Abstract
The Bank Panic of 1907 was the final banking crisis of the National Banking Era (1863–1913); it was significant in that it led to the Federal Reserve Act. The panic began when the spectacular attempt by F. Augustus Heinze to corner the stock of United Copper Company collapsed on 16 October 1907. The collapse revealed the extensive links of Heinze to another notorious financier in the New York City banking community, Charles F. Morse, a man O. M. W. Sprague (1910, p. 248) describes as having ‘an extreme character, even by American speculative standards’. Solvency concerns led to a series of bank runs at several national banks controlled by the two men. Yet the turmoil surrounding the Heinze collapse did not produce a systemic panic in New York, because the New York Clearinghouse took prompt corrective actions on the member institutions.
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Bibliography
Cleveland, H. van B. and Huertas, T. (1985) Citibank 1812–1970. (Cambridge, MA: Harvard University Press).
Moen, J. and Tallman, E. (1992). The Bank Panic of 1907: the role of the trust companies. Journal of Economic History 52, 611–30.
Sprague, O. (1910) History of Crises Under the National Banking Era. (National Monetary Commission. Washington, DC: Government Printing Office).
Woodlock, T. 1908. The stock exchange and the money market. Reprinted from The Currency Problem and the Present Financial Situation. New York: Columbia University Press.
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Moen, J.R., Tallman, E. (2008). Panic of 1907. In: Durlauf, S.N., Blume, L.E. (eds) The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-58802-2_1240
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DOI: https://doi.org/10.1007/978-1-349-58802-2_1240
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