The U.S. financial crisis that began after the Second Bank of the United States tightened credit in 1819 was the Panic of 1819.
The crisis followed the end of the War of 1812 and a boom in land prices, cotton, and other commodities. State banks had expanded lending, often using land and crops as collateral. When prices declined, borrowers found it harder to repay loans and banks faced increasing pressure.
The Second Bank of the United States attempted to restrain risky lending and collect debts. That contraction contributed to falling land values, business failures, foreclosures, and unemployment. The effects were especially severe in western and agricultural regions.
The Panic of 1819 was the first major peacetime financial crisis in the United States. It is distinct from the Panic of 1837, which followed a later banking and land boom and produced another severe depression.