The crisis of 1907 has been called a "'rich man's panic" and the of undigested securities.' Under the fostering protection of the high tariffs came the organization of numer ous consolidated corporations known as trusts, of which, according to one authority, 225 sprang into existence during 1899 to 1903. An era of prosperity set in but in 1906 the life insurance scandals and the subsequent investiga tions and legislation tended to throw discredit on some of the business methods in vogue. In spite of these revelations, the year 1906 was the most prosperous the country had known, crops being abundant, wages high, iron and steel production enormous, freight business beyond capacity, dividends earned on non-paying stocks and money plentiful for promoting any kind of speculative enterprise. By the end of the year, however, affairs began to take a down ward turn, due in part to the Lawson articles, in part to the prosecution of corporate interests by the Federal government under Roosevelt, in part to instability of the banking and currency system, in part to over-speculation and over expansion of business enterprises and various other causes, resulting in March 1907 in a gen eral unloading of speculative securities. Values continued to decline, producing a temporary stringency in August 1907, which was followed by the financial crisis of October, when several banking institutions of New York and Brooklyn suspended, to be followed by others in various sections of the country. In spite of the inabil ity of business men to obtain adequate financial accommodations, the number of failures was surprisingly small. The government aided the banks by depositing money, the clearing houses issued certificates, the importations of gold increased and confidence slowly returned, the normal level being reached again late in 1908, though the effects were apparent for a much longer time, even as late as 1912-13.
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