Back home, Diamond’s father is trying to figure out what to do now that he has lost his job. He talks to an old friend, who convinces him to come look at a horse he purchased. The friend suggests that the horse and a wagon would enable Diamond’s father to move people and their luggage for a stable income. When Diamond’s father sees the horse for sale, he recognizes it as Old Diamond, Mr. Coleman’s horse. The horse rests its head against Diamond’s father’s chest, and he cries at the reunion. The friend, moved, sells Diamond’s father the horse and a four-wheeled cab. He also tells Diamond’s father that he can move his family into the rooms above the stable. 

Diamond’s mother has had a baby, and she, the baby, and Diamond return to London. Diamond does not notice the horse is Old Diamond, and the family reunites in the rooms above the stable. Conditions are not as nice as they used to be because they no longer have a view of the river, there is no garden, and one of their neighbors drinks heavily, argues with his wife, and pinches his child.