Madame Schachter has been driven insane. During their long ride on the train, she screams about fires and furnaces until she is beaten and made quiet.
While they believe her to be raving mad, it turns out she was actually correct. Fires and furnaces do await them. Perhaps her visions of the future drove her mad; it is possible she was both sane and insane.
In this way, her character is similar to Moshe the Beadle who spoke the truth but was not believed.