The author attempts to analyse how the impact of the American War of Independence influenced the political and economic situation on British Isles in 1777. The main aim is to record the changing atmosphere on British Isles throughout the year 1777 with an emphasis on the varying situations after the battle at Saratoga and understanding the whole conflict amongst the British politicians. One of the author's aims will be an analysis of the british international trade between the years 1773-1782. To achieve diploma's aim, the author will answer four basic research questions. The author will analyse primary sources and modern day scientific literature related to the given topic while not forgetting to place the whole given period into a complicated contemporary context. Keywords Great Britain, The American War of Independence, the Year of the Hangman, lord Frederick North, The British Isles, International Trade of Great Britain in 18th Century, 1777, Battle of Saratoga 1777