There have, in every instance in the past, been tell tale signs going into the peak that the economy was experiencing credit stress. Easy to see in hindsight, but let us see if history gives us some clues about what to look for at this most important time in the cycle, the end years, in order that we might apply this to the current cycle. The list below highlights the events that occurred to reveal the stresses to all. Given the lack of understanding of economics today, the events that occurred as described below are usually offered as the cause of the following downturn, which, if you have studied the works of say David Ricardo, Henry George and Ludwig Von Mises, you would know is not actually correct. Such an event can only bring on the downturn because so much credit was created in the first place to finance the purchase of the government granted licenses, the largest of which is land value. The banking system is the key, as money will be becoming tighter into the final years of the 18-year cycle. The credit tightening becomes problematic only if asset prices were permitted to rise substantailly beforehand, to unaffordable levels.

Therefore, the collapse of a financial institution takes on extreme importance if:
a) we are approaching the end years of the (average 18-year) cycle, and
b) extensive credit growth has financed a large rise in asset prices, especially land value.

1991 downturn:
December, 1988. Savings & Loans banking crisis, a whole heap of banking failures that had been getting progressively worse, brought into full view only after the government could no longer supress the information immediately after the 1988 elections. Land prices had been rocketing in the years prior to this.

1974 downturn:
October, 1973. Collapse of US National Bank of San Diego, the largest bank failure in 40 years, at the time. Bank owned by C. Arnholt Smith, a close friend of Richard Nixon (chief campaign organiser and fund rasier in fact) and a very large real estate speculator in Southern California. Land prices saw a sustained increase, 1970 to 1973.

1955
Did not take place, war affected. No real land price gains to speak of prior to this time, with the Great depression and subsequent war still very much on the mind of most people.

1932 downturn:
November, 1930. Collapse of the banking empire of Rogers Caldwell, heavily invested in real estate. Only at this point did things turn really nasty. The month prior, October 1930, the stock market broke below its 1929 crash low (a mid point of the 1920's run up) so the markets knew bad news was on its way. The 1930's US depression was brought on by collapsing real estate values nation-wide placing great stress on the banking system, (after sustained increases throughout the 1920's), stresses the Fed did very little to alleviate at the time. The Great Depression was not caused by the stock market collapse. (Though of course it didn't help the situation.)

1914:
Downturn cut short by world war. No real land speculation in the lead up to these years, at least in the manner of prior cycles. Land prices rose steadily, without any noticable speculation to speak of. Ironically, the worlds newest, tallest building opened in 1911, built solely with cash. (The Woolworth building.)

1893 downturn:
November (20th), 1890, collapse of Barings Bank, the Queens own banker, in London. Two weeks prior to that, Novmeber 7th, the Bank of England had lifted its discount rate from 5 to 6 percent. In the US, Decker, Howell and Company failed November 11th, after sharp declines in the stock market, though markets had been declining for most of the year already. The Decker failure also involved the Bank of North America. Easy in hindsight we might say though, as US markets recovered from this shock after very good grain harvests in 1891, a bouyancy in which the rest of the world did not participate. The credit difficulties were obvious however by February of 1893 (20th), with the collapse of Philadelphia and Reading railroad after struggling to meet its bond payments. Worth noting in this downturn, the US market went on to see panic in May of 1893, on the 4th , which, as it happens, was exactly 180 weeks from the 1890 events. Substantail land speculation had been undertaken in the lead up to these events.

1873 downturn:
September, (8th to 17th) 1873. This was the actual month of collapse. The data gets harder to find the further back we look. It is clear that railroad companies were struggling for profitability in the lead up to this month, though this may or may not have been obvious to the astute abserver. The market - or at least the wieght of general opinion expressed in the index price - knew however: the rails index had been slowly declining since its peak in May of 1871. (See also the 'reading the tea leaves' section of the 1873 real estate chapter.) Substantial land speculation prior to these events, especially from rail-road companies.

1857 downturn:
August, (24th) 1857. Failure of the Ohio Life and Trust Company (a bank despite its name), a Cincinnati operation with its New York office one of the most respected banks in that city. Panic October. Substantial land speculation resulting from easy credit policies occurred after 1852.

1837 downturn:
July (11th), 1836. President Jackson's (in)famous specie circular, enforcing payment for Federal lands in silver or gold only, rather than bank-notes that had up until that time been acceptable. As it happens, the circular coincided with the failure of several banks in London. Substantial land speculation had been taking place using the easy credit (bank-note issue) provided by the growing number of banks opening up in the new territories. Panic May 1837.

1819 downturn:
Prior to the 1819 panic, a premium for specie emerged, and in March of 1818 a premium for Spanish dollars in particular, the major circulating medium of the time (Rothbard, Panic of 1819, page 11) indicating that public confidence in bank notes was deteriorating. Not much further can be said here, the data just isn't available, except that in December of 1818 and January of 1819, the price of cotton halved, eventually flowing through to the land used to grow the crop, a price upon which banks had been happily creating prodigious quantities of credit. Banks started collapsing as a result.

2010.
As we progress well into the first decade of the 21st century, land prices (or as experienced by most individuals, house prices) have been sky-rocketing. Credit, not hard to get. Stock markets are hitting new highs world wide on the back of feverish merger and acquisition activity, again financed by credit. Interest rates are no longer at historically low levels and have been rising. Federal Reserve bankers are worried about the threat of inflation. The last years of the 18-year cycle are approaching. Sound familiar... Significantly for our purposes, land price is approaching a level from which it could easily collapse if confidence is shattered by some event or other.