Summary and Definition of Panic of 1857
Definition and Summary: The Panic of 1857 was a crisis in financial and economic conditions following a period of over expansion in the United States. The causes were a fall in land prices, the failures of railroad companies and crashing wheat prices due to the declining purchase of U.S. agricultural products in Europe.
Panic of 1857 for kids
James Buchanan was the 15th American President who served in office from March 4, 1857 to March 4, 1861. One of the important events during his presidency was the financial Panic of 1857.
The Panic of 1857 for kids
The national economic depression, caused by the Panic of 1857, engulfed the country for nearly three years further increasing tension in the United States which was on the verge of American Civil war (1861-1865) over the issue of slavery.
Panic of 1857 for kids: The Collapse of the Ohio Bank
The Panic of 1857 was sparked by the collapse of a banking institution - the Cincinnati's Ohio Life Insurance and Trust Company. The New York branch of this bank folded on August 24, 1857 and the newly established Telegraph system instantly carried this news right across the nation. Newspapers carried the story, people panicked and tried to get their money, and other banks began to collapse. The picture depicts the run on the Seamen's savings bank.
Panic of 1857: Run on the Seamen's Savings Bank
Causes of the Panic of 1857
The causes of the Panic of 1857 were:
People became aware to the financial crisis due to the publicity surrounding the closure of the Ohio bank
The value of land in the west fell, the number of migrants decreased, and this caused financial problems with the railroads
Railroad securities (stocks) lost their value
Over expansion: Important railroad lines went bankrupt refer to Railroads in the 1800s
Banks that financed the railroads closed - there were 'runs' on banks and a squeeze on credit
Wheat Prices crashed: The end of the Crimean War (October 1853 – February 1856) saw the return of men to their homes and an increase in farm produce. This led to a decline in Europe's purchase of agricultural products in the United States. The price of wheat crashed seriously hitting the economy of the Northern states where wheat was being produced in vast quantities due to the recent invention of the Cyrus McCormick reaper
Effects of the Panic of 1857
The Panic of 1857
Foreclosures and Bankruptcies of railroads, banks and companies
Tension in the nation increased
The Panic of 1857 had a greater effect in the northern states
The Southern states believed that the nation were now strongly dependent on their economy and would become more amenable to the needs of slave owners
The Panic of 1857 blighted the presidency of James Buchanan
It was one of the Causes of the Civil War
The Panic of 1857 for kids
The Panic of 1857 was one of a series of financial crisis to cripple the economy of the United States - refer to the Panic of 1819, the Bank War and the Panic of 1837 for additional facts and information.
Panic of 1857 for kids - President James Buchanan Video
The article on the Panic of 1857 provides an overview of one of the Important issues of his presidential term in office. The following James Buchanan video will give you additional important facts and dates about the political events experienced by the 15th American President whose presidency spanned from March 4, 1857 to March 4, 1861.