Panic of 1797 The United States

**Table 2** Peak-to-Trough Decline in Industrial Production

Year of NBER Peak	% Decline	Year of NBER Peak	% Decline

1890	−5.3	1937	−32.5
1893	−17.3	1945	−35.5
1895	−10.8	1948	−10.1
1899	−10.0	1953	−9.5
1902	−9.5	1957	−13.6
1907	−20.1	1960	−8.6
1910	−9.1	1969	−7.0
1913	−12.1	1973	−13.1
1918	−6.2	1980	−6.6
1920	−32.5	1981	−9.4
1923	−18.0	1990	−4.1
1926	−6.0	2001	−6.2
1929	−53.6

Source: The industrial production data for 1919–2004 are from the Board of Governors of the Federal Reserve System. The series before 1919 is an adjusted and smoothed version of the Miron-Romer index of industrial production. This series is described in the appendix to “Remeasuring Business Cycles” by Christina D. Romer.
Note: The peak-to-trough decline is calculated using the actual peaks and troughs in the industrial production series. These turning points often differ from the NBER dates by a few months, and occasionally by as much as a year.

Table 2 Peak-to-Trough Decline in Industrial Production

Year of NBER Peak

% Decline

Year of NBER Peak

% Decline

1890

−5.3

1937

−32.5

1893

−17.3

1945

−35.5

1895

−10.8

1948

−10.1

1899

−10.0

1953

−9.5

1902

−9.5

1957

−13.6

1907

−20.1

1960

−8.6

1910

−9.1

1969

−7.0

1913

−12.1

1973

−13.1

1918

−6.2

1980

−6.6

1920

−32.5

1981

−9.4

1923

−18.0

1990

−4.1

1926

−6.0

2001

−6.2

1929

−53.6

Source: The industrial production data for 1919–2004 are from the Board of Governors of the Federal Reserve System. The series before 1919 is an adjusted and smoothed version of the Miron-Romer index of industrial production. This series is described in the appendix to “Remeasuring Business Cycles” by Christina D. Romer.

Note: The peak-to-trough decline is calculated using the actual peaks and troughs in the industrial production series. These turning points often differ from the NBER dates by a few months, and occasionally by as much as a year.

Name	Duration	Causes
Panic of 1785	1785 1788	1) Over expansion and debt defaults after Revolution, 2) British manufacturing competition 3) British refusal to conclude commercial treaty 4) Lack of adequate credit and a sound currency, Stronger federal government demanded by northeast.
1789 Copper Panic	1789 1793	1) Lack of good money as copper coins were debased by counterfeiting which led to commercial freeze up in several northern States Hamilton's new paper money restored confidence.
Panic of 1797	1796 1799	1) Land speculation bubble was bursting 2) Major northern financial panic caused by lack of good money as central bank of England withheld species to minimize insolvency due to war debts. Prosperity continued in the south.
Recession 1802	1802 1804	1) Drop in export prices as war in Europe. 2) Trade was disrupted by pirates, leading to the First Barbary War.
Depression of 1807	1807 1810	1) English impressments of US sailors during war with France angered the nation. 2) Jefferson responded with the export restricting Embargo Act of 1807 which paralyzed costal economies and hurt southern farm exports. Macon's 1810 Bill Number 2 ended the embargo and started recover. Embargo's primary aim to preserve European war neutrality failed as the country eventually was pulled in with the War of 1812.
Panic of 1819	1815 1821	1) Recession with inflation and financial panic followed war expansion was caused when a slow economy resulted in a real estate collapse. 2) Panic of 1819, the first US major peacetime financial crisis was followed by a general collapse of the American economy. It persisted through 1821
Panic of 1837	1837 1844	1) NY Banks stopped species payments began seven years of recession 2) Speculative western loans 3) a sharp decline in cotton prices 4) a collapsing land bubble, 5) Restrictive lending policies in Great Britain

Name Duration	NBER Wholesale Prices Drops	Months Duration	Causes
Panic of 1857-58 1857-1858	-23%	30	Debt financed over expansion caused by the 1848-1857 Gold Rush set the stage for a contraction.1) Shortage of species money reserves in England spread to US causing high interest rates and less lending 2) Speculative US Investments suffered from higher rates beginning with Agriculture/RR/Land investments. 3) Loss of European cotton demand crippled southern economy, 4) Western Land bubble crashed
Panic of 1873 and the Long Depression 1873 –1879	−33.6% (−27.3%) ^{[nb 3]} Unemployment exceeded 14%.	65	Prelude: Great Chicago Fire and the Equine flu epidemic–which demobilized or killed nearly every horse in America 1) Financial Crisis in Europe spread to US with the failure of the banking house of Jay Cooke and Company over the Northern Pacific Railway. 2) Speculative greenback based paper currency Civil War currency and 3) rampant fraud in the building of the Union Pacific Railway up to 1869 culminated in the Credit Mobility panic. Railway overbuilding and weak markets collapsed the bubble in 1873. The resulting stagflation – the combination of high unemployment and high inflation resulted in the 1879 return of the United States to the gold standard with the Specie Payment Resumption Act.
Panic of 1893-94	Industrial Production 1890 −5.3 1893 −17.3	17	1) RR speculation caused led to Reading Railroad failure and withdrawal of European investment led to a stock/banking collapse. 2) Repeal the Sherman Silver Purchase Act to end the easy money policy. 3) Bank runs followed as foreign investors wanted species. Result was political instability and the height of the U.S. populist movement with its the Free Silver "cross of gold" movement.^[23]
Panic of 1907-08 1907 –	-29 -31.0% ^{[nb 3]}	13	Since the Jackson era banks had been decentralized and during periods of boom, banks able to lend unchecked. A run on Knickerbocker Trust Company deposits on October 22, 1907, set events in motion that would lead to a severe monetary contraction. The fallout from the panic led to the Federal Reserve System.^[24]
1920-21	−38.1% −32.7% Unem- ployment peak 11.7%	18	The Spanish Flu epidemic of 1918 killed 500,000 would blunt post war demand. 1) After the war troops returned to few jobs, tight money to hinder 1919 inflation, and low agricultural demand from Europe caused a short severe recession with severe deflation but Real GDP only lost between 2.7% and 7%. 2) Labor conflict with many strikes caused the First Red Scare. Many blame the newly formed Federal Reserve for this recession See The Forgotten Depression of 1920: The Power of Limited Government 6 min video
Depression 1929-39	25%^[32] (1933)	140	1) A speculative financial boom financed with borrowed money resulted in a Worldwide stock market and banking crash. 2) A brief 1930 recovery was swatted by the Smoot–Hawley Tariff Act.
1973-74 Recession	9% peak	16	1973-75 Recession 1) Vietnam war debt caused inflation and foreigners not wanting cheapened dollars asked for gold so in 1971 Nixon Shocked the world and took the US off its partial gold standard. 2) 1973 Quadrupling of oil prices by OPEC increased domestic prices 3) Business and unions responded with price and wage increases causing inflationary psychology as consumers quickly spent before the value of their money decreases 4) 1973 collapse of the Bretton Woods monetary system ended WW 2 boom. Recession officially ending in 1975 but the country experienced low economic growth and middle class income stagnation for years.
1990-91 Recession	7.8%	8¹	he 1990s were the longest period of growth in American history. The collapse of the speculative dot-com bubble, a fall in business outlays and investments, and the September 11th attacks,^[47] brought the decade of growth to an end. Despite these major shocks, the recession was brief and shallow.^[48]
Great Recession 2007-09¹	10% peak	18	1) Speculative real estate practices and home loans led to the collapse of the United States housing bubble. 2) Falling housing-related assets contributed to a global financial crisis, even as oil and food prices soared. 3) Some US large financial institutions: Bear Stearns, Fannie Mae, Freddie Mac, Lehman Brothers, City Bank and AIG crashed Prompt Government Action avoided a pending auto industry crisis, mitigated the financial crisis, began the recovery but have been unable to return measured economic growth.
¹Listed because many had not experienced the affect of a recession coinciding with the end of a stock market bubble. ¹Name refers more to 1) the slow economic recovery 2) the discovery that measured real wage growth began to slow due to foreign competition which meant higher wage fringe benefits could no longer be passed on to consumers

Sources The 13 Worst US Recessions, Depressions, and Panics Follow us: @247wallst on Twitter \| 247wallst on Facebook	Annualized GDP change from 1923 to 2009. Data are annual from 1923 to 1946 and quarterly from 1947 to the second quarter of 2009.
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