Panic of 1884

The panic created a credit shortage that led to a significant economic decline in the United States, turning a recession into a depression.

[2][4] The New York City national banks halted investments in the rest of the United States and called in outstanding loans.

The 1873 panic was caused by practices including speculative bonds and overextension of credit to fund the construction of infrastructure.

[8] In addition to capital from investors, the firm was financed in part by James Fish's Marine National Bank.

Another cause of the panic and mistrust in 1884 was John Chester Eno's embezzlement of over $3 million from the Second National Bank.

[12] The Clearing House advertised the solvency and loaned the bank $3 million so it could withstand the situation and not crash.

[12] Some accounts blamed the New York Clearinghouse's decision to stop publishing bank-specific information along with other actions since it is viewed to have alleviated the need for a suspension of convertibility.