Here's an overview of the Bank Panic of 1907. Good reading for those interested in the current Bear Stearns / Hedge Fund / Merrill Lynch / CDO / Subprime debacle now firmly underway. Those who ignore history are doomed to repeat it...
The Panic of 1907, also known as the 1907 Bankers' Panic, was a financial crisis in the United States. The stock market fell nearly 50% from its peak in 1906, the economy was in recession, and there were numerous runs on banks and trust companies.
In March 1907, over-expansion and poor speculation led to a stock market crash. Money became extremely tight. A second crash occurred in October 1907. This time, the crash was directly precipitated by Heinze's brothers, who had used money borrowed from Knickerbocker Trust in a failed attempt to corner United Copper.