🔗 Panic of 1873

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The Panic of 1873 was a financial crisis that triggered an economic depression in Europe and North America that lasted from 1873 to 1877, continuing until 1879 in the French Third Republic and in the United Kingdom of Great Britain and Ireland. In Britain, the panic started two decades of economic stagnation known as the "Long Depression" that weakened the country's economic leadership. In the United States, the period of economic stagnation was known as the "Great Depression" until the events of 1929 and the early 1930s set a new standard.

The Panic of 1873 and the subsequent depression had several underlying causes, of which economic historians debate the relative importance. American inflation, rampant speculative investments (overwhelmingly in railroads), the demonetization of silver in Germany and the United States, ripples from economic dislocation in Europe resulting from the Franco-Prussian War (1870–1871), and major property losses in the Great Chicago Fire (1871) and the Great Boston Fire (1872) all contributed to a massive strain on bank reserves, which in New York City plummeted from $50 million to $17 million between September and October 1873. The first symptoms of the crisis were financial failures in Vienna, the capital of Austria-Hungary, which spread to most of Europe and to North America by 1873.