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This article is about the 1837–1913 American financier. For the modern company, see JPMorgan
Chase. For the historical banking institution, see J.P. Morgan & Co.. For other people of the same
name, see J. P. Morgan (disambiguation).
BORN:John Pierpont Morgan
April 17, 1837
Hartford, Connecticut, U.S.
DIED:March 31, 1913 (aged 75)
Rome, Italy
John Pierpont "J.P." Morgan (April 17, 1837 – March 31, 1913) was
an American financier, banker, philanthropist and art collector who dominated corporate
finance and industrial consolidation during his time. In 1892, Morgan arranged the merger
ofEdison General Electric and Thomson-Houston Electric Company to form General Electric.
After financing the creation of the Federal Steel Company, he merged it in 1901 with
the Carnegie Steel Company and several other steel and iron businesses, including
Consolidated Steel and Wire Company, owned by William Edenborn, to form the United States
Steel Corporation.
J.P. Morgan & Company
After the death of Anthony Drexel, the firm was rechristened "J. P. Morgan & Company" in 1895,
retaining close ties with Drexel & Company of Philadelphia; Morgan, Harjes & Company of Paris;
and J.S. Morgan & Company (after 1910 Morgan, Grenfell & Company), of London. By 1900, it
was one of the most powerful banking houses of the world, focused especially on
reorganizations and consolidations.[citation needed]
Morgan had many partners over the years, such as George W. Perkins, but always remained
firmly in charge. His process of taking over troubled businesses to reorganize them became
known as "Morganization."[4] Morgan reorganized business structures and management in order
to return them to profitability. His reputation as a banker and financier also helped bring
interest from investors to the businesses he took over.
Treasury gold
In 1895, at the depths of the Panic of 1893, the Federal Treasury was nearly out of gold.
President Grover Cleveland accepted Morgan's offer to join with the Rothschildsand supply the
U.S. Treasury with 3.5 million ounces of gold[6] to restore the treasury surplus in exchange for a
30-year bond issue. The episode saved the Treasury but hurt Cleveland's standing with the
agrarian wing of the Democratic Party, and became an issue in the election of 1896, when banks
came under a withering attack from William Jennings Bryan. Morgan and Wall Street bankers
donated heavily to Republican William McKinley, who was elected in 1896 and re-elected in
1900.
Newspapers
In 1896, Adolph Simon Ochs, who owned the Chattanooga Times, secured financing
from Morgan to purchase the financially struggling New York Times. The New York
Times became the standard for American journalism by investing in news gathering
and insisting on the highest quality of writing and reporting.
Steel
J. P. Morgan in his earlier years
After the death of his father in 1890, Morgan took control of J. S. Morgan & Co. (which was
renamed Morgan, Grenfell & Company in 1910). Morgan began talks with Charles M.
Schwab, president of Carnegie Co., and businessman Andrew Carnegie in 1900. The goal
was to buy out Carnegie's steel business and merge it with several other steel, coal, mining
and shipping firms to create theUnited States Steel Corporation. In 1901 U.S. Steel was the
first billion-dollar company in the world, having an authorized capitalization of $1.4 billion,
which was much larger than any other industrial firm and comparable in size to the largest
railroads.
U.S. Steel aimed to achieve greater economies of scale, reduce transportation and resource
costs, expand product lines, and improve distribution.[9] It was also planned to allow the
United States to compete globally with the United Kingdom and Germany. Schwab and others
claimed that U.S. Steel's size would allow the company to be more aggressive and effective in
pursuing distant international markets ("globalization").[9] U.S. Steel was regarded as
a monopoly by critics, as the business was attempting to dominate not only steel but also the
construction of bridges, ships, railroad cars and rails, wire, nails, and a host of other products.
With U.S. Steel, Morgan had captured two-thirds of the steel market, and Schwab was
confident that the company would soon hold a 75 percent market share.[9] However, after
1901 the business' market share dropped. Schwab resigned from U.S. Steel in 1903 to
form Bethlehem Steel, which became the second largest U.S. steel producer.
Morgan died while traveling abroad on March 31, 1913, just shy of his 76th birthday. He died in
his sleep at the Grand Hotel in Rome, Italy. Flags on Wall Street flew at half-staff, and the stock
market closed for two hours when his body passed through New York.[50]His remains were
interred in the Cedar Hill Cemetery in his birthplace of Hartford, Connecticut. His son, John
Pierpont "Jack" Morgan, Jr., inherited the banking business.[51] He bequeathed his mansion and
large book collections to the Morgan Library & Museum in New York.
At the time of his death, he held only 19% of his own net worth, an estate worth $68.3 million
($1.39 billion in today's dollars based on CPI, or $25.2 billion based on 'relative share of GDP'),
of which about $30 million represented his share in the New York and Philadelphia banks. The
value of his art collection was estimated at $50 million.