What was the 1920–1921 U.S. market collapse commonly called?

The 1920–1921 U.S. market collapse was part of the period commonly called the 1920–1921 depression.

The downturn followed the end of World War I and a sharp postwar adjustment. Commodity prices fell, inventories accumulated, and businesses faced weakening demand. The Federal Reserve raised interest rates substantially to combat inflation, contributing to tighter credit and pressure on asset prices.

American stock prices declined heavily from their 1919 highs, while farm incomes and agricultural land values suffered especially severe losses. Unemployment rose, and many businesses failed. The contraction was relatively brief compared with the Great Depression, but it was significant across manufacturing, agriculture, and finance.

The episode is often confused with the Long Depression of the late nineteenth century or the Great Depression beginning in 1929. Economists also debate how much of the recovery reflected monetary policy, falling prices, and rapid market adjustment. By 1922, economic activity had begun to recover, setting the stage for the prosperous but speculative 1920s.