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Panic Of 1837

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Panic Of 1837

  1. 1. Panic of 1837!
  2. 2. What was the Panic of 1837? <ul><li>The Panic of 1837 was a financial panic and crisis that rocked the nation in 1837. It was followed by a depression that lasted until 1843. </li></ul><ul><li>The Panic was the most severe financial crisis and depression that the new nation had ever seen. </li></ul><ul><li>Most of the banks in the nation closed down and unemployment rates reached an all time high. </li></ul>
  3. 3. Causes/Leading up to the Panic <ul><li>There was a slight economic boom before the Panic. Banks began loaning out to individuals and foreign markets began loaning their money to investors. Banks began printing huge amounts of paper money, which led to inflation. </li></ul><ul><li>Because of the huge inflation that followed, currency depreciated. The foreign banks stopped accepting paper money as payment, and investors were thrown into debt. After the inflation, Jackson issued the Specie Circular, which people say was largely the cause of the Panic. </li></ul>
  4. 4. Andrew Jackson <ul><li>Jackson was president before the Panic and issued the Specie Circular. </li></ul><ul><li>The Specie Circular was an order that required land to be purchased in only gold and silver, not paper currency. </li></ul><ul><li>Jackson was very wary of the federal bank. He refused to continue the charter of the National Bank and pulled out all of its funds and placed them in state banks. </li></ul><ul><li>Van Buren became president five weeks before the Panic of 1837. </li></ul><ul><li>Van Buren carried out the Specie Circular, even through the Panic. </li></ul><ul><li>Van Buren refused to involve the government during the Panic, and many people blamed him for the Panic. </li></ul><ul><li>They also blamed the irresponsible banks for the Panic. </li></ul>Martin Van Buren
  5. 5. Picture Time!
  6. 6. The Panic! <ul><li>The Panic actually began when, in New York City, every bank stopped payment in specie (gold and silver). </li></ul><ul><li>Out of 850 banks in the United States, 343 closed entirely and 62 failed partially. </li></ul><ul><li>During this time, many banks restricted credit and called in loans. Many people attempted to withdraw their loans before depression hit, but failed to do so. </li></ul><ul><li>Depression and debt hit the nation, and food riots popped up in all the major cities. Construction companies were also affected as they failed to meet their obligations, causing the failure of many railroad and canal projects. </li></ul>
  7. 7. The Aftermath <ul><li>The impact of the depression lasted until 1843. </li></ul><ul><li>Van Buren lost his re-election, and the Whigs took this opportunity to elect William Henry Harrison as their first president. </li></ul><ul><li>The tariff of 1842 also helped the economy recover by 1843. </li></ul>

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