The 1819 U.S. financial crisis that caused widespread bank failures, foreclosures, and a severe stock-market decline was the Panic of 1819.
It was the first major financial crisis in the United States after the nation’s founding. The crisis followed the end of the Napoleonic Wars, when falling agricultural prices weakened farmers and land speculators. The Second Bank of the United States tightened lending and called in loans, intensifying the downturn.
Banks failed, businesses closed, and unemployment rose sharply. Many borrowers lost farms and property after being unable to meet payments. The panic also contributed to political anger over banking practices and helped shape later debates about federal economic policy.
The Panic of 1819 is sometimes confused with the Panic of 1837, another major American crisis. The earlier panic began in 1819 and occurred before the United States had a modern national stock exchange system.