J. P. Morgan helped stop the Panic of 1907 by organizing private rescue funds. The crisis began after a failed attempt to corner the stock of United Copper Company caused runs on trust companies and banks in New York.
Morgan, already one of America’s most powerful financiers, gathered bank leaders in his library and pressed them to provide liquidity. He also used his own money and influence to support threatened institutions, including the New York City treasury.
The Panic exposed the weakness of a banking system without a central bank. Congress later created the National Monetary Commission, and the Federal Reserve System was established in 1913.
Morgan did not single-handedly solve every financial problem, but his emergency coordination was central to containing the panic. The episode is often treated as a major reason the United States adopted a central bank.