What event began the Panic of 1873 when the Vienna Stock Exchange collapsed on May 9?

The collapse of the Vienna Stock Exchange on May 9, 1873, began the Panic of 1873, known in German as the Gründerkrach.

The Gründerkrach, meaning “founders’ crash,” followed a speculative boom in Austria-Hungary. Investors had poured money into newly created companies, especially during a period of rapid industrial development and easy optimism. When confidence broke, prices fell sharply and many businesses failed.

The panic spread through financial connections to Germany and the United States. In the United States, the failure of the banking firm Jay Cooke & Company in September 1873 helped trigger a major market crisis and a long economic downturn. The resulting depression was called the Long Depression, although its severity and duration varied by country.

The Gründerkrach should not be confused with the entire Panic of 1873. The German term specifically refers to the Vienna stock-market crash, while the panic describes the broader international financial crisis that followed.