The U.S. financial crisis that began in 1837 after bank failures, falling cotton prices, and a credit contraction was the Panic of 1837.
The crisis followed years of land speculation, easy credit, and rapid banking expansion. President Andrew Jackson’s policies, including the removal of federal deposits from the Second Bank of the United States and the Specie Circular, changed how land purchases were financed. International financial pressure and falling cotton prices then intensified the strain.
Banks suspended payments of gold and silver, businesses failed, and unemployment rose sharply. The downturn lasted for several years and became a defining economic problem for President Martin Van Buren, who took office in March 1837. Van Buren promoted an independent treasury system rather than restoring the national bank.
The Panic of 1837 is sometimes treated as the beginning of a longer depression, but the panic itself refers to the financial shock and suspension of specie payments. It is distinct from the Panic of 1819 and the Panic of 1857, which had different immediate triggers.