"News by Telegraph. Finance at New Orleans."
Aside from advances in printing technology and the development of the steam railroad, the telegraph was the biggest technological influence on news media in antebellum America. From 1844, when the first message was sent by Samuel F. B. Morse (1791-1872) on an experimental line between Washington, D.C., and Baltimore, to 1861, when the first transcontinental line was completed, the rapid expansion of the telegraph network revolutionized the distribution of news. Many newspapers began to carry “News by Telegraph” sections.
One of the first national news events directly influenced by the telegraph was the Panic of 1857. Due to a confluence of national and international trends that were already causing economic strain—falling grain prices, United States cotton being undersold, overproduction of goods, overbuilding of railroads—the failure of the New York branch of the Ohio Life Insurance and Trust Company in August 1857 spurred the panic into life. It gained momentum as banks began to put restrictions on transactions. Investors took this as a sign that a larger economic disaster was looming and so began to make poor deals on stock sales or pull out of the stock market altogether. The loss of a ship in September carrying a large shipment of gold bound for eastern banks sealed the deal. By early October, panicked depositors were withdrawing money from banks, and news of bank and business failures and general economic chaos spread instantly throughout the United States via telegraph, further inflaming the panic.
Although the Northeast was hit hardest, the panic extended throughout the country and the resulting depression had global effects. The significant part the telegraph played in the rapid spread of economic news can be seen in this “News by Telegraph” section in the Richmond Whig from October 9. There is news about failures, suspensions, and financial plans in New York, the center of the crisis, but also news from New Orleans, Alexandria, and Philadelphia.