The 1907 U.S. financial panic that followed the failed attempt to corner United Copper Company shares was the Panic of 1907.
The episode began after speculators F. Augustus Heinze and Charles W. Morse tried to manipulate United Copper’s stock. When the scheme failed in October 1907, depositors rushed to withdraw funds from banks and trust companies connected to the speculators. The resulting loss of confidence spread through New York’s financial system.
The crisis became especially severe when the Knickerbocker Trust Company collapsed. J. Pierpont Morgan organized private support for threatened institutions and helped coordinate emergency financing. The panic exposed weaknesses in the U.S. banking system, which lacked a central bank capable of acting as lender of last resort.
The Federal Reserve System was created in 1913, partly in response to lessons from the panic. The crisis is sometimes called the Knickerbocker Panic, but Panic of 1907 is the standard historical name.