The 1873 financial crisis that caused a prolonged stock-market downturn in Europe and the United States was called the Panic of 1873.
The panic began in the United States after the failure of Jay Cooke & Company in September 1873. The bank had heavily promoted Northern Pacific Railway bonds, and doubts about railroad investment helped undermine confidence. The New York Stock Exchange closed temporarily, an unusual emergency measure.
Financial distress spread internationally, affecting banks, railways, businesses, and investors. The resulting economic contraction is often linked to the Long Depression, a period of weak growth and falling prices that lasted for years, although historians debate its exact duration and severity across different countries.
The Panic of 1873 should not be confused with the Long Depression itself. The panic describes the financial crisis that helped begin the downturn, while the depression describes the longer economic period. The crisis also reflected the risks of rapid railway expansion and speculative finance.