58 THE PRELUDE TO THE COLLAPSE OF 1893 
engaged in building up deposits there by accumulating every 
sovereign that could be spared in the other centres. It was, of 
course, merely robbing Peter to pay Paul, for the object of 
the transfer was to maintain the buoyant conditions in Mel- 
bourne, or, in the case of the more cautious banks, to strengthen 
their position in that quarter. There was no sudden shutting 
down in Sydney, but the gradual contraction of credit there 
checked speculation very effectively.l 
The second factor was the incidence over the whole state 
of another drought in 1888-9. Farmers and stockowners both 
suffered very severe losses; and increased support had to be 
given by the banks, who were themselves seriously implicated, 
and all this accentuated the monetary tightness.? Speculation 
ceased entirely, and most of the land companies found them- 
selves in serious trouble in consequence. 
Probably for the same reason that street lamps become dim 
after sunrise, the part played by Queensland in this period is not 
usually appreciated. Melbourne quite outshone both Brisbane 
and Sydney by the brilliance and the grand scale of her financial 
eruption, but the historian is apt to ignore the important part 
played by Queensland in the troubles of the day. Much of 
the activity in this state after 1880 depended upon vigorous 
development which was eminently justified. But speculative 
factors here, as in the south, intervened to force on an expansion 
that was too rapid to be healthy. Much of the activity found its 
chief outlet in the opening up of the lands on the coastal belt 
where sugar plantations were being established. The westward 
expansion of the pastoral industry absorbed, quite legitimately, 
much of the capital that began to pour in. But from these two, 
as financial foci, was generated a volume of speculation that 
ultimately overwhelmed sound enterprise in Queensland for a 
decade. All the features of the land gamble in the southern 
states were faithfully repeated in Queensland. A fictitious 
prosperity was reflected in a strong market for Queensland 
* Harris comments: ‘The largest amount of capital received for investment 
purposes, £6-2 millions, came in 1885; but the drop in the marriage rate and the 
strike suggest that the peak had been passed.’ 
? The extent to which nine banks were involved is shown by their registration as 
early as 1883 as owners of over 500 squattages totalling at least 15 million acres. 
Coghlan estimates from the official returns that the banks were liable for one-sixth 
of the area under pastoral lease in New South Wales,