Which 1857 crisis began after the Ohio Life Insurance and Trust Company failed?

The Panic of 1857 began after the Ohio Life Insurance and Trust Company failed. The company’s collapse in August exposed fraudulent practices and helped trigger a wider loss of confidence in banks, railroads, and land investments.

The crisis spread through the United States as railroad expansion slowed, banks suspended payments, and businesses failed. A major contributing factor was the collapse of speculative investments connected to rapid western expansion. The failure of the SS Central America in September, which sank with a large shipment of gold, further reduced available financial liquidity.

The panic became an international financial crisis, affecting Britain and other markets. It was severe but relatively brief compared with later depressions, and economic activity began recovering before the American Civil War.