The 1907 U.S. financial panic triggered by the Knickerbocker Trust Company’s failure was the Panic of 1907.
The crisis began after a failed attempt to corner the stock of United Copper Company. Depositors then rushed to withdraw money from Knickerbocker Trust, New York’s third-largest trust company, which suspended operations on October 22, 1907.
The panic spread through banks and the stock market. J. P. Morgan organized private emergency financing, while Treasury Secretary George Cortelyou supplied government funds. The episode exposed the weakness of the U.S. banking system before a central bank existed.
The panic helped inspire the Aldrich–Vreeland Act of 1908 and, ultimately, the creation of the Federal Reserve System in 1913. It is sometimes confused with the Panic of 1893, another severe U.S. banking crisis.