The boom of the early 1870s

The boom came to an end in 1873 with a European financial crisis in the spring, which spread outwards from Vienna, and a financial panic in New York in the autumn which had a greater effect on the British economy than the earlier continental financial disturbance. Between 1863 and 1866 British capital exports had amounted to £29.3m per annum average but during the boom of the early 1870s the volume of net capital exports increased to £73.6m per annum. Domestic share prices on the London market after October 1869 rose rapidly but the developing financial boom was checked by uncertainty caused in the summer of 1870 by the Franco-Prussian war. The investment trusts together with the private syndicates which floated many of the foreign government loans during the early 1870s boom can be considered as the spiritual heirs of the finance companies of the 1860s.