The Panic of 1792 was the early United States’ first major financial crisis. It involved speculation in government securities and bank shares, followed by a sudden collapse in prices and severe credit strain.
William Duer and Alexander Macomb borrowed heavily to speculate, helping fuel a boom in securities trading. When prices fell, defaults spread through financial markets. The crisis threatened the young federal government’s financial system, which had only recently been organized under Treasury Secretary Alexander Hamilton.
Hamilton responded with emergency measures, including a Treasury-supported securities purchase program and an appeal to banks to continue lending. His intervention helped stabilize markets. The panic is sometimes confused with later nineteenth-century panics because U.S. financial crises were repeatedly named for the year or event in which they occurred. The 1792 episode is especially significant because it demonstrated the federal government’s early role as a stabilizing force in national finance.