Financial Crisis
The construction of the railway was a steady process until 1873 when Jay Cooke, the main investor, went bankrupt. He had made poor financial decisions and had not realized the extreme expense of building a trans-continental railroad. The builders had laid the tracks from Saint Paul, Minnesota until Fargo, North Dakota when construction ceased.
Investors in Northern Pacific stock rushed to sell their shares once the company went bankrupt. This event was later nicknamed "The Panic of 1873."
Investors in Northern Pacific stock rushed to sell their shares once the company went bankrupt. This event was later nicknamed "The Panic of 1873."
"Most bondholders rushed to sell their holdings for whatever they could realize from them."
-Hiram M. Drache: "The Day of the Bonanza"
-Hiram M. Drache: "The Day of the Bonanza"