The financial panic that began with the failure of Jay Cooke & Company in September 1873 was the Panic of 1873. Jay Cooke & Company, a major American investment bank, collapsed after it could not sell enough securities connected with railroad financing.
The failure helped trigger a broader banking and stock-market crisis in the United States. The New York Stock Exchange closed temporarily, and railroad companies faced severe financial pressure. The panic also affected Europe, where the Vienna Stock Exchange crash earlier that year had already exposed weaknesses in speculative investment.
The downturn contributed to the period later called the Long Depression, although historians debate the precise boundaries and causes of that depression. A common mix-up is to identify the event as the Panic of 1893, another major U.S. financial crisis that also involved railroads. Jay Cooke’s collapse specifically belongs to 1873, when excessive railway speculation and tight credit created a fragile financial system.