OTD: International panic as Jay Cooke & Co. fails

On today’s date in 1873, widespread panic erupted after the failure of the brokerage firm Jay Cooke & Co., resulting in a five-year depression across much of North America.

Known as the Panic of 1873, the furor that spread across both Canada and the U.S. was a result of the bank overextending itself in completing the Northern Pacific Railway (NPR).

Jay Cooke, the bank’s founder, was attempting to compete with the Canadian Pacific Railway by having his railway enter Canadian territory, meddling with Canadian politics, which was apprehensive to encroaching U.S. business interests at this time.

After an exhausting Civil War, the U.S. began looking for opportunities to expand. Eventually, Cooke focused his attention on resurrecting the NPR. He was able to successfully lobby U.S. Congress to facilitate his grand plan to finance the railway’s construction, and the first tracks of America’s second trans-continental railroad were laid.

But as construction continued, it became clear that more money would be needed to cover rising costs. Cooke’s optimism for the costly project exceeded his firm’s ability to pay for it, leading to its failure.

Leave a Reply

Keep up to date with the numismatic community

Sign up to receive our newsletter.

Canadian Coin News


Canadian Coin News is Canada's premier source of information about coins, notes and medals.

Although we cover the entire world of numismatics, the majority of our readers are Canadian, and we concentrate on the unique circumstances surrounding collecting in our native land.

Send Us Your Event

Running an event? Send it to us and we will display it on Canadian Coin News!

Submit Event →

Subscribe To 26 Issues For Just $45.75/year

Subscribe today to receive Canada's premier coin publication. Canadian Coin News is available in both paper and digital forms.

Subscribe Now

We acknowledge the financial support of the Government of Canada through the Canada Periodical Fund of the Department of Canadian Heritage.