The 1873 financial crisis that helped end the railway speculation boom in Europe and the United States was the Panic of 1873.
The crisis followed heavy investment in railways, land, and industrial companies. In the United States, Jay Cooke & Company failed on September 18, 1873, after it could not sell enough bonds connected with the Northern Pacific Railway. The failure damaged confidence in banks and securities markets.
The New York Stock Exchange closed temporarily on September 20, one of the first such closures in its history. The resulting depression affected production, employment, banks, and railroad companies on both sides of the Atlantic.
In Europe, the collapse of the Vienna stock market in May 1873 had already signaled the strain. Historians debate the exact boundaries of the resulting depression, but the panic clearly marked the end of a major railway-financing boom and began a prolonged period of economic weakness.