Banks of the city of New York (collectively; except Chemical Bank)

Bank Information

Episode Type: Suspension → Reopening
Bank Type: state
Start Date: October 13, 1857
Location: New York, New York (40.714, -74.006)

Metadata

Model: gpt-5-mini
Short Digest: c659c69e

Response Measures

None

Description

Article (NY Herald 1858-10-14) states that twelve months earlier the New York city banks (except Chemical) unanimously agreed to suspend specie payments — a collective suspension around 1857-10-13 caused by a broad crisis tied to bank expansion and railway speculation (systemic). The piece implies recovery over the subsequent year (bank stocks near par), so classified as a suspension with successful reopening. Bank type is 'unknown' because the item refers collectively to multiple banks (mix of national/state). Date for the suspension is inferred as ~1857-10-13 from Twelve months ago this day.

Events (2)

1. October 13, 1857 Suspension

Cause: Macro News
Cause Details: Collective suspension during the national financial crisis driven by overexpansion of banks and corrupt/insane railway speculation (systemic financial crisis).
Newspaper Excerpt: Twelve months ago this day, the banks of the city of New York, with the single exception of the Chemical Bank, unanimously agreed to suspend specie payments.
Source: newspapers

2. October 13, 1858 Other

Newspaper Excerpt: Twelve months have elapsed since then... In bank stocks we note a large business, and an almost universal advance... the stock of all the leading banks is now either over or very near par; yet had the Judges done their duty, they would all have been wound up last fall.
Source: newspapers

Newspaper Articles (1)

1. October 14, 1858 The New York Herald New York, NY

Article from The New York Herald, October 14, 1858

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Article Text

FINANCIAL AND COMMERCIAL. WEDNESDAY, Oct. 13-6 P. M. Twelve months ago this day, the banks of the city of New York, with the single exception of the Chemical Bank, unanimously agreed to suspend specie payments. It was the culminating point of a crisis which had been mainly brought upon the country by the unwise expansion of those very banks, materially assisted, however, by the corrupt and insane speculation in railways. Both were linked together in the work of ruin. Without the bank expansion, the railways could not have borrowed as much money as they had, nor set afloat so many worthless securities; and without the railway speculation the banks would not have been tempted to expand to the point they did. It was the combined folly of the two that desolated the country. Twelve months have elapsed since then-to look at Wall street one might suppose it had been twelve years. With one or two exceptions, the stock of all the leading banks is now either over or very near par; yet had the Judges done their duty, they would all have been wound up last fall. In the railway world the contrast is equally striking. New York Central sells as high as it did before the revulsion; the change in the price of the leading Western stocks is hardly worth notice: Erie, Michigan Southern, Cleveland and Reading, Milwaukie and Mississippi, and nearly all the other companies whose condition was universally acknowledged to be hopeless last fall, are still alive, and still in demand at the Brokers' Board. Not one of them has lightened the load of debt which, in 1857, weighed it to the ground. A few have funded their floating debt at frightful sacrifices. Many have curtailed expenses by stopping the progress of essential repairs. Some have contrived, by the adoption of cunning expedients, and thanks to the cheapness of money, to carry their debt along. But not one out of the whole list has really struck at the root of the evils which broke down the system last year; not one has done the only thing that can afford permanent relief to the railway world-gone into liquidation, wiped out its stock, and reduced the capital on which interest is to be paid to a fair figure. On these roads, in a word, the lesson of the revulsion has been thrown away. Near as they were to total collapse last fall, they are now in full swing once more, and bankrupt presidents and ruined directors are once more trying to delude the public into losing more money in stocks and bonds. If they succeed and there are no limits to the folly of that class of persons who are called outside speculators in stocks-we are destined to see another brief period of inflation; another insane era, when men shall believe even in Erie and Michigan Southern; another period when dishonest reports and false accounts of earnings shall flourish; and, soon afterward, another terrible collapse in which ruin will travel from the railway world into the commercial world, and banks, merchants, manufacturers, and society generally, will be involved in disasters caused by the knavery of a few Wall street speculators. The business at the Stock Exchange to-day was lighter than yesterday. There were no prominent buyers or sellers. For State stocks and first class dividend paying property the demand was steady and large. Missouris were freely taken at both boards at an advance of ⅜ a ¼ per cent. Tennessees and other State stocks generally were steady. The same remark will apply to the railroad bonds, the better class of which, especially, attracted general attention. In bank stocks we note a large business, and an almost universal advance. American Exchange shares were ⅝ better, Commerce ¾, Continental 2 per cent, Hanover ¼, Importers' and Traders' 2 per cent, Metropolitan ⅜, &c. For dividend paying railways large prices were bid. For Cleveland, Painesville and Ashtabula 119½ was offered, and 117 for New Haven and Hartford. Passing from investment to speculative stocks, we find a less favorable market. New York Central opened dull and rather lower, but after the usual transactions between the bulls and bears it rallied to yesterday's price, and a shade above. Reading was also lower during the course of the day, but in the afternoon sold at yesterday's price. The Michigan shares were in fair demand throughout the day-Central a shade lower, the Southern both pretty firm. Rock Island was neglected, but closed without change of price. The last prices after the board were-Missouris 87⅜ a 87⅝; New York Central, 83¾ a 84; Reading, 51 a 51¼; Michigan Central, 56 a 56¼; Galena, 83 a 83½; Rock Island, 65⅜ a 65⅝; Pacific Mail, 103 a 103¼; Panama, 116¾ a 116⅞. The market closed firm.