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Investments and Business

How the collapse of speculative trusts triggered the 1907 liquidity crisis

How the collapse of speculative trusts triggered the 1907 liquidity crisis

1. The Panic of 1907: Birth of the Central Bank FrameworkThe Panic of 1907 began with the collapse of speculative trust companies in New York and quickly escalated into a nationwide liquidity crisis. With no central bank to act as a lender of last resort, financial markets relied...