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Lecture

Panic of 1837.docx

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Department
Sociology
Course
SOC 202
Professor
Louis Pike
Semester
Fall

Description
Panic of 1837 Since the Panic of 1837 was the largest depression that America has faced, the recovering process took a while. This economic downfall lasted approximately 8 years in total. There was no real solution that took place too end the economic depression other than a change in government. But there was something which helped during the depression to resolve it. Given that, one of the reasons for the depression was banks accepting hard money (gold and silver) and not paper money it was extremely difficult for the society to do anything, because the money they had was not being accepted by banks and others. There was one solution to this problem and it was The Sufflock Bank. This bank was located in Boston, and the purpose of the bank was to trade your paper money in exchange for hard money in other words gold or silver. Since there was only one bank in the entire country that was willing to exchange your money, it was tough on the people who lived far away. The aftermath of the depression was very severe. Across the country unemployment rose, bankruptcy became common, and many businesses failed. Throughout the 8 year depression 850 banks went completely out of business. Over 250 businesses in New York alone failed. The only lesson learnt following the depression was to elect a new government system and to change the ruling of the banks. During the 1837 panic, Adam Smith’s economic th
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