The Panic of 1837 followed the collapse of land speculation and the failure of many American banks.
The panic began in May 1837 when New York banks suspended the convertibility of banknotes into gold and silver. Land prices had risen rapidly, and banks had expanded credit, often using speculative real-estate values as support.
President Andrew Jackson’s policies also shaped the crisis. The Specie Circular required payment for federal land in gold or silver, while the federal government had removed deposits from the Second Bank of the United States. These measures contributed to financial instability, though historians debate the relative importance of each cause.
The downturn brought bank failures, falling commodity prices, business closures, and high unemployment. It lasted for several years and affected both the United States and international trade.