The Panic of 1893
In the 1890's, the American economy and financial system was still undergoing a period of rapid expansion. Increased investment in large commercial ventures such as railways, coupled with rapid urban development, resulted in an economic boom throughout the first years of the 1890's.
By 1893, the town of Pullman was providing a livelihood for thousands of its residents. But, disaster soon followed. The Panic began in June 1893, when depositors began trading their Treasury notes in for gold, weary of the United States' shrinking gold reserves1. Hundreds of banks soon failed throughout the United States, resulting in one of the largest and most profound financial crises in the history of the United States. The Panic continued well into the fall of 1893, and its impact was quite devastating.
Some historians have estimated that between 1892 and 1894, industrial production fell by 15.3 percent, and unemployment rates sat somewhere between 17 and 19 percent1. The effects of the Panic of 1893 would not fully subside until the later half of the decade.
1Gary Richardson and Tim Sablik. “Banking Panics of the Gilded Age.” Federal Reserve History. Accessed April 17, 2023. https://www.federalreservehistory.org/essays/banking-panics-of-the-gilded-age.