All three men were utterly dumbfounded by Lestrade's pronouncement that Stangerson was murdered. Lestrade sat down, and Holmes asked him to tell of what he had discovered. Lestrade began by explaining that he was sure Stangerson had been involved in the murderer of Drebber, and set about figuring out more about him. It was clear that Stangerson and Drebber had been together earlier in the day of Drebber's murder, but Stangerson's whereabouts were unknown from 8:30 to the time of the murder.
Lestrade called on hotels and lodging-houses and finally lucked out when he questioned the proprietor at Halliday's Private Hotel on Little George Street. The man told Lestrade Stangerson had been expecting another man for two days now, and assumed Lestrade was he. Lestrade and the man went upstairs to Stangerson's quarters and prepared to knock on the door when Lestrade suddenly glimpsed a rivulet of blood coming from under Stangerson's door. The men burst into the room and espied Stangerson lying dead and cold on the floor, with the cause of death a deep stab on the man's left side that had entered the heart. Most terrifying, however, was that the word RACHE was written in blood upon the wall.
All the men in the Baker Street apartments were quiet and shocked. Lestrade continued his tale, saying that he spoke with a young boy who had witnessed a man leaving by ladder from the window of Stangerson's apartment, but assumed that he was a carpenter or joiner at the hotel. The boy said the man was "tall, had a reddish face, and was dressed in a long brownish coat." He had clearly stayed in the room for a bit after the murder because there was bloody water in the wash basin and marks of the bloody knife on the sheets.
The only things found in the room were Drebber's purse with money that was unmolested, a telegram that said "J.H. is in Europe," and a small box with a few pills in them next to a glass of water on the table. At this news of the pills Holmes jumped from his seat and loudly exclaimed, "The last link... my case is complete."
Holmes excitedly told the group that he now had all the threads of the case to make a tangle, and even though there may be some small details lacking, he had the main facts. He asked if Lestrade had the pills, and when the latter said yes, picked them up and examined them. Watson noted that they were small, light gray, round, almost transparent, and clearly water-soluble. Holmes asked Watson to go downstairs and retrieve a dog that their landlady told them was very sick and needed to be put out of its misery.
Watson returned with the dog, Holmes took a pill and cut it in half, dissolved one half in water with some milk to make it palatable, and placed it before the dog. The dog lapped it up but nothing happened, and Holmes grew frustrated. After a few moments of consternation understanding dawned upon his face and he took the other pill from the container and did the same thing. This time, the dog had only barely licked the water when he gave a shiver and died suddenly. At this Holmes said exultantly, "I ought to know by this time that when a fact appears to be opposed to a long train of deductions, it invariably proves to be capable of bearing some other interpretation." One of the pills was poison, the other a placebo.
Holmes told his nonplussed companions that they were no doubt all perplexed because none of them seized upon the one important fact from the case that he had; "hence things which have perplexed you and made the case more obscure have served to enlighten me and to strengthen my conclusions. It is a mistake to confound strangeness with mystery. The most commonplace crime is often the most mysterious, because it presents no new or special features from which deductions may be drawn."
After listening impatiently to this speech Gregson demanded Holmes to tell him what he had discovered, conceding that Holmes did have a special gift for deduction. Holmes replied that the man would commit no more murders in the interim, that he was shrewd and desperate, that he had no idea the law was after him, and that Holmes could not yet tell them who the man was and that the others needed to trust Holmes on the matter.
Young Wiggins knocked on the door and informed Holmes the cab was ready for him. Holmes thanked him and took out a pair of handcuffs, showing them to his companions for their admiration. Watson narrated that he knew nothing regarding Holmes going on a trip, and wondered at the cab's presence. The driver entered the room and Holmes asked him to assist him with his luggage. As soon as the man, grumbling, bent over, Holmes clamped the handcuffs on him and triumphantly announced that this man, Mr. Jefferson Hope, was the murderer of Stangerson and Drebber.
Jefferson Hope mightily struggled with all four men, whose combined strength was barely enough to subdue him. Holmes suggested taking the cab to Scotland Yard to deliver the captive, and told the other men they could now ask him any questions they wanted about the case and his deductive process.
The Sherlock Holmes tales are a combination of modernization and magic; they amalgamate scientific and forensic processes with good old-fashioned drama and suspense coupled with fantastic stylistic elements. Holmes is rational but eccentric, capable of deductive reasoning as well as dreamy rumination. One of the most significant contemporary works of critical analysis on this particular novel deals with the tension between modernity and enchantment. The article's author, Michael Saler, discusses the reconciliation of the "rational and secular tenets of modernity with enchantment" present in the outlook at the fin-de-siècle. This perspective is in contrast to the prevailing view espoused by Max Weber that saw the late 19th century emphases on rationalization and bureaucratization as inimical to the medieval/early modern emphases on enchantment and magic.
Saler's main thesis centers on the phenomenon of readers legitimately believing Sherlock Holmes was a real person, not merely a literary creation of an Arthur Conan Doyle. As Saler points out, "Holmes was the first character in modern literature to be widely treated as if he were real and his creator fictitious." Plenty of articles were published in the years after the book's publication that ignored Doyle and treated Watson and Holmes as real people. This was not merely a British phenomenon but an international one as well.
Even though other characters that preceded Holmes inspired similar public interest (Samuel Richardson's Pamela, Goethe's Werther, Dickens's Little Nell), none had the same cult following as Holmes. Those characters were also more difficult to identify with, making the Holmes cult stranger. His fantastic nature was not the only thing that made him different from the other characters; the Holmes cult encompassed all of his fictional universe.
Of course, the question remains: why Holmes? Saler identifies the most important reason as being "the climate of cultural pessimism among intellectuals during the waning decades of the nineteenth century and early decades of the twentieth," with its disenchantment with the world and bemoaning of higher ideals and communal beliefs that resulted from capitalist rationalization and bureaucratization. Nostalgia, spiritualism, occultism, and psychical research tried to fill that void. The conflict between modernity, exemplified by progress to the rational and away from the supernatural, and the beliefs/activities of "enchantment" left the latter somewhat marginalized and scoffed at.
The Holmes stories brought back a feeling of magic but without actual magic. Holmes yearned for magic but sought it using modern methods, not thinking about the past; "[he] became a modern icon partly because he utilized reason in a manner magical and adventurous, rather than in the purely instrumental fashion that many contemporaries feared was the stultifying characteristic of the age." Overall, the Holmes stories also express Doyle's ambivalence about modernity –its limitations, its dreariness and squalor, its anonymity.