Curator’s Choice: The “Panic of 1873” in Vienna and the end of the “Gründerzeit”
Based on the exuberant optimism that underpinned industrialisation in the nineteenth century, more banks and companies were incorporated in Vienna after 1860 than ever before. There were virtually no state restrictions or controls. Although the Vienna Stock Exchange grew in international stature, the prevailing liberal economic policy also facilitated unsound business start-ups. Fuelled by well-funded investors, this house of cards built on speculation spectacularly collapsed just a few days after the opening of the Vienna World’s Fair in 1873.
The exhibition series Curator's Choice provides an insight into the history of Austrian securities.
It all began when the "k.k. privilegierte Oesterreichische Credit-Anstalt für Handel und Gewerbe" - one of the largest Austrian banks of the time - had all its stock exchange deposits closed following rumours from Paris and sold bonds amounting to twenty million guilders, which led to falling prices and ultimately to financial bottlenecks at the other banks.
Share prices collapsed amid a general bank run. Countless investors and bank customers rushed to empty their accounts or lost all their assets that day. More and more companies became insolvent, and confidence in the securities and shares of these newly founded companies evaporated.
The European economic crisis triggered by the collapse of the Vienna Stock Exchange lasted almost two decades. Higher prices led to increased social inequality and poverty in large parts of the population. Most recriminations were directed at financial institutions, and this, in turn, contributed to a rise in anti-Semitism. In 1875, the Vienna Stock Exchange Act regulating the stock market was passed, which remained in force more or less unaltered until the late twentieth century.
The exhibition showcase will be on display from 7 February 2024!
