Financial and unemployment troubles result. They are blamed on the 'oil crisis', although this is only part of the story. Conservative government elected. Unlike the earlier land boom in the cycle, this phase is based mainly upon a feeling of confidence that the recession is over. It is ultimately a speculative era.
Some technological innovation does occur, but capital investment is grossly inadequate.
During this period of up to fourteen years, the economy not only 'recovers', but culminates in a bout of speculative frenzy that far surpasses the earlier boom. The coming of the railways leads to runaway land speculation. Commodity speculation also occurs. Government debt increases. Protectionist sentiment is to the fore.