J. P. Morgan helped calm the 1907 U.S. banking panic by organizing emergency financial support.
In October and November 1907, a failed attempt to corner shares of United Copper helped trigger a run on the Knickerbocker Trust Company in New York. Fear spread as depositors withdrew cash and banks became reluctant to lend to one another. The United States had no modern central bank to provide emergency liquidity.
J. P. Morgan gathered bankers, examined institutions, and pressured them to provide funds where he believed support could prevent wider collapse. He also helped arrange financing for the New York City government when the city faced difficulty meeting its obligations.
Morgan did not single-handedly solve every problem, and the panic exposed weaknesses in the U.S. financial system. Its aftermath contributed to the creation of the Federal Reserve System in 1913. The 1907 panic is therefore both a banking crisis and an important prehistory of modern central banking.