1837 Panic

The panic of 1837 is a famous and destructive financial crisis throughout the American history (McGrane 1). This financial crisis resulted in huge influence in the America commerce and society. During that time, the price of agriculture goods raised tremulously, while the price of manufactured goods decreased ( Garland 3). The business were extremely low, and the condition in Wall street became worse(Hone 248). Thus, more and more people could not afford the living costs and were “struggled to free themselves from its oppression” (McGrane 1). This financial crisis not only influenced the contemporary people, but also “ marked the close of one epoch in our industrial history, and the beginning of a new era” (McGrane 1). Confronted by the huge
Majority of the citizens were worried about their families because they realized that panic would result in family financial crisis. During the panic, prices of daily essentials such as agriculture products increased tremendously so that people could not afford what they used to have in the family. For instance, the price of flour rocketed from 6.5 to 11 within a year (Price of Flour 70). Flour, an important food source for majority of the family, suddenly became such a burden to a lot of people because of its high price. People had to spend almost twice as much as money on food than they used to spend, so they could not help cutting off the spending on other luxuries such as tobacco and whisky. This is proved by the fact that the demand of whisky “ slackened off considerably” and the market of tobacco had been extremely low (General Market 2). As a result, the quality of life generally decreased among the American families because with the same amount of income, they could not afford what they usually consumed before That is, people were concerned about this crisis because they could not maintain the standard of living that they used to have. Moreover, the decreased family income made the situation even worse. According to Garland, while the price of agriculture products and raw materials increased tremulously, the price of
During the panic, lots of merchants were suffered from huge losses and even closed their business. Philip Hone, a contemporary merchants, described that the business were extremely low, and the condition in Wall street were “getting worse and worse” (Hone 248). Price of merchant products were continually failing, which may cause more panic in the market ( Garland 3). As a result, the domestic business environment was in a severe downturn and it was hard for people to sustain what they used to own in their jobs or businesses.Furthermore, the situation of global market was not promising as well. Cotton, which is the staple export of America, was influenced by the overall trend of low price in domestic market ( Monthly Commercial Chronicle 478). Despite the price of cotton decreased from fifteen per pound to six per pound, the oversea demand for the cotton was still low (Perkins 7). This made the situation of merchants even worse because they could not resolve the financial problem in domestic market by expanding internationally. This unfavorable global market would foster the failures of the businesses. Apart from the low domestic and global demand, the banking policies imposed great money pressure on businesses and people started to lose confidence on the credit system offered by