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At Christmastime, Markheim, the protagonist, comes to a dealer’s shop, pretending that he is looking for a present for a lady. His real plan, however, is to murder the dealer so he can steal his merchandise and money. Markheim rejects the dealer’s suggestion of a hand mirror for the lady, referring to it as a “hand conscience.” Presumably, from his reaction to the mirror, Markheim feels twinges from his conscience even before he commits the murder. While the dealer is still in the midst of assisting him in finding a present, Markheim stabs and kills him.

The action of the story after the murder is limited, with most of it taking place inside Markheim’s mind; the setting is restricted to the dealer’s shop and house. The murder has intensified Markheim’s nerves and consciousness; as a result, he is easily startled and alarmed by the external noises and shadows he hears and sees inside the shop. Ticking and striking clocks, footsteps running past the shop, shadows cast by flickering candles and the dim light outside, and falling rain all unnerve him and make him even more overwrought.

Internally, he reproaches himself for how he has carried out his crime and imagines that his neighbors somehow know of his crime and are planning his punishment. All these alarms and fears eventually lead him to believe that he is not alone in the shop; he becomes increasingly convinced that there is some presence lurking somewhere, even though he had seen the dealer’s servant leave earlier, and he knows the dealer was alone in the shop.

His fears and imaginings are interrupted by a gentleman beating on the door and shouting for the dealer; he departs when he receives no answer. This interruption reminds Markheim of his purpose, and he realizes he must act quickly before he is interrupted again. He gets the keys from the dealer’s dead body and enters the dealer’s drawing room to gain access to the money cabinet. He is momentarily calmer and more relaxed as he searches for the key for the cabinet but is jarred suddenly by the sound of footsteps mounting the stairs.

He is surprised to see a friendly, familiar face appear at the door. He concludes that his visitor is not human but rather a spirit. This visitor—perhaps a devil, perhaps an angel, a hallucination of Markheim’s conscience, or his double—proceeds to urge Markheim to move on with his crime because the servant is returning home. It also claims to know Markheim rather well. Markheim refuses to acknowledge any connection with this being, which he perceives as evil. He claims to hate evil and love goodness; he also excuses away his murder because of poverty. Markheim and the visitor continue to debate Markheim’s connection with evil.

As they argue, Markheim gradually weakens, although he struggles hard to distance himself from evil and maintain his goodness. In the end, Markheim acknowledges and accepts his evil nature through his realization of the extent to which he has fallen morally. The doorbell rings just then; the servant has arrived, and the visitor encourages Markheim to murder the maid and finish his crime quickly. Markheim, with his new self-knowledge, decides to act to redeem himself. He determines that the way to salvation lies in confessing his crime and accepting his eventual execution. At this assertion, the visitor’s features transform; they brighten, soften, and then disappear. When Markheim acknowledges his evil nature and acts to redeem himself, his visitor’s work is done.

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