The 1907 financial panic was called the Panic of 1907 after a failed attempt to corner United Copper stock.
Speculators F. Augustus Heinze and his associates believed they could force short sellers to buy United Copper shares at inflated prices. The plan failed, and the resulting losses spread to banks and trust companies connected to the group. Confidence weakened further when depositors began withdrawing money.
The crisis became especially severe after the failure of the Knickerbocker Trust Company in New York. J. P. Morgan organized private support and persuaded other financiers to provide liquidity, helping prevent a still wider collapse. The episode exposed the limits of relying on individual bankers during a national financial emergency.
The Panic of 1907 helped build political support for a central bank. Several years later, the United States created the Federal Reserve System in 1913. The panic therefore connects a speculative stock scheme with a major change in financial institutions.