The U.S. financial panic associated with railroad overexpansion and the failure of the Philadelphia and Reading Railroad was the Panic of 1893.
The crisis followed years of aggressive railroad building, speculation, and heavy borrowing. The Philadelphia and Reading Railroad entered receivership in February 1893, and the failure of the National Cordage Company in May intensified concerns. Runs on banks and railroads spread as investors and depositors tried to obtain cash.
The panic helped trigger a severe depression in the United States, with widespread business failures and high unemployment. The federal government’s gold reserves also became a major political issue, contributing to a bond deal with the banking firm of J. P. Morgan in 1895. It is separate from the Panic of 1907, which occurred fourteen years later.