Essay on JP Morgan\'s Life PDF

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Biography of JP Morgan Jessica Scot 11-18-15 John Tommasi Econ 401

“J.P. Morgan, the name synonymous with big business, developed a name early on as a ruthless, shrewd businessman –traits which all too often are required in order to run a successful business.” (J.P. Morgan – Civil War Corruption Leads to Big Business, smashtheman.com). John Pierpont Morgan, son of Junis and Juliet Morgan, was born on April 17, 1837 in Hartford, Connecticut. He died on March 31, 1913 in Rome, Italy of natural causes. (“JP Morgan Biography”, Bio.com). Morgan went to high school at Boston’s English High School, then furthered his education at the University of Gottingen in Germany. As a child JP’s father, Junius Morgan was a wealthy financier, having money in both America and Europe. His father taught him how he will have to at some point manage the family’s assets. ("John Pierpont Morgan | American Financier”, Britannica.com). His uncle, James L. Pierpoint, along with being a founder of Yale University also wrote the classic “Jingle Bells”. The song was originally considered a failure when it was first published, and was actually written about Thanksgiving. (“J.P. Morgan”, history.com). At 15 years old JP Morgan had been collecting different pieces of art as he traveled through different countries of Europe. Along with his interest in collecting art, in his free time he also enjoyed sailing. Along with that Morgan was also Morgan was deeply interested in the natural sciences. He was in fact a representative of the American Museum of Natural History for 44 years as well. Morgan was fluent in French as well as German, he was also submerged in literature. At age 20 he graduated from the University of Gottingen and started working at his father’s bank in London. Later moved to New York to start his job as an accountant for Duncan, Sherman & Co. This company was the American representative of the firm, George Paebody and Company, in London.

In 1861, JP became the manager of his father’s banking company in New York City. In this same year Morgan married Amelia Sturges, the daughter of a wealthy New York businessman. Sadly, Amelia passed away for months after marriage of tuberculosis, a very rare but serious infection affecting the lungs. (“JP Morgan Biography”, Bio.com). Three years later, he became a partner of the firm Dabney, Morgan and Company. In 1865 J.P. remarried to Frances Louisa Tracy, daughter of a New York lawyer. (“JP Morgan Biography”, Bio.com). The two later had four children together; J.P. Jr., Anne, Juliet, and Louisa. Then in 1871 he started as a member of Drexel, Morgan and Company. This firm was also located in New York City and it rapidly became the main source of the U.S. government financing. As of 1895, this firm was then known as J.P. Morgan and Company, and it became one of the most dominant banking houses out there. With his connections from the British bankers, J.P. was able to grow industrial companies of the United States in the 1870s. During all of this the Civil War was occurring, starting on April 12, 1861. Morgan realized that there was a major situation beginning, so he paired up with Arthur Eastman. The two then introduced a plan that would trick the United States government out of money and human lives. (J.P. Morgan – Civil War Corruption Leads to Big Business, smashtheman.com). Morgan then loaded $17,500 to Eastman who purchased 5,000 barley working rifles at $3.50 each from the United States Army. Then Arthur Eastman partnered up with Simon Stevens to start the next part of their plan. Simon Stevens then communicated with one of the Generals, and presented him 5,000 “new” rifles at $22.00 each. (J.P. Morgan – Civil War Corruption Leads to Big Business, smashtheman.com). The General was too concerned to turn down the offer, by the time the soldiers were given the weapons it was obvious that the soldiers would not survive. Because of this incident J.P. Later on, Morgan was then taken to court by the government. They

concluded that even though the weapons were not in good shape, the contract was valid. Morgan took over $100,000 throughout this whole scheme. He used the money to finance the multiple financial actions that lead up to his era. (J.P. Morgan – Civil War Corruption Leads to Big Business, smashtheman.com). By 1885 he was restructuring railroads, by starting an arrangement between the New York Central and the Pennsylvania Railroads. A year later he restructured two more railroads trying to stabilize their financial base. Throughout the times of reconstructing, he became a member of the board of directors of many railroads. J.P. Morgan was then addressed to improve more of the primary railroads in the United States. These railroads included; the Southern Railroad, the Erie Railroad, and the Northern Pacific. Morgan helped to reach railroad rate stability along with depressing the overall competition in the East. He then gained control of the stock of the railroads that he reconstructed and became one of the world’s most powerful railroad entrepreneurs by governing almost 5,000 miles of railroads by the year 1902. JP Morgan actually aided in ending the Panic of 1893, and then in 1895 assisted the United States out of a horrible two-year economic depression. The disaster all started from the railroad boom after the war that caused multiple banks to fail and run strictly on gold. J.P. then created an organization that resupplied the United States useless gold reserve with $62 million in gold to compensate for the crisis. A couple years passed and he now was financing a series of great industrial alliances that were to reshape the corporate structure of the American Manufacturing Sector. Morgan’s first project was to position the union of Edison General Electric and Thomson-Houston Electric Company to form General Electric, which then became the leading electrical-equipment industrial firm in the country. Thomas Edison announced his invention of electrical power on September 15, 1878. (American Experience: TV's Most-watched

History Series, pbs.org). The first electrical lights to be put into effect was on New Year’s Eve 1880 in New York, thousands of people gathered around in amazement. When Edison needed more money to continue his invention, the investors turned him down immediately. (American Experience: TV's Most-watched History Series, pbs.org). Edison continued on his own and on September 4, 1882 he had started America’s first power plant, targeting wealthy customers such as Morgan. In 1895, The New York firm was renamed to J.P. Morgan & Co, when Morgan became a senior partner. By 1901 Morgan produced the world’s initial billion-dollar company by buying out Andrew Carnegie and then merging with 33 companies to produce United States Steel. A year later he then brought together multiple of the primary agricultural-equipment producers to create the International Harvester Company. In 1903, he was part of the biggest real estate arrangement at the current time. Morgan was chosen by the United States treasury to organize the transmission of 40 million dollars from the United States government to the French Panama Canal Company. (“Company History”, jpmorgan.com). The financial panic of 1907 strikes, and J.P. Morgan could not have helped save the United States anymore, he protected multiple companies from bankruptcy along with saving the New York Stock Exchange. (“Company History”, jpmorgan.com). J.P. had full intentions of leaving in the middle of March for Europe, but there was rumor spreading about President Roosevelt making some drastic moves against the rail roads. This rumor forced Morgan to travel to Washington D.C. to discuss the “the present business situation with Roosevelt. (Trumbore). On March 12, the Dow Jones Industrial average was set at 86.53. A day later, the stock market started plummeting and closed at 83.12. One more day passes, March 14, the market then crashed, losing 8.3% of its value. (Trumbore). After this crisis, Morganand his partners from Wall Street created a rescue plan to help out the other trust institutions. This group of men then

met up with President Roosevelt’s treasury secretary, who gave the group $25 million to keep the structure from collapsing. They placed the large amount of money in the national banks in New York with the intentions of increasing capital to a system deeply in need of more liquidity. (Trumbore). It is now November, and the Dow Jones Industrial average had dropped a total of 39%. After this, J.P. Morgan made a $3 million plan to save it, the $25 million was then distributed out as necessary to keep the stock market from fully collapsing. (Trumbore). In 1912, J.P. was called to attest in front of a congressional committee directed by United States Representative, Arsene Pujo of Louisiana. He was investigating the presence of a “money trust”, a small group of exclusive Wall Street financiers, including Morgan, who supposedly conspired to help start the formation of the Federal Reserve System in 1913, along with encouraging the passage of the Clayton Antitrust Act of 1914. (“Company History”, jpmorgan.com). Also April of 1912 Morgan had a ticket for the original journey of the White Star’s Titanic, but luckily had to cancel because of a sickness. ("John Pierpont Morgan | American Financier”, Britannica.com). A year later, Morgan died leaving behind a legacy that would outline American business. J.P. Morgan & Company continued to flourish after his death. His son, John Pierpont Morgan Jr. took over his father’s leadership role of the bank. (Planes). Under John’s management, the Morgan bank grew into one of the most important financiers of World War I. The Great Depression and the following widespread financial improvements during when Franklin D. Roosevelt was president, severely hurt J.P. Morgan’s power. The Glass Steagall legislation, which referred to the four requirements of the United States Banking Act of 1933 that restricted commercial bank security activities and associations inside commercial banks and security firms later forced it out of the investment banking field. (Planes). Because of this, Henry Morgan, J.P. Morgan’s grandson, created Morgan Stanley in 1935. This new

investment bank instantly became a main participant on Wall Street. By the 1990s, J.P. Morgan had created itself a reputable but not too large bank. (Planes). In 2000 Chase Manhattan combined together with Morgan to then create JPMorgan Chase, which is now the largest bank by assets in the world. (Planes). Today, J.P. Morgan is still considered to be one of America’s leading businessmen, and known for helping to form the country into what it is today. J.P. Morgan lived a truly incredible and purposeful life. Fresh out of college at age 20, such a young age he had already started at his father’s firm. Then just a few years into the future he had already taking over his father’s bank. His father sculpted Morgan into the financially exquisite man he came to be. I believe J.P. Morgan’s life could have been very different if it wasn’t for his father pressuring him into following in his footsteps. It did in fact greatly benefit Morgan though, granting him respected across the nation and being known worldwide as one America’s greatest financiers. This is shown because even after his death his company is still currently present and used. Without the help of J.P. Morgan America would not be anywhere what it is currently like today.

Works Cited "American Experience: TV's Most-watched History Series." PBS. PBS, n.d. Web. 17 Nov. 2015. "Company History." Company History. JPMorgan Chase & Co, 2015. Web. 17 Nov. 2015. "John Pierpont Morgan | American Financier." Encyclopedia Britannica Online. Encyclopedia Britannica, 1 June 2015. Web. 17 Nov. 2015. "J.P. Morgan – Civil War Corruption Leads to Big Business." Smash the Man. Smash the Man, 19 Sept. 2009. Web. 18 Nov. 2015. "JP Morgan Biography." Bio.com. A&E Networks Television, n.d. Web. 17 Nov. 2015. "J.P. Morgan." History.com. A&E Television Networks, 2009. Web. 17 Nov. 2015. Levenick, Christopher. "The Philanthropy Hall of Fame | The Philanthropy Roundtable." The Philanthropy Hall of Fame | The Philanthropy Roundtable. Philanthropy Roundtable, 2015. Web. 17 Nov. 2015. Planes, Alex. "The Story of J.P. Morgan, the Most Powerful Bank in America." Fool. The Motley Fool, 2015. Web. 17 Nov. 2015. Trumbore, Brian. "Educate Yourself - J.P. Morgan - Savior -- The Panic of 1907." Buy and Hold. Freedom Investments, 2004. Web. 18 Nov. 2015....