The Panic of 1893 followed the collapse of the Philadelphia and Reading Railroad and a major U.S. banking crisis.
The railroad had expanded aggressively and entered receivership in February 1893. Other financial pressures included overbuilding, weak commodity prices, failures among rail companies, and concerns about the U.S. monetary system. The crisis spread through banks and businesses, producing a severe depression.
The panic caused widespread bank closures, business failures, unemployment, and social hardship. It also weakened confidence in the government’s gold reserves and intensified the political dispute over silver and gold that shaped the 1896 presidential election.
The event is sometimes mixed up with the Panic of 1907, which came later and helped motivate the creation of the Federal Reserve. The Panic of 1893 was one of the most serious American financial crises before the twentieth-century banking reforms.