The 1907 crisis that began after F. Augustus Heinze’s failed attempt to corner United Copper stock was the Panic of 1907.
Heinze and associates tried to profit by controlling United Copper shares, but the scheme collapsed when the expected stock shortage did not materialize. The failure damaged confidence in banks connected to Heinze and spread to trust companies in New York.
J. Pierpont Morgan organized private support for troubled institutions and helped persuade banks to provide liquidity. The panic exposed weaknesses in the U.S. financial system, which lacked a central bank capable of acting as a lender of last resort.
The crisis helped create political support for monetary reform. The Federal Reserve System was established in 1913, partly in response to the instability revealed by the Panic of 1907.