The U.S. financial panic of 1893 that followed railroad failures and triggered a severe stock-market collapse was the Panic of 1893. It began after major railroad companies failed and confidence in banks and businesses deteriorated.
The crisis produced a run on banks, a sharp contraction in credit, and widespread business failures. The collapse of the Philadelphia and Reading Railroad and the failure of the National Cordage Company were among the developments that intensified the panic. Gold outflows also strained the U.S. Treasury because the country was operating under a gold-based monetary system.
The depression that followed became one of the worst economic downturns in nineteenth-century America. Unemployment rose, wages fell, and labor unrest increased, including the Pullman Strike of 1894. The Panic of 1893 is distinct from the Panic of 1873 and the Panic of 1907, although all three involved financial instability and major market disruption.