Panic of 1837

Henrietta Wood

The Panic coincided roughly with the sale of Henrietta Wood by Henry Forsyth to the Cirode Family, though it is difficult to say whether the sale was caused by Forsyth’s failure, which is difficult to date precisely. Cirode also had difficulty once he arrived in New Orleans because of the Panic, which led to numerous firms’ failures. See marler2013. See Louisville for discussions of effects of Panic there.

See also gudmestad2011, p. 18-20, for interesting anecdote about the Natchez log books:

When the Panic of 1837 struck, a captain who had just come from Louisville scrawled, ‘Reports all Cincinnati & Louisville banks stopped!,’ to which another visitor added, ‘God Dam.’


  • Edward Baptist in baptist2012 stresses the role of southwestern banks, securitized slaves, and the systemic risk of the cotton economy. (See also kilbourne1995.)
  • Daniel Walker Howe in howe2007 stresses the pressures that British lenders put on their American debtors in early 1837, after a poor grain harvest meant England needed cash quickly to import crops from Europe, but he also adopts the Whig attack on Jackson’s Specie Circular (501-504). By planting doubts in the public mind about the safety of state banknotes, he helped trigger a run on specie-poor creditors after some early firm failures and the contraction of British credit. He also mentions southwestern frontier speculation and cotton over-production (504) coupled with a collapse in cotton prices, but he emphasizes its role more in the 1839 aftershocks of the Panic.
  • Sean Wilentz locates the beginnings of the Panic in two years of wheat failures that “threw the balance of trade against the United States,” together with “falling cotton prices,” which “led British banks and creditors to demand repayment in hard currency from American borrowers” (p. 456). Banks suspended specie payments.