The U.S. financial crisis that began in 1819 after land speculation and falling cotton prices was the Panic of 1819.
The panic followed the end of the War of 1812 and the expansion of lending by state-chartered banks. Easy credit helped drive land prices upward, especially in western territories. When the Second Bank of the United States tightened credit and demanded payment in specie, land values and commodity prices fell sharply.
Bank failures, foreclosures, unemployment, and business closures spread across the United States. The crisis was the first major peacetime financial crisis in the country and produced a severe economic contraction during the early 1820s.
It is sometimes confused with the Panic of 1837, another U.S. crisis linked to banking and land speculation. The 1819 panic also helped shape public hostility toward the Second Bank of the United States, an issue that became important during Andrew Jackson’s presidency.