Mr. Bounderby is Mr. Gradgrind’s best friend and a rich manufacturer, banker, and merchant. He is a large, coarse man, puffed up with pride in his status as a “self-made man” and always ready to promote his rise from nothing at all to his current position.

Now he stands by the fireplace at Stone Lodge, telling Mrs. Gradgrind all about his childhood. He was born in a ditch; abandoned by his mother; raised by a wicked, alcoholic grandmother; kicked around by everyone; and always sick. And he takes great pride in the whole story. Mrs. Gradgrind is a weak woman, almost transparent in her fragile imbecility. She tries unsuccessfully to respond to Mr. Bounderby, who continues his story by relating his rise, without education, to his position as Josiah Bounderby of Coketown. He had no advantage, he insists, yet he is successful.

At this point, Mr. Gradgrind walks in with Louisa and Thomas. Louisa immediately mutters that the two have been “peeping at the circus.” Mrs. Gradgrind is properly horrified, especially considering all the facts the young people know. She tells them to “Go and be somethingological directly,” and the young people leave. Mr. Gradgrind and Mr. Bounderby discuss the situation and decide that Sissy Jupe’s bad influence must be the problem. Mrs. Gradgrind was the one who advocated to accept Sissy at the school, but Mr. Bounderby now asserts that she must be dismissed at once. While Mr. Gradgrind goes to get Sissy’s father’s address, Mr. Bounderby visits Louisa and gives her a kiss, which pleases her not at all.