The 1792 U.S. financial panic was called the Panic of 1792. It was an early American securities-market crisis involving aggressive speculation in bank and government securities, especially in New York and Philadelphia.
Speculators used borrowed money to buy securities, and falling prices created pressure to repay loans. The crisis was intensified by uncertainty surrounding the young federal financial system and by the failure of important securities dealers. Alexander Hamilton, the U.S. Treasury secretary, responded by using Treasury resources and encouraging banks to provide liquidity.
The episode helped establish the federal government’s role in stabilizing financial markets. It also contributed to the development of rules against market manipulation. The Panic of 1792 is sometimes confused with later U.S. panics because it occurred before the creation of the Federal Reserve and before modern stock exchanges took their present form.