Remember the old stories that revolve around some big Victorian haunted house on the hill? How did that recurring theme enter into folklore, from old books to Scooby Doo to Scary Movie sequels?
An interesting note in Wikipedia I found inserts a tie-in between that often-repeated story in American folklore. Panic of 1893 - Wikipedia, the free encyclopedia
It came out of the aftermath of the Panic of 1893... the last time the country was mired in a gigantic real estate collapse.
Because of the lack of deposit insurance, a major explosion in the bond markets which wiped out many railroad companies (including the Reading Company). The companies which failed because they could not meet their debt payments spawned bank runs by spooked depositors. Because the entire banking system was interconnected (than, as it is now)... banks which loaned large sums of money to the failing railroad companies were sure to go under--which created a cycle of depositors withdrawing as much money as they could.
The value of silver, which was artificially inflated by forced U.S. Government purchases to please farmers who wanted to drive up inflation to lower the cost of their debts, collapsed. Foreigners then started cashing in their silver deposits as quickly as they could into US Dollars and then to convert that into gold. The US Mint could also not keep up with the demand for cash and there was no Fed to make overnight loans to banks or emergency reserves to maintain solvency. Tens of thousands of US companies went bankrupt within months.
Without deposit insurance, many commercial bank failures left a lot of upper-middle class citizens penniless and walking away from their big new, Victorian, houses. Because in the late 1900s these houses were so large and new and purchased with leverage---few could really come up the the cold hard cash to buy the houses after the crash because most of the population was shifted down two or three tax brackets. The cost and amount of anthracite coal needed to keep those houses warm in the winter was cost-prohibitive in and of itself.
And now you know where haunted houses came from.




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