at the peak of howell works' production, however, allaire's business empire suffered a series of financial and other setbacks from which it would never fully recover. in october 1836, his steamship the "william gibbons" ran aground and was destroyed. in may of the following year, the panic of 1837 began, triggering a prolonged recession throughout the united states. at about the same time, the howell works furnace blew out. the loss of the "william gibbons", along with difficulties in obtaining loans and the loss of product demand caused by the panic, prevented the works from returning to full production for two years.