The severe United States financial crisis that began in 1819 was called the Panic of 1819. It was the first major peacetime financial crisis in the United States and produced a long economic contraction.
After the War of 1812, expanding banks supplied abundant credit, while land prices and commodity production rose. The Second Bank of the United States later tightened credit, and falling cotton prices weakened borrowers and banks. Land speculation collapsed, and many people lost farms, businesses, or jobs.
The crisis was intensified by international developments, including Britain’s return to the gold standard and reduced demand for American exports. The panic helped shape public distrust of banks and influenced later political arguments over the national bank. It is distinct from the Panic of 1837, which followed a separate credit expansion and banking crisis.