The financial magnate and well known financier, John Pierpont Morgan, known the world over as J.P. Morgan, was born into a wealthy family in 1837 in New England. He went on to become one of the wealthiest businessmen in the world through his efforts in industrial consolidation and the founding of private banks and financial institutions in the late 1800s.
His father, Junius Spencer Morgan, was a successful businessman and partner in a dry goods company. His mother, Juliet Pierpont, was the daughter of a poet and preacher. Pierpont, as he was known, was a sickly child and spent most of his formative days indoors, visiting art galleries, no doubt where his appreciation for the arts developed. This love of the arts led to one of the largest private art collections in the world.
Marriage and Children
At the age of 24, Morgan married Amelia Sturges, the daughter of a wealthy businessman from New York. Unfortunately, Amelia died of tuberculosis just four months later. In 1865, Morgan married Frances Louisa Tracy. The couple would go on to have four children.
After spending his youth in Europe learning to speak both French and German, Morgan returned to the States where he began work as a clerk at Duncan, Sherman & Co., the American branch of his father’s firm. Morgan was a calculated risk taker and never missed an opportunity. While travelling for Duncan, Sherman & Co., he found himself in a position to purchase a shipment of coffee from a captain who had lost his buyer. Morgan used company money to buy the coffee and made a large profit from the deal. This success gave him the confidence to launch his own company, J. Pierpont Morgan & Co. in the early 1860s.
He was then able to take advantage of the boom in railroad expansion; companies were in over their heads with their finances stretched to the limit. Morgan managed to consolidate a number of railroads and gained control of railroad stocks, in time, claiming ownership of one-sixth of all America’s railroads.
He also oversaw the sale of 250,000 shares of stock in the New York Central Railroad — an enormous transaction that he managed to close without lowering the share price. This huge sale put him on the New York Central board of directors. He also completed a sale of $40 million in bonds to finance the Northern Pacific Railroad — at the time, the largest transaction of railroad bonds in U.S. history.
In 1891, he completed the purchase of Andrew Carnegie’s steel company for nearly $500 million. He funneled the profits into U.S. Steel and created the first billion-dollar corporation. In 1892, he successfully oversaw the merging of Edison General Electric and Thomson-Houston Company to form General Electric.
Savior or Sinner?
Morgan helped to bail out the United States several times, including in 1895 when he was instrumental in saving America’s gold standard and arranged loans to the federal government totaling more than $60 million. He also managed to convince other wealthy patrons to bail out a number of financial institutions, including the U.S treasury in 1895 and 1907, bringing stability to the market. Due to these actions, Morgan was lauded and celebrated, but the praise was short-lived. Morgan began to receive criticism from the public, press and government with accusations of impropriety and the control of financial markets, culminating in a call to testify before a congressional committee in 1912.
Morgan’s company has enjoyed a 150-year history in Houston, where the first bank was opened in 1866. In 1927, Morgan built a giant skyscraper to serve as home to JPMorgan Chase, which is still the headquarters to this day.
Later Years and Death
J.P. Morgan died in Rome, Italy at the age of 75. The New York Stock Exchange closed on the day of his funeral to honor an icon of finance. He left behind a financial success story in his international banking firm JPMorgan Chase & Co.
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