Which bank's failure helped begin the U.S. Panic of 1873?

The failure of Jay Cooke & Company helped begin the U.S. Panic of 1873. The investment bank announced that it could not meet its obligations on September 18, 1873, after investors lost confidence in its financing of Northern Pacific Railway bonds.

Railway expansion had attracted enormous investment, and many projects depended on continuing access to credit and rising land values. When Jay Cooke’s firm failed, the shock spread through financial markets and helped trigger a broader banking and railroad crisis.

The panic was part of a wider international downturn sometimes called the Long Depression. The New York Stock Exchange closed temporarily, and numerous railroads, banks, and businesses entered bankruptcy or suspended operations.

The Panic of 1873 is not the same event as the Vienna market crash that year, although both were connected to a broader international financial crisis. Jay Cooke & Company’s failure is the key U.S. starting point, while the collapse of the Viennese market is central to the European story.