Timetables (2)

Topic: U.S. History #1-Panics and Depressions

1784-86 The new nation's first depression results from a shortage of currency and the war debt,

1819 A panic is precipitated by wild speculation in western lands, followed by a sharp contraction of credit, led by the Second Bank of the United States. A six-year depression ensues.

1832 When President Andrew Jackson refuses to renew the charter of the Second Bank of the United States and transfers government funds to state banks, Nicholas Biddle, head of the National Bank, calls in commercial loans. A panic and recession follow. Eight hundred banks close, and the banking system collapses. One-third of manual laborers are out of work in New York City alone. Nationwide, unemployment reaches 10 percent.

1836 President Jackson precipitates another banking crisis by issuing the Specie Circular, declaring that the federal government will henceforth require hard currency for purchase of western public lands.

1837-43 In response, English banks raise interest rates and reduce credit, sending shock waves through the cotton market that initiate a six-year depression.

1857-58 This brief panic is notable for the role that telecommunications plays. When a branch of the Ohio Life Insurance and Trust Co. fails, news that would formerly have taken weeks to crisscross the nation, its impact diminishing with time, is known within hours, thanks to the telegraph. The news induces one of the first waves of panic selling in the stock market. The underlying cause of the recession is a downturn in agricultural exports brought on by the end of the Crimean War in Europe, as well as overspeculation in railroads and real estate.

1873-78 A major depression begins, precipitated by the failure of Jay Cooke and Company, which financed the Northern Pacific Railroad. Businesses topple, and the New York Stock Exchange closes for ten days. Before the depression is over, 100 banks and 18,000 businesses will fall.

1893-97 A series of railroad bankruptcies causes banks to call in their loans. In all, 150 banks, 200 railroads, and 15,000 small businesses succumb. Unemployment reaches 25 percent, and in New York City alone 20,000 are homeless. The depression lasts four years.

1929-41 The Great Depression is set off by a stock market crash. Before it is over, 12.8 million people will have suffered unemployment and in 1930 and 1931, 2,300 banks fail. (31)

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