The Panic of 1907 was the U.S. financial panic that followed a failed attempt to corner United Copper stock.
Speculator F. Augustus Heinze and associates believed they could profit by controlling United Copper shares. The attempt failed, and the resulting losses spread through connected banks and trust companies. Confidence deteriorated rapidly, producing bank runs and a severe liquidity shortage in New York.
The crisis became especially important because the United States had no modern central bank. J. Pierpont Morgan coordinated private-sector support, persuaded institutions to provide funds, and helped prevent a wider collapse. His intervention demonstrated how heavily the financial system depended on one powerful private banker during emergencies.
The panic helped build political support for monetary reform. The Aldrich–Vreeland Act of 1908 created emergency currency provisions, and the Federal Reserve System was established in 1913. The stock speculation was the trigger, but the broader panic reflected weaknesses in banking regulation and the country’s fragmented financial structure.