The Panic of 1907 was the U.S. financial panic that prompted Congress to create the Federal Reserve System.
The crisis began in October 1907 after an attempted cornering of United Copper Company shares failed. The failure triggered runs on banks and trust companies, especially in New York City. Because the United States had no central bank, financier J. P. Morgan organized private support to stabilize institutions and the stock market.
The panic exposed weaknesses in the American banking system. In response, Congress established the National Monetary Commission, whose work helped lead to the Federal Reserve Act of 1913. The Federal Reserve began operations in 1914.
The event is sometimes called the Knickerbocker Panic because the Knickerbocker Trust Company collapsed during the crisis. It is different from the Panic of 1893 and the later crash of 1929: those were separate episodes with different immediate causes and consequences.