The Panic of 1792 followed speculation in securities issued by the new United States government.
The panic developed in March and April 1792, only a few years after the federal government began operating under the Constitution. Speculators, including William Duer and Alexander Macomb, borrowed heavily to buy government securities and bank shares. Their failures undermined confidence and caused prices to fall.
The crisis spread through financial markets in New York and Philadelphia. Treasury Secretary Alexander Hamilton responded by using federal resources to purchase government securities and reassure lenders. His intervention helped stabilize markets and is an early example of government action during a financial panic.
The episode also exposed the fragility of the young nation’s financial system. The Bank of the United States, chartered in 1791, was still new, and securities trading lacked modern safeguards. The Panic of 1792 is sometimes linked to the Buttonwood Agreement, but that agreement created the New York Stock and Exchange Board in 1817, not the panic itself.