number of new enterprises, which in turn led to overproduction that ‘seemed’ to be the cause of the crisis. Marx and Engels correct a superficial impression and emphasize the fact that the crisis is always in the last analysis a crisis of overproduction (12). The international crisis of 1847, which began with the railways, spread later to the sphere of money and trade, where it was aggravated by the results of the failure of the potato harvest in Ireland, England, France, the Netherland, and Belgium in 1845 and 1846, which in turn caused a considerable rise in the price of corn. Marx and Engels thus ascribe marked importance to the interaction between industry and agriculture in the mechanism of the capitalistic production cycle. They ascribe equally marked importance to purely monetary phenomena and to the key role these played in the beginning of the crisis. An initial panic in April 1847, caused by the Bank of England suddenly increasing the bank rate and by the publication of the Bank’s weekly balance-sheet which showed that its gold reserves had fallen to £ 2,500, 000, did not mean the collapse of the big banking and commercial houses. This was to come about in August 1847, as a result of the bankruptcy of a series of firms specializing in trade in wheat and colonial produce, followed by a series of spectacular bankrupcies of banks and brokers in October of the same year. Once more, Marx and Engels stress the role played by real overproduction in the mechanism of the crisis: excessive expansion of railway building, on the one hand, excessive imports (and exports) of a number of colonial products, on the other. They emphasize the same mechanism when they analyze the prosperity of 1848-1850 in British industry, which was marked much less by speculation than a real expansion of production, especially of the cotton textile industry and its exports, in particular to the countries of the Far East (the authors speak of the Dutch East Indies market, “open” to British trade) and to the Pacific Ocean (affected by the feverish development of California). (…) (pag 71-72); “Nevertheless, as D. Ryazanov points out in his commentary on Marx’s articles of January 1855 (24), all this did not amount to a ‘general’ crisis but only to a ‘partial’ crisis, during which the ‘autonomous’ role of the monetary factor was again revealed. (…) What the author of ‘Capital’ had underestimated was the stimulating effect of the Crimean War on the economic situation. The experience of history here provides an example of what Rosa Luxemburg was later to call the function the state orders could play as “replacement market” in relation to external markets (25). Supplies for the army and the development of war industries largely made up for the setback in exports to Australia. Marx aknowledged this later: in Volume III of ‘Capital’ he classes the years 1854 and 1855 as years of prosperity” (pag 76)” [Ernest Mandel, ‘The Formation of the Economic Thought of Karl Marx. 1843 to ‘Capital”, London, 1971] [(10) Marx and Engels, “Revue”, in ‘Neue Rheinische Zeitung – Politisch ökonomische Revue’, February 1850, pp. 120-121. The Chinese “Tai-ping” revolution actually broke out on January 11, 1851, less than a yearf after Marx and Engels had predicted it; (11) Marx and Engels, “Revue”, in ‘Neue Rheinische Zeitung – Politisch ökonomische Revue’, April 1850, pp. 212-215; (12) Marx and Engels, “Revue – Mai bis Oktober”, in ibid., May-October 1850, p. 304; (24) D. Ryazanov, in ‘Gesammelte Schriften, Vol. I, p. 500; (25) Rosa Luxemburg, ‘The Accumulation of Capital’, pp. 463-466]