Which 1907 U.S. market panic helped lead to creation of the Federal Reserve System?

The Panic of 1907 was the U.S. market panic that helped lead to creation of the Federal Reserve System.

The panic began in October 1907 after an unsuccessful attempt to corner the stock of United Copper Company. The failure spread to banks and trust companies connected with the speculators, while withdrawals and loss of confidence put pressure on New York's financial system.

Banker J. Pierpont Morgan organized private support, including emergency lending and efforts to prevent the collapse of major institutions. The episode demonstrated how dependent the United States was on a small number of private financiers for crisis management.

Congress responded by establishing the National Monetary Commission, which studied central banking abroad. The Federal Reserve Act followed in 1913. The panic did not directly create the Fed overnight, but it was a major political and financial argument for a permanent lender of last resort.