Panic of 1847
As a means of stabilizing the British economy the ministry of Robert Peel had passed the Bank Charter Act of 1844. This Act fixed a maximum quantity bank notes that could be in circulation at any one time and guaranteed that definite reserve funds of gold and silver would be held in reserve to back up the money in circulation. Furthermore, the Act required that the supply of money in circulation could only be increased when gold or silver reserves were proportionately increased. However, in 1847, the Peel Banking Act was suspended when the Bank of England was presented with a letter from the Prime Minister and Chancellor of the Exchequer indemnifying the Bank for a breach of the Bank Charter Act. The crisis in the money market ended almost immediately without any breach of the Act. Apparently Marx and Engels claimed that it was the suspension of the Peel Banking Act that caused the Panic of 1847, but this is not supported by the historical record.
The panic of 1847 cleared away a vast number of unsound business houses, and trade generally became much more sound and healthy; this lasted until the year 1855. The explanation by Spanish economist, Jesus Huerta de Soto, of Austrian School, is based in Austrian Theory of the Business Cycle:
"As of 1840 credit expansion resumed in the United Kingdom and spread throughout France and the United States. Thousands of miles of railroad track were built and the stock market entered upon a period of relentless growth which mostly favored railroad stock. Thus began a speculative movement which lasted until 1846, when economic crisis hit in Great Britain.
It is interesting to note that on July 19, 1844, under the auspices of Peel, England had adopted the Bank Charter Act, which represented the triumph of Ricardo’s Currency School and prohibited the issuance of bills not backed 100 percent by gold. Nevertheless this provision was not established in relation to deposits and loans, the volume of which increased five-fold in only two years, which explains the spread of speculation and the severity of the crisis which erupted in 1846." 
- John Turner, Banking in Crisis (Cambridge U. Press, 2014) pp. 72-75.
- See note 238 contained in the Collected Works of Karl Marx and Frederick Engels: Volume 12 (International Publishers: New York, 1979) pp. 669-670.
- See note 238 contained in the Collected Works of Karl Marx and Frederick Engels: Volume 12 pp. 669-670.
- John Turner, Banking in Crisis (Cambridge U. Press, 2014) pp. 74.
- id.; Glasner, David (1997). "Crisis of 1847". In Glasner, David; Cooley, Thomas F. Business cycles and depressions: an encyclopedia. New York: Garland Publishing. pp. 125–28. ISBN 0-8240-0944-4.
- See note 238 contained in the Collected Works of Karl Marx and Frederick Engels: Volume 12, p. 669.
- Evans, David Morier (1849). The Commercial Crisis, 1847-1848: Being Facts and Figures. London.
- Glasner, David (1997). "Crisis of 1847". In Glasner, David; Cooley, Thomas F. Business cycles and depressions: an encyclopedia. New York: Garland Publishing. pp. 125–28. ISBN 0-8240-0944-4.
- Michael Bordo (2003). Stock Market Crashes, Productivity Boom Busts and Recessions: Some Historical Evidence.
- Arthur Crump, The English Manual Of Banking, Longmans, Green & Co, 2nd edition (1877).
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