History·14 February 2026·5 min read
The Panic of 1907 — the crisis that created the Fed
A banking panic was stopped by one rich man. The scare convinced America to build a central bank.
In 1907, a panic swept American banks: people rushed to withdraw their money, and banks collapsed. There was no central bank to step in.
One man instead of an institution
The banker J.P. Morgan used his own fortune and influence to save the system. But people realized a country can't rely on one rich man — so, in 1913, the Federal Reserve was born.
A crisis teaches you which institutions you lack. The Panic of 1907 taught America it needed a central bank.
