Panic of 1907 — Knickerbocker Trust Bank Run
Impact
NYSE −50% from peak
What happened
A failed attempt by a copper magnate to corner the United Copper Company stock triggered the collapse of Knickerbocker Trust, one of New York's largest. The run spread to other trust companies inside 48 hours. No Federal Reserve existed. There was no lender of last resort. A full-blown banking crisis could only be stopped by private coordination, which is what happened.
Context
JP Morgan personally stopped the 1907 Panic by pledging his own money and convincing other bankers to do the same — information and trust were the only tools available.
Era
01 · Telegraph & Newspaper
Financial news traveled by telegraph wire then printed in morning papers. A London statement took 3 days to reach New York traders. Information was scarce and power concentrated in those who had it first.
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Other events in this era
← Earlier in era
First transatlantic telegraph message
Later in era →
Rockefeller's Statement