The 1819 Financial Crash

Bob Hoye sends along this ditty:

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The failure of the Second Bank of the United States occurred with the crash in the fall of 1819.

Essentially newspapers and congress were more responsible than now and asked how would society benefit by bailing out “those who failed from an ignorance of their business, and the want of prudence and economy”?

The New-York Commercial Advertiser lampooned:

There is a cause, we needs must own,
Why much distress and want are known:
Extravagance – our country’s bane,
Is spread o’er city, town, and plain:
To dress, to visit, and to play,
To get in debt, and run away,
Are common vices of the day.

Then on January 1, 1820, the New-York Evening Post published:

Old “Uncle Sam,” in chasing bubbles,
Has jump’d into a pack of troubles,
Troubles, ’tis said, which sorely vex him,
And which ’tis feared will much perplex him.

That the third US central bank is a failure of promises has yet to be widely accepted, but when it is, we hope it inspires some equally appropriate wit.

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BOB HOYE
INSTITUTIONAL ADVISORS
MARCH 30, 2009

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