The 1901 New York Stock Exchange panic over control of Northern Pacific Railway was called the Panic of 1901.
The episode grew from a struggle between rival groups led by E. H. Harriman and James J. Hill on one side, and J. P. Morgan and James J. Hill’s allies on the other, over Northern Pacific. On 9 May 1901, Northern Pacific shares rose dramatically as traders rushed to obtain stock needed for control. When the corner broke, the share price collapsed and broader market selling followed.
The panic was the first major stock-market crash on the New York Stock Exchange in the twentieth century. It particularly damaged investors who had sold Northern Pacific shares short and then found that stock was difficult or impossible to borrow. The event demonstrated how a concentrated battle for control of a major railroad could destabilize the wider market.
The Panic of 1901 is distinct from the Panic of 1907, which involved a banking crisis and the Knickerbocker Trust Company. It is also distinct from the 1893 panic, which was tied to railroad failures, bank runs, and broader economic weakness.