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Panic of 1893
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| A growing credit shortage created panic, resulting in a depression. Over the course of this depression 15,000 businesses, 600 banks, and 74 railroads failed. There was severe unemployment and wide-scale protesting, which in some cases became very violent. |
The economic collapse of the Philadelphia and Reading Railroads was the first step toward the Panic of 1893. A growing depression in Europe resulted in British investors selling their American investments and redeeming them for gold. This fostered a growing American gold loss, creating a panic.
By May 15, stock prices reached an all-time low. Many major firms; such as the Union-Pacific, Northern-Pacific and Santa Fe railroads; were forced to declare bankruptcy. Unemployment steadily grew, rising from 1 million in August 1893 to 2 million by January 1894 By the middle of the year, the figure had reached 3 million.
The government had no plan to end the economic panic. Most relief for those without jobs was provided by local voluntary organizations, who were quite overwhelmed by the need. |
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