Financial markets in the years and months leading up to the financial crisis of 2007–08 were characterized by growth in the shadow banking sector, pyramiding and hidden leverage in the consumer and financial sectors, off-balance sheet financing by systemically important firms, and mortgage securitization and other “creative” financing schemes that some say resembled games of “hot potato” and “hide the sausage”. The failure of a prominent financial institution triggered an eventual full collapse in stock prices, resulting in, among other things, a foreclosure crisis with long-lasting negative spillovers into the real economy. Many believe the recent crisis to be unprecedented, where, for example, Hyun Song Shin (2010) wrote: “The global financial crisis that erupted in the summer of 2007 has the distinction of being the first post-securitization crisis in which banking and capital market developments have been clearly intertwined.” In this speech I will present research I am conducting on the US panic of 1857 that contradicts Professor Shin’s observation, where the 1857 panic bore eerie similarities to the more recent panic.2The older panic, which occurred almost exactly 150 years prior to the more recent panic, had, in addition to the factors noted above, global capital flows emanating primarily from England and the Continent with clearly intertwined banking and capital markets. And, although sub-prime mortgage lending and securitization were perhaps not as widespread as they were in the current crisis, they played a very central role in propagating the panic from a few strategically placed firms located near the frontier of the Old Northwest back east to New York City and Europe.