The 1873 financial crisis was called the Panic of 1873. It began amid banking failures and railway speculation in Europe and the United States and helped usher in the prolonged downturn known in many countries as the Long Depression.
In the United States, the failure of Jay Cooke & Company in September 1873 shocked investors. The firm had heavily promoted bonds for the Northern Pacific Railway, and doubts about railway finance spread through banks and markets. The New York Stock Exchange closed temporarily for the first time in its history.
The crisis was international. Financial stress had already appeared in Austria-Hungary and Germany, and failures and falling prices spread through interconnected economies. Economic historians debate the exact duration and severity of the Long Depression, but the Panic of 1873 is its conventional starting point.
The event is distinct from the Panic of 1893 and Panic of 1907, which were later U.S. crises. It also occurred before the Federal Reserve was created; the U.S. central bank began operating in 1914.