J. P. Morgan helped organize the private rescue that eased the Panic of 1907 in the United States.
The crisis began after a failed attempt to corner the shares of United Copper Company. Depositors then lost confidence in institutions connected with the scheme, especially the Knickerbocker Trust Company of New York. Runs on banks and trust companies threatened to spread through the financial system.
Morgan, already one of America’s most powerful financiers, brought bankers together in his library and used his influence and money to coordinate emergency support. He helped identify institutions that could be saved and arranged funds to keep credit flowing.
The episode exposed how dependent the United States was on private intervention during a systemic panic. There was no permanent central bank capable of acting as a modern lender of last resort. The crisis helped build political support for the creation of the Federal Reserve System in 1913, although the Federal Reserve did not itself exist during the panic.