The Panic of 1873 began in Europe and the United States after financial speculation and railroad failures. In the United States, the collapse of the banking firm Jay Cooke & Company in September 1873 helped trigger a financial panic. Jay Cooke had heavily promoted bonds for the Northern Pacific Railway, and investors became increasingly unwilling to finance railroad expansion.
The New York Stock Exchange closed temporarily during the panic, and many banks and businesses failed. The resulting depression was especially severe and lasted for years, with unemployment, falling prices, and industrial weakness in several countries. In Europe, related financial problems were connected to speculative booms and the Vienna Stock Exchange crash earlier in 1873.
The crisis is sometimes called the Long Depression, although historians debate the exact dates and whether that label should cover the entire period. It should not be confused with the Panic of 1893, another major U.S. banking and railroad crisis two decades later.