Jay Cook and Co had three main branches.

New York, he had his own partners.

They were very able, but they literally just ran out of money. They didn't have enough money to meet their own obligations. So the New York partners summon all the big counterparties among the big brokerage houses and investment banks on Wall Street and say, look, if we don't have a million dollars by 10 a.m., we're dead. Wow. Yeah. That's where you get the spooky music and dramatic music into the movie.

It is the moment, really. It electrified everybody. This was not a small bank. This was like a J.P. Morgan. Or a Goldman Sachs out of the blue suddenly saying, we're dead.

Today, on the story of money, what happens when an exciting new technology fuels an investment bubble, attracting a huge amount of money that eventually stages a spectacular

burst. Now, we could be talking about the present-day AI boom, but in fact, we're going to

bring you a story that took place 150 years ago. It's about the technology that first knitted

the US economy together, financed by an unprecedented accumulation

of debt. Vast fortunes were made as the market built up a head of steam before hitting the

buffers in one of the biggest financial panics in Wall Street history, one that derailed

the US economy for years afterwards. So if you still haven't figured

out which technology we're talking about, well, Robin, do you want to do the honours?

It's the railways, of course. Of course it is. And you care a lot about railways,

don't you? Well, the huge railway bond boom or the late 19th century is just a fascinating episode.

It's perhaps the most spectacular debt-field capital expenditure splurge in history.

Tens of thousands of miles of track was laid across the US from east to west, north to south,

and really kind of sets the path to the US becoming the world's mightiest economy.

And in many ways, the railway boom was also proof that you can have an amazing revolution

technology that seems good, but it doesn't mean that it's going to be a straight path forward

for finance. On the contrary, you can have some very damaging booms and busts. And that's got a lot of lessons for today's AI mania, which we'll be looking at in today's episode. But Robin, you're the one who's going to be talking about this most of all, because you've written the book on it, haven't you? Well, it's a chapter in a book. I'm writing a book on the history of the bond market and there's a chapter on the railway

bond boom of the 19th century because it's spectacular. It really is just a glorious,

demented period of finance and economic history, really. It was when railways really kind

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