Which 1907 U.S. financial panic was halted after J. P. Morgan organized a private rescue of trust companies?

The story behind the answer

The 1907 U.S. financial panic was called the Panic of 1907.

The crisis began in October 1907 after an unsuccessful attempt to corner the stock of United Copper Company. Depositors then withdrew money from trust companies, especially the Knickerbocker Trust Company in New York. Because the United States had no central bank, the banking system lacked a formal lender of last resort.

Financier J. P. Morgan gathered bankers, examined institutions, and committed funds to prevent further failures. The New York Stock Exchange also received emergency support. The panic eased after confidence returned, but the episode exposed weaknesses in the U.S. financial system.

The crisis helped inspire the creation of the Federal Reserve System in 1913. It is sometimes confused with the Panic of 1893, another severe U.S. banking and railroad crisis, but the 1907 episode was the one directly associated with Morgan’s emergency intervention.

Source: Wikipedia · fact-checked Oct. 2026

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