The 1893 U.S. financial crisis was called the Panic of 1893. It began after doubts about railroad financing and the solvency of major companies caused investors and depositors to lose confidence. The failure of the Philadelphia and Reading Railroad in February 1893 was an important early warning, followed by the collapse of the National Cordage Company and a run on banks.
The crisis spread through railroads, banks, businesses, and farms. Hundreds of banks and railroads failed, unemployment rose, and the United States entered a prolonged depression. The Treasury’s limited gold reserves also became a central concern because the government was committed to maintaining the convertibility of paper currency into gold.
The panic is sometimes confused with the later Panic of 1907, which helped inspire creation of the Federal Reserve. The 1893 crisis instead became closely associated with the silver-versus-gold monetary debate and helped shape the 1896 presidential campaign of William Jennings Bryan and William McKinley.