New York’s stock exchange was central to the 1907 Panic that helped lead to creation of the Federal Reserve.
The crisis began after a failed attempt to corner the stock of United Copper Company. When the scheme collapsed, depositors withdrew money from banks and trust companies connected to the speculators. The panic spread through New York’s financial system, and the New York Stock Exchange suffered a severe liquidity shortage.
Financier J. P. Morgan organized private support, persuaded banks to provide funds, and helped prevent a broader collapse. The episode showed how heavily the United States depended on individual financiers because it had no modern central bank at the time.
The Aldrich–Vreeland Act of 1908 created emergency currency arrangements and established the National Monetary Commission. Its work contributed to the Federal Reserve Act of 1913. The Federal Reserve was therefore created several years after the panic, not during the crisis itself, and the 1907 event was a major influence rather than its sole cause.