policies in determining fluctuations in the 1830s economy. The two intelligent men present their facts and arguments
United States was not the cause of the Panic of 1837.
1837. The opinion of Mr. Hofstadter revolved around one factor, which was the war against the Bank of the United
printed. The only money he trusted was hard money, gold and silver. He was especially bitter against the Bank of
individual and received notes as payments. Unfortunately, these buyers were unable to pay back the notes and
hardships, he was unable to pay off his own debts. President Jackson was faced with a double-sided sword because
people were unable to repay the debts owed to him, while at the same time he could not pay the debts he owed to
defeat Jackson in the 1832 election. Clay induced Biddle to apply for a new charte!
r for the Bank early in 1832. He believed that if Jackson dared to veto the recharter bill, he would lose the election.
The plan did not go according for Mr. Clay and Mr. Biddle and Jackson was still the favorite among the people.
President Jackson and Nicholas Biddle were never met good terms with each other and their relationship was one of
argument and disagreement. In my opinion, Biddle wanted to keep the Bank of the United States intact for the sole
primarily a deflation, as opposed to a decline in production, and it was produced by events over which Biddle had
little control over.
Mr. Jackson?s view of banks was a very distressing one. He, along with the people of his party, believed the same
arena. I believe that President Jackson wanted to de-centralize the bank and make it into a more state level. While
Biddle was a major force behind the powerful Bank of the United States becoming more centralized. As far as I can
see, the Bank War was basically summed up in the following question. Should the United States Bank act as king
United States was at an all time high. This boom was one of the largest producers of the Panic of 1837. It resulted
produced a rapid increase in the quantity of silver in the United States. Banks did not expand their operations
risen. The Panic of 1837 was not caused by President Jackson?s actions. The destruction of the Bank of the United
States did not produce the crisis because it did not produce the boom.
Biddle and Albert Gallatin. Biddle is quoted on saying: ?In my judgment, the main cause of it (the crisis) is the
I believe that international factors were the main cause of the Panic of 1837. The Bank War coincided with two
England initiated a boom in the country around 1832. The British became eager to invest in the United States and to
buy American cotton. In order for the British to export capital to the United States, the United States had to buy
goods to rise, prices in the United States had to rise to make imported goods cheaper than domestically produced
ones. The demand for cotton in Britain caused prices in America to rise higher than they would have. At the same
time, American exports were increasing as were American imports, therefore a trade deficit was harder to produce.
Alongside this problem, changes were taking place in China. Opium p!
urchases were increasing and no longer wanted silver to hoard. They wanted to trade silver for opium and any silver
sent by the United States would then be sent to England in payment for Indian opium. This transshipment was
avoided by substituting American credit for Mexican silver. The silver from Mexico went into bank reserves in
America, allowing prices to rise and the demand for imports to increase. The final international problem I will
discuss is the British demand for our cotton. This demand helped to increase the inflation by reducing the American
dramatically and part of the increase in money supply went into land purchases. The government continued to sell
land at a constant price, and funds that otherwise would have been used to raise prices just stayed in the
government?s surplus. The boom caused inflation to run rampant and the American!
economy was beginning to give way to a panic.
Blaming the Panic of 1837 on President Jackson is an ignorant statement. How can anyone say that this lone factor
an international level. Our trade partners at the time all contributed to the downfall of our economy. President
Jackson?s decision could have been another factor leading into a panic, but in no way was it the only reason for the
economic problems that plagued the American people for years