September 19, 2025 • 27 mins
On this episode of Our American Stories, of all the so-called “robber barons,” J.P. Morgan ranks as one of the most maligned. After all, he was one of the most powerful men in American history. At the height of the Gilded Age, he built a financial empire that made the Morgan family a dynasty. Twice, when the federal government faced collapse, it was Morgan who stepped in to stabilize the nation. Was he a robber baron or a captain of industry? His story shows how one man’s wealth and influence profoundly shaped the American economy, leaving a legacy that still looms large over Wall Street today.
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Episode Transcript
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Speaker 1 (00:10):
This is Lee Habib and this is our American Stories,
the show where America is the star and the American
people coming to you from the city where the West begins,
Fort Worth, Texas. Out of all of the so called
robber barons, JP Morgan ranks is one of the most maligned.
He is widely credited with having saved the US national
(00:31):
economy in general and the federal government in particular on
two separate occasions. Let's take a listen to the story.
Speaker 2 (00:42):
It was the eighteen hundreds, and in just thirty five
short years, America had grown into one of the most
powerful countries on the planet, fueled by a group of
visionaries who were building a better future. Cornelius Vanderbilt stopped
at nothing to connect the nation by a railroads. John D.
Rockefeller lit homes from coast to coast cheaply and safely
(01:06):
with his standard oil. Under the strength of Andrew Carnegie,
steel cities expanded to the sky and bridges tightened a nation,
And because of JP Morgan's business sense and vision, electricity
began powering America. But what exactly did JP Morgan do
(01:26):
and why is it that we all know this man's name?
Speaker 3 (01:31):
You look at JP Morgan the way he controlled the
banking system. Basically, there's one man who just literally dominated
the banking industry and essentially dominated financing in the country.
Speaker 2 (01:44):
JP was a banker, a very powerful one who pulled
the financial strings of wealthy men and was called on
by presidents for what we now know as a bell out.
He was a man who brought order to chaos, a
man who made up fortune consolidating broken industries, buying out
failing companies and returning them to profitability. Twice he was
(02:08):
called on by American presidents to save the nation's economy.
Both times he was criticized for wielding the power for
the ability to do so. He was physically large, with
massive shoulders, piercing black eyes that seemed to look through people.
He had an enormously disfigured purple nose because of a
(02:28):
chronic skin condition called roseatia. As a result, all of
his professional portraits were retouched. Photographer Edward Steiken said meeting
his blazing dark eyes was like confronting the headlights of
a freight train bearing down on you. In eighteen thirty seven,
(02:50):
the new steam engine was beginning to transform America, creating
new and exciting opportunities. It was into this world of
possibility that John Pierpont Morgan was born on April seventeenth
in Hartford, Connecticut, the eldest son of Junius Spencer Morgan,
the legendary founder of the world's first modern investment bank,
(03:12):
and Juliette Pierpont Morgan, the daughter of a fiery preacher.
Young Pierpont was greatly influenced by both his grandfathers. Every
Sunday he accompanied his grandfather, Joseph Morgan to the local
Episcopal church. Pierpont loved the services, especially when it came
to singing the hymns. His other grandfather, the Reverend John Pierpont,
(03:37):
was known for his passionate sermons on man's depravity and
the love of Christ. Here's historian Ron Chernaut.
Speaker 4 (03:44):
From his Pierpont grandfather, Morgan got a streak of romanticism,
a streak of morality, and even a certain crusading streak
that would be very important in his life.
Speaker 2 (03:55):
From the time he could count, Pierpont was taught that
there was only one way to do business, the Morgan way.
Simply put, invest wisely, avoid risk. Pierpont was a relatively
solitary child who preferred reviewing his father's account books to
outdoor sports. Pierpont's father noticed his son's abilities, and over
(04:18):
the years groomed him for a career in business.
Speaker 5 (04:21):
He raised his son, Pierpont, with a great deal of love,
but also a great deal of discipline. Junius Bence Morgan
expected that his son would follow in his footsteps and
succeed in the business world.
Speaker 2 (04:34):
But illness plagued Pierpont and often kept him out of school.
Speaker 4 (04:38):
From the time that he was a boy. He really
had two personalities. One was this very jolly animated, high spirited,
outgoing boy with tremendous energy and health. But then he
would suddenly get these fainting spells, and that was accompanied
by a personality that was more that of a brooding loner.
Speaker 2 (04:57):
Forced by illness to spend time alone. Pierpont perfected the
game of solitaire, a game he played to relax when
he felt tense or nervous. After his first year at college,
Pierpont's father decided it was time for his twenty year
old son to begin his career and arranged for him
to be given a job as a clerk in a
(05:19):
Wall Street banking firm. He worked hard, was orderly, and
absolutely methodical, and he could add numbers with lightning speed.
Heer's historian H. W.
Speaker 6 (05:30):
Brands, JP Morgan understood the game, and at some point
he realized that as successful as his father had been,
he could become even more successful.
Speaker 2 (05:41):
At this time, Pierpont was introduced to a young lady
named Amelia Sturgis or Mimi, and they began dating. Soon,
Pierpont was sent to New Orleans, where he stumbled upon
a business opportunity that he couldn't resist. A local sea
captain was stuck with a shipload of coffee and no buyer.
(06:02):
Immediate action was required or the coffee would spoil. Using
the firm's money, Pierpont purchased the coffee and managed to
turn a tidy little profit in the process. In New York,
the partners at the bank weren't impressed. They were angry
and thought the venture was risky. But Morgan believed that
(06:22):
fortune smiles on those who act fast, and he believed
his instincts about people would always make him a winner.
Speaker 7 (06:30):
Said the real risk was that he had misjudged the
character of the captain and that the captain would have
lied to him. And this is sort of the quintessential
issue of Morgan, that he was able to look at
people and immediately make a judgment of their character and
of their integrity and one of his greatest strengths.
Speaker 1 (06:56):
And you've been listening to the story of JP Morgan,
and you may have ideas about who Morgan was, and
you may indeed have ideas about the Robert Barons in general.
I mean, the tagline alone is enough to make people
hate these men, but there's also much to know and
much to appreciate, and we're learning more about what JP
(07:16):
Morgan did his contribution to the building of modern America
when we return more of the story of JP Morgan
on Our American Stories. Leehabib here, as we approach our
nation's two hundred and fiftieth anniversary, I'd like to remind
you that all the history stories you hear on this
(07:37):
show brought to you by the great folks at Hillsdale College,
and Hillsdale isn't just a great school for your kids
or grandkids to attend, but for you as well. Go
to Hillsdale dot edu to find out about their terrific
free online courses. Their series on communism is one of
the finest I've ever seen. Again, go to Hillsdale dot
edu and sign up for their free and terrific online courses.
(08:09):
And we continue with our American stories and the story
of J. P.
Speaker 8 (08:13):
Morgan.
Speaker 1 (08:14):
Let's pick up where we last left off.
Speaker 2 (08:20):
During the summer of eighteen sixty one, three years after
they had met, Mimi was diagnosed with tuberculosis, almost always
fatal in the nineteenth century. Pierpont was devastated. Immediately, he
took control of the situation. He proposed to Mimi, promising
her that he'd help find a cure.
Speaker 5 (08:42):
He married her in the family house in New York.
In fact, he had to carry her downstairs for the ceremony.
Speaker 2 (08:49):
Pierpont immediately took Mimi to Algiers for their honeymoon. He
thought the tropical climate might save her. When Mimi's condition worsened,
he brought in the best specialists to attend to her,
but his efforts were in vain. Four months after their marriage,
on February seventeenth, eighteen sixty two, Mimi died in Pierpont's arms.
Speaker 9 (09:12):
He was an extraordinary outpouring of somebody trying to control life.
Speaker 2 (09:16):
In some way.
Speaker 9 (09:17):
It was a terrible loss for him, and he failed,
but he knew what he was getting into. Oddly enough,
he was daring, and almost he was daring death in
some sort of dramatic way and attempting to control it.
Speaker 2 (09:29):
The ordered, controlled life that Pierpont had made for himself
was turned upside down. He returned to New York a
changed man.
Speaker 5 (09:37):
The loss was so powerful that, in a way, it
forced him to keep his genuinely emotional nature under type control.
Speaker 2 (09:48):
Pierpont immersed himself in his business. He also remembered the
comfort he received while attending church as a young boy.
He joined Saint George's Church in Manhattan and became an
actor member As he continued to grieve for Mimi. The
church provided a type of redemption that Pierpont didn't expect.
(10:08):
It was there where he met the young, beautiful Fanny Tracy.
She was at first put off by Pierpont's gruff demeanor,
but soon she warmed to his affections. After a year
long courtship, Pierpont and Fanny were married at Saint George's
Church on May thirty first, eighteen sixty five, they had
(10:31):
three daughters and one son. Pierpont's prospects were bright. At
thirty three, he had a beautiful family, a yacht, two homes,
and was earning more than seventy five thousand dollars a year,
a huge amount in a time when two thousand dollars
was a comfortable living Then, like the discovery of fire
(10:54):
and the invention of the wheel, Morgan envisioned electric light,
revolutionizing the word. Morgan hired Thomas Edison, a telegraph boy
turned inventor, to install electricity at his Manhattan mansion on
two nineteen Madison Avenue, the first electrically lit home in
the world.
Speaker 10 (11:15):
Ladies and gentlemen, behold a miracle of modern science. The
gas lamp is dead, Long live the electric light.
Speaker 2 (11:39):
Morgan's home became a lab for Edison's experiments, and when
the time came to showcase electric light to a group
of potential investors, Pierrepont's father was not impressed. Though his father, Junius,
saw electric light as a risky fad, Morgan invested everything
(11:59):
in at In the end, the fruits of Morgan's insight
and investment gave birth to a company called General Electric.
At this point, Morgan was running the biggest investment bank
in America and consolidated both the electricity and railroad industries.
(12:20):
He controlled one hundred thousand miles of railroad, half the
country's mileage. But the American economy was fragile, and in
eighteen ninety three, the stock market crashed the nation was
thrown into a devastating depression. More than one hundred railroads
declared bankruptcy, causing a domino effect that threatened other businesses
(12:43):
and promised complete collapse of the economy. As had happened
in the past, powerful men called upon Pierpont Morgan to
bail them out.
Speaker 11 (12:53):
He excelled at taking warring parties who were destroying an
industry and bringing peace on terms that was suitable to them,
profitable to him, and which gave him leverage in the
business itself. Anyone who knew anything about him realized that,
like him or not, he got things done.
Speaker 2 (13:15):
Morgan reorganized the railroads by streamlining operations, and he was
quickly able to reverse the downward spiral. But Pierpont wasn't finished.
As a result of the depression of eighteen ninety three,
the federal government's gold reserves had dropped to such an
alarmingly low level that it looked as though the United
States government would go broke. Fortunately, writes Philandshoots, Morgan considered
(13:42):
the United States too big to fail, so Morgan devised
a plan in which American and European bankers would invest
gold directly in the government, saving it from collapse. But
President Cleveland rejected Morgan's plan, and instead he backed the
plan to raise the money by selling bonds directly to
(14:03):
the public. But Morgan knew that the government didn't have
time to sell bonds. Morgan quickly took a train to Washington,
but was told that the President would not see him.
Morgan's reply was swift, I have come down to Washington,
d C. To see the President, and I'm going to
stay here until I see him.
Speaker 5 (14:24):
I think Pierpont Morgan certainly felt that he was the
equal of the President of the United States.
Speaker 2 (14:30):
The next morning, word came from the White House that
Morgan would be received. The President implemented Morgan's plan, and
within days the economy recovered. Here's Alan Greenspan.
Speaker 8 (14:42):
Morgan obviously was looking at the national interest in the
context of his own, that is, saving the US treasury
was an active basic self interest, but it was an
active nationalism.
Speaker 2 (14:59):
Morgan was hailed as a hero. He was praised for
his patriotism and selflessness. But like all good deeds, Morgan's
didn't go unpunished. Some accused him of manipulating the government
and collecting a prophet.
Speaker 7 (15:14):
People began to decide that Pierpont had too much power
to be able to save the government of the United
States an extraordinary thing, and therefore the only way that
he could have done it is by having some sort
of evil capability.
Speaker 2 (15:31):
With the chaos, uncertainty, and personal demonization that often plagued
Morgan's life, there was one source of stability. Saint George's church.
The Reverend Rainsford said, sometimes I found him kneeling in prayer,
or reading or singing a hymn without organ and alone.
(15:54):
No one but myself knew that the great Master of
men and things was worshiping. But this great Master of
men and things had another side. Morgan was known for
enormous appetites.
Speaker 4 (16:10):
He consumed enormous quantities of port, sherry and wine with dinner.
He had breakfasts so large that could have killed a horse.
Speaker 2 (16:19):
His appetites extended to other areas as well. He was
often seen in the company of women other than his wife.
Speaker 4 (16:27):
Pierpont once made a very talent comment that there are
always two reasons why a man does something, a good
reason and the real reason. And he was always very
respectful of Fanny. He was very discreet about the various
escapades that he went through.
Speaker 1 (16:49):
And you've been listening to the story of JP Morgan,
and in the beginning of this segment we learned about
him losing the love of his life to tuberculosis, which
at the time was a death sentence. He joined Saint
George's Church where he find solace, redemption and also his
future wife. But it was his vision of electric light
(17:12):
illuminating not just America but the world, and his huge
investment empowering America with light that led to his great fortune.
And he backed Edison and actually, well he had the
first electrically lit home in the world. That's how much
he believed. And that investment parleyed into and turned into
(17:37):
General Electric, a company we all know. When we come back.
More of the story of JP Morgan, the good and
the bad, the visionary and the investment banker. Here on
our American stories, and we continue with our American stories
(18:10):
and the story of JP Morgan. Let's pick up where
we last left off.
Speaker 2 (18:16):
Morgan's passionate nature extended to his business enterprises. In nineteen
oh one, he undertook the largest business transaction in modern history,
the purchase of Carnegie Steel. Carnegie Steele was the crown
jewel in the Morgan Empire. When asked his name is Price,
Andrew Carnegie jotted down a figure on the back of
(18:38):
an envelope.
Speaker 12 (18:39):
Carnegie wasn't going to do any price haggling with Morgan.
Carnegie writes down four hundred and eighty million on a
piece of paper. It's the equivalent of four hundred billion today,
more than Gates and Buffett together.
Speaker 2 (18:54):
Carnegie dared JP Morgan to buy him out for an
outrageous price, a sum that is higher than the entire
budget of the US federal government. Telling the answer yes,
the deal was closed without lawyers and without a written contract.
(19:17):
The agreement gave Carnegie a personal net worth of over
three hundred and ten billion dollars in today's money, the
largest private fortune the modern world has ever seen. With
Carnegie Steel under his belt, Morgan formed the United States
Steel Corporation. In March of nineteen oh one, stock was
(19:39):
valued at one billion, four hundred million dollars. Morgan had
created the world's first billion dollar corporation, but his enormous
power now brought public scrutiny.
Speaker 4 (19:52):
After his creation of US Steel, he controlled somewhere between
sixty and seventy percent of the American steel industry. He
controlled a thread of American railways at a time when
railway stocks comprised sixty percent of all the stocks on
the New York Stock Exchange.
Speaker 2 (20:10):
Morgan had reached the pinnacle of his power, and it
looked as if nothing could stop him. At the turn
of the century, Morgan, along with John D. Rockefeller and
Andrew Carnegie, joined forces in launching the business friendly William
McKinley into the position of President of the United States.
(20:35):
But on September sixth, nineteen oh one, McKinley was cut
down by an assassin's bullet and died. Eight days later,
Vice President Theodore Roosevelt was sworn in as the next president. Now,
let's get started. Morgan soon confronted a man whose power
(20:55):
equaled his own.
Speaker 4 (20:56):
He was an unknown end today, but to the extended
people in New York knew his record. They also knew
that he was something of a loose cannon who had
gone on record as criticizing businessman.
Speaker 2 (21:10):
Roosevelt was determined to break up the big powerful businesses
called trusts, and he used Morgan's railroad company to set
the example.
Speaker 6 (21:19):
Morgan demanded to see the President, so he stormed down
from New York to Washington, went into the White House
and he said, I don't understand. He said, if we've
got a problem, send your man to my man and they'll.
Speaker 2 (21:30):
Fix it up.
Speaker 6 (21:31):
And Roosevelt said, this is exactly the problem with Morgan.
He acts as though I'm just a rival boss or something.
And Morgan, who thought that he could manipulate Roosevelt, discovered
that Roosevelt could not be manipulated at all.
Speaker 2 (21:47):
Morgan was not impressed.
Speaker 5 (21:49):
Pripont Morgan resented Theodore Roosevelt. Finally, and once, when he
heard that Roosevelt was going off to Africa on a safari,
Morgan said, good, the first line that meets him does
his duty.
Speaker 2 (22:07):
Morgan was prosecuted for breach of the Anti Trust Act
and lost in a five to four decision at the U. S.
Supreme Court. In nineteen oh three. Then in the fall
of nineteen oh seven, another panic hit Wall Street. One
of America's largest trust companies had collapsed, sending shockwaves throughout
the American economy. Immediate action was required, and President Roosevelt's
(22:32):
advisors knew that there was only one man with the
power to save the nation.
Speaker 11 (22:37):
Morgan's reach was very broad in American industry. He becomes
the most respected, reliable, and trusted figure, not only because
of the power and wealth and he wheels, but just
because of his character.
Speaker 2 (22:52):
The President, who had prosecuted Morgan for having too much control,
was about to hand that control back to him, and
Morgan had a plan. His answer was to get the
larger trusts to invest money in their weaker competitors. This
wasn't easy, but Morgan's power of persuasion was unmatched.
Speaker 4 (23:14):
Morgan was a very flamboyant and almost operatic figure, and
like well great actors, he liked to have great stage
sets for his big set pieces. He found it very
often in order to get a business deal. It helped
to isolate people and who also to set a deadline.
Speaker 2 (23:33):
He gathered the trust company presidents in his library. He
cast a long penetrating look at each man, and launched
into a plea for cooperation that at times sounded more
like a command. Morgan then walked to the front door
of the library, locked it, and retired to another room
to play solitaire. The nation's most influential men were locked
(23:57):
in Morgan's library and weren't allowed until they came up
with a solution.
Speaker 7 (24:02):
And he would be sitting at the desk and he
would be flipping his cards, and one of his lieutenants
would come in and say, mister Morgan, the bank presidents
have reposed a ten million dollar loan. And he would
be flipping his cards, and he would look up and
he would say it's not enough. It's like his cards. Again.
Speaker 2 (24:25):
In the early hours of the morning, Morgan marched into
the library. The men still had not come to a solution,
but Morgan had. He pushed a contract and a pen
into the hand of the leader of the trust company presidents.
He pointed to the contract and said, here's the place,
and here's the pen. Completely exhausted and beaten down, the
(24:49):
president signed and the others followed. The men agreed to
contribute to the twenty five million dollar pool to save
the week in trusts. Within day, the economy rallied, vowing
to never let it happen again, and realizing that in
a future crisis there was unlikely to be another Morgan,
(25:11):
The banking and political leaders devised a plan that resulted
in the creation of the Federal Reserve system in nineteen thirteen.
Here's Ron Chernaut.
Speaker 4 (25:20):
Prior to nineteen thirteen, we did not have a federal
Reserve Board in this country.
Speaker 8 (25:25):
We had J.
Speaker 4 (25:25):
Pierpont Morgan. He was like a one man central bank.
Speaker 2 (25:35):
On the morning of April fifteenth, nineteen twelve, Morgan was
scheduled to travel on the ill fated maiden voyage of
the RMS Titanic, but canceled at the last minute. The
White Star Line, which operated Titanic, was part of Morgan's
International Mercantile Marine Company, and Morgan was to have his
own private suite and promenade deck on the ship. In
(25:59):
response to the sinking of Titanic, Morgan purportedly said, monetary
losses amounts to nothing in life. It is the loss
of life that counts. It is that frightful death. On
March thirty first, nineteen thirteen, he died in his sleep
in a hotel in Rome, just short of his seventy
(26:22):
sixth birthday. Jay Pierpont Morgan used his integrity and his
influence to transform Wall Street at the turn of the century.
In the process, he changed America forever.
Speaker 1 (26:38):
And a terrific job on the production, editing and storytelling
by our own Greg Engler. And what a story you heard,
What a complicated and counterintuitive story. After all you'd ever
heard about the robber barons, particularly JP Morgan, you have
to rethink just about everything. What he did with Carnegie
would simply make the large business transaction and history. Carnegie
(27:02):
wrote down an epic number four hundred and eighty million dollars,
and there was no counter JP Morgan paid the full
amount and formed US steal the first billion dollar corporation
in America. The story of JP Morgan here on our
American Stories
This is Lee Habib and this is our American Stories,
the show where America is the star and the American
people coming to you from the city where the West begins,
Fort Worth, Texas. Out of all of the so called
robber barons, JP Morgan ranks is one of the most maligned.
He is widely credited with having saved the US national
(00:31):
economy in general and the federal government in particular on
two separate occasions. Let's take a listen to the story.
Speaker 2 (00:42):
It was the eighteen hundreds, and in just thirty five
short years, America had grown into one of the most
powerful countries on the planet, fueled by a group of
visionaries who were building a better future. Cornelius Vanderbilt stopped
at nothing to connect the nation by a railroads. John D.
Rockefeller lit homes from coast to coast cheaply and safely
(01:06):
with his standard oil. Under the strength of Andrew Carnegie,
steel cities expanded to the sky and bridges tightened a nation,
And because of JP Morgan's business sense and vision, electricity
began powering America. But what exactly did JP Morgan do
(01:26):
and why is it that we all know this man's name?
Speaker 3 (01:31):
You look at JP Morgan the way he controlled the
banking system. Basically, there's one man who just literally dominated
the banking industry and essentially dominated financing in the country.
Speaker 2 (01:44):
JP was a banker, a very powerful one who pulled
the financial strings of wealthy men and was called on
by presidents for what we now know as a bell out.
He was a man who brought order to chaos, a
man who made up fortune consolidating broken industries, buying out
failing companies and returning them to profitability. Twice he was
(02:08):
called on by American presidents to save the nation's economy.
Both times he was criticized for wielding the power for
the ability to do so. He was physically large, with
massive shoulders, piercing black eyes that seemed to look through people.
He had an enormously disfigured purple nose because of a
(02:28):
chronic skin condition called roseatia. As a result, all of
his professional portraits were retouched. Photographer Edward Steiken said meeting
his blazing dark eyes was like confronting the headlights of
a freight train bearing down on you. In eighteen thirty seven,
(02:50):
the new steam engine was beginning to transform America, creating
new and exciting opportunities. It was into this world of
possibility that John Pierpont Morgan was born on April seventeenth
in Hartford, Connecticut, the eldest son of Junius Spencer Morgan,
the legendary founder of the world's first modern investment bank,
(03:12):
and Juliette Pierpont Morgan, the daughter of a fiery preacher.
Young Pierpont was greatly influenced by both his grandfathers. Every
Sunday he accompanied his grandfather, Joseph Morgan to the local
Episcopal church. Pierpont loved the services, especially when it came
to singing the hymns. His other grandfather, the Reverend John Pierpont,
(03:37):
was known for his passionate sermons on man's depravity and
the love of Christ. Here's historian Ron Chernaut.
Speaker 4 (03:44):
From his Pierpont grandfather, Morgan got a streak of romanticism,
a streak of morality, and even a certain crusading streak
that would be very important in his life.
Speaker 2 (03:55):
From the time he could count, Pierpont was taught that
there was only one way to do business, the Morgan way.
Simply put, invest wisely, avoid risk. Pierpont was a relatively
solitary child who preferred reviewing his father's account books to
outdoor sports. Pierpont's father noticed his son's abilities, and over
(04:18):
the years groomed him for a career in business.
Speaker 5 (04:21):
He raised his son, Pierpont, with a great deal of love,
but also a great deal of discipline. Junius Bence Morgan
expected that his son would follow in his footsteps and
succeed in the business world.
Speaker 2 (04:34):
But illness plagued Pierpont and often kept him out of school.
Speaker 4 (04:38):
From the time that he was a boy. He really
had two personalities. One was this very jolly animated, high spirited,
outgoing boy with tremendous energy and health. But then he
would suddenly get these fainting spells, and that was accompanied
by a personality that was more that of a brooding loner.
Speaker 2 (04:57):
Forced by illness to spend time alone. Pierpont perfected the
game of solitaire, a game he played to relax when
he felt tense or nervous. After his first year at college,
Pierpont's father decided it was time for his twenty year
old son to begin his career and arranged for him
to be given a job as a clerk in a
(05:19):
Wall Street banking firm. He worked hard, was orderly, and
absolutely methodical, and he could add numbers with lightning speed.
Heer's historian H. W.
Speaker 6 (05:30):
Brands, JP Morgan understood the game, and at some point
he realized that as successful as his father had been,
he could become even more successful.
Speaker 2 (05:41):
At this time, Pierpont was introduced to a young lady
named Amelia Sturgis or Mimi, and they began dating. Soon,
Pierpont was sent to New Orleans, where he stumbled upon
a business opportunity that he couldn't resist. A local sea
captain was stuck with a shipload of coffee and no buyer.
(06:02):
Immediate action was required or the coffee would spoil. Using
the firm's money, Pierpont purchased the coffee and managed to
turn a tidy little profit in the process. In New York,
the partners at the bank weren't impressed. They were angry
and thought the venture was risky. But Morgan believed that
(06:22):
fortune smiles on those who act fast, and he believed
his instincts about people would always make him a winner.
Speaker 7 (06:30):
Said the real risk was that he had misjudged the
character of the captain and that the captain would have
lied to him. And this is sort of the quintessential
issue of Morgan, that he was able to look at
people and immediately make a judgment of their character and
of their integrity and one of his greatest strengths.
Speaker 1 (06:56):
And you've been listening to the story of JP Morgan,
and you may have ideas about who Morgan was, and
you may indeed have ideas about the Robert Barons in general.
I mean, the tagline alone is enough to make people
hate these men, but there's also much to know and
much to appreciate, and we're learning more about what JP
(07:16):
Morgan did his contribution to the building of modern America
when we return more of the story of JP Morgan
on Our American Stories. Leehabib here, as we approach our
nation's two hundred and fiftieth anniversary, I'd like to remind
you that all the history stories you hear on this
(07:37):
show brought to you by the great folks at Hillsdale College,
and Hillsdale isn't just a great school for your kids
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(08:09):
And we continue with our American stories and the story
of J. P.
Speaker 8 (08:13):
Morgan.
Speaker 1 (08:14):
Let's pick up where we last left off.
Speaker 2 (08:20):
During the summer of eighteen sixty one, three years after
they had met, Mimi was diagnosed with tuberculosis, almost always
fatal in the nineteenth century. Pierpont was devastated. Immediately, he
took control of the situation. He proposed to Mimi, promising
her that he'd help find a cure.
Speaker 5 (08:42):
He married her in the family house in New York.
In fact, he had to carry her downstairs for the ceremony.
Speaker 2 (08:49):
Pierpont immediately took Mimi to Algiers for their honeymoon. He
thought the tropical climate might save her. When Mimi's condition worsened,
he brought in the best specialists to attend to her,
but his efforts were in vain. Four months after their marriage,
on February seventeenth, eighteen sixty two, Mimi died in Pierpont's arms.
Speaker 9 (09:12):
He was an extraordinary outpouring of somebody trying to control life.
Speaker 2 (09:16):
In some way.
Speaker 9 (09:17):
It was a terrible loss for him, and he failed,
but he knew what he was getting into. Oddly enough,
he was daring, and almost he was daring death in
some sort of dramatic way and attempting to control it.
Speaker 2 (09:29):
The ordered, controlled life that Pierpont had made for himself
was turned upside down. He returned to New York a
changed man.
Speaker 5 (09:37):
The loss was so powerful that, in a way, it
forced him to keep his genuinely emotional nature under type control.
Speaker 2 (09:48):
Pierpont immersed himself in his business. He also remembered the
comfort he received while attending church as a young boy.
He joined Saint George's Church in Manhattan and became an
actor member As he continued to grieve for Mimi. The
church provided a type of redemption that Pierpont didn't expect.
(10:08):
It was there where he met the young, beautiful Fanny Tracy.
She was at first put off by Pierpont's gruff demeanor,
but soon she warmed to his affections. After a year
long courtship, Pierpont and Fanny were married at Saint George's
Church on May thirty first, eighteen sixty five, they had
(10:31):
three daughters and one son. Pierpont's prospects were bright. At
thirty three, he had a beautiful family, a yacht, two homes,
and was earning more than seventy five thousand dollars a year,
a huge amount in a time when two thousand dollars
was a comfortable living Then, like the discovery of fire
(10:54):
and the invention of the wheel, Morgan envisioned electric light,
revolutionizing the word. Morgan hired Thomas Edison, a telegraph boy
turned inventor, to install electricity at his Manhattan mansion on
two nineteen Madison Avenue, the first electrically lit home in
the world.
Speaker 10 (11:15):
Ladies and gentlemen, behold a miracle of modern science. The
gas lamp is dead, Long live the electric light.
Speaker 2 (11:39):
Morgan's home became a lab for Edison's experiments, and when
the time came to showcase electric light to a group
of potential investors, Pierrepont's father was not impressed. Though his father, Junius,
saw electric light as a risky fad, Morgan invested everything
(11:59):
in at In the end, the fruits of Morgan's insight
and investment gave birth to a company called General Electric.
At this point, Morgan was running the biggest investment bank
in America and consolidated both the electricity and railroad industries.
(12:20):
He controlled one hundred thousand miles of railroad, half the
country's mileage. But the American economy was fragile, and in
eighteen ninety three, the stock market crashed the nation was
thrown into a devastating depression. More than one hundred railroads
declared bankruptcy, causing a domino effect that threatened other businesses
(12:43):
and promised complete collapse of the economy. As had happened
in the past, powerful men called upon Pierpont Morgan to
bail them out.
Speaker 11 (12:53):
He excelled at taking warring parties who were destroying an
industry and bringing peace on terms that was suitable to them,
profitable to him, and which gave him leverage in the
business itself. Anyone who knew anything about him realized that,
like him or not, he got things done.
Speaker 2 (13:15):
Morgan reorganized the railroads by streamlining operations, and he was
quickly able to reverse the downward spiral. But Pierpont wasn't finished.
As a result of the depression of eighteen ninety three,
the federal government's gold reserves had dropped to such an
alarmingly low level that it looked as though the United
States government would go broke. Fortunately, writes Philandshoots, Morgan considered
(13:42):
the United States too big to fail, so Morgan devised
a plan in which American and European bankers would invest
gold directly in the government, saving it from collapse. But
President Cleveland rejected Morgan's plan, and instead he backed the
plan to raise the money by selling bonds directly to
(14:03):
the public. But Morgan knew that the government didn't have
time to sell bonds. Morgan quickly took a train to Washington,
but was told that the President would not see him.
Morgan's reply was swift, I have come down to Washington,
d C. To see the President, and I'm going to
stay here until I see him.
Speaker 5 (14:24):
I think Pierpont Morgan certainly felt that he was the
equal of the President of the United States.
Speaker 2 (14:30):
The next morning, word came from the White House that
Morgan would be received. The President implemented Morgan's plan, and
within days the economy recovered. Here's Alan Greenspan.
Speaker 8 (14:42):
Morgan obviously was looking at the national interest in the
context of his own, that is, saving the US treasury
was an active basic self interest, but it was an
active nationalism.
Speaker 2 (14:59):
Morgan was hailed as a hero. He was praised for
his patriotism and selflessness. But like all good deeds, Morgan's
didn't go unpunished. Some accused him of manipulating the government
and collecting a prophet.
Speaker 7 (15:14):
People began to decide that Pierpont had too much power
to be able to save the government of the United
States an extraordinary thing, and therefore the only way that
he could have done it is by having some sort
of evil capability.
Speaker 2 (15:31):
With the chaos, uncertainty, and personal demonization that often plagued
Morgan's life, there was one source of stability. Saint George's church.
The Reverend Rainsford said, sometimes I found him kneeling in prayer,
or reading or singing a hymn without organ and alone.
(15:54):
No one but myself knew that the great Master of
men and things was worshiping. But this great Master of
men and things had another side. Morgan was known for
enormous appetites.
Speaker 4 (16:10):
He consumed enormous quantities of port, sherry and wine with dinner.
He had breakfasts so large that could have killed a horse.
Speaker 2 (16:19):
His appetites extended to other areas as well. He was
often seen in the company of women other than his wife.
Speaker 4 (16:27):
Pierpont once made a very talent comment that there are
always two reasons why a man does something, a good
reason and the real reason. And he was always very
respectful of Fanny. He was very discreet about the various
escapades that he went through.
Speaker 1 (16:49):
And you've been listening to the story of JP Morgan,
and in the beginning of this segment we learned about
him losing the love of his life to tuberculosis, which
at the time was a death sentence. He joined Saint
George's Church where he find solace, redemption and also his
future wife. But it was his vision of electric light
(17:12):
illuminating not just America but the world, and his huge
investment empowering America with light that led to his great fortune.
And he backed Edison and actually, well he had the
first electrically lit home in the world. That's how much
he believed. And that investment parleyed into and turned into
(17:37):
General Electric, a company we all know. When we come back.
More of the story of JP Morgan, the good and
the bad, the visionary and the investment banker. Here on
our American stories, and we continue with our American stories
(18:10):
and the story of JP Morgan. Let's pick up where
we last left off.
Speaker 2 (18:16):
Morgan's passionate nature extended to his business enterprises. In nineteen
oh one, he undertook the largest business transaction in modern history,
the purchase of Carnegie Steel. Carnegie Steele was the crown
jewel in the Morgan Empire. When asked his name is Price,
Andrew Carnegie jotted down a figure on the back of
(18:38):
an envelope.
Speaker 12 (18:39):
Carnegie wasn't going to do any price haggling with Morgan.
Carnegie writes down four hundred and eighty million on a
piece of paper. It's the equivalent of four hundred billion today,
more than Gates and Buffett together.
Speaker 2 (18:54):
Carnegie dared JP Morgan to buy him out for an
outrageous price, a sum that is higher than the entire
budget of the US federal government. Telling the answer yes,
the deal was closed without lawyers and without a written contract.
(19:17):
The agreement gave Carnegie a personal net worth of over
three hundred and ten billion dollars in today's money, the
largest private fortune the modern world has ever seen. With
Carnegie Steel under his belt, Morgan formed the United States
Steel Corporation. In March of nineteen oh one, stock was
(19:39):
valued at one billion, four hundred million dollars. Morgan had
created the world's first billion dollar corporation, but his enormous
power now brought public scrutiny.
Speaker 4 (19:52):
After his creation of US Steel, he controlled somewhere between
sixty and seventy percent of the American steel industry. He
controlled a thread of American railways at a time when
railway stocks comprised sixty percent of all the stocks on
the New York Stock Exchange.
Speaker 2 (20:10):
Morgan had reached the pinnacle of his power, and it
looked as if nothing could stop him. At the turn
of the century, Morgan, along with John D. Rockefeller and
Andrew Carnegie, joined forces in launching the business friendly William
McKinley into the position of President of the United States.
(20:35):
But on September sixth, nineteen oh one, McKinley was cut
down by an assassin's bullet and died. Eight days later,
Vice President Theodore Roosevelt was sworn in as the next president. Now,
let's get started. Morgan soon confronted a man whose power
(20:55):
equaled his own.
Speaker 4 (20:56):
He was an unknown end today, but to the extended
people in New York knew his record. They also knew
that he was something of a loose cannon who had
gone on record as criticizing businessman.
Speaker 2 (21:10):
Roosevelt was determined to break up the big powerful businesses
called trusts, and he used Morgan's railroad company to set
the example.
Speaker 6 (21:19):
Morgan demanded to see the President, so he stormed down
from New York to Washington, went into the White House
and he said, I don't understand. He said, if we've
got a problem, send your man to my man and they'll.
Speaker 2 (21:30):
Fix it up.
Speaker 6 (21:31):
And Roosevelt said, this is exactly the problem with Morgan.
He acts as though I'm just a rival boss or something.
And Morgan, who thought that he could manipulate Roosevelt, discovered
that Roosevelt could not be manipulated at all.
Speaker 2 (21:47):
Morgan was not impressed.
Speaker 5 (21:49):
Pripont Morgan resented Theodore Roosevelt. Finally, and once, when he
heard that Roosevelt was going off to Africa on a safari,
Morgan said, good, the first line that meets him does
his duty.
Speaker 2 (22:07):
Morgan was prosecuted for breach of the Anti Trust Act
and lost in a five to four decision at the U. S.
Supreme Court. In nineteen oh three. Then in the fall
of nineteen oh seven, another panic hit Wall Street. One
of America's largest trust companies had collapsed, sending shockwaves throughout
the American economy. Immediate action was required, and President Roosevelt's
(22:32):
advisors knew that there was only one man with the
power to save the nation.
Speaker 11 (22:37):
Morgan's reach was very broad in American industry. He becomes
the most respected, reliable, and trusted figure, not only because
of the power and wealth and he wheels, but just
because of his character.
Speaker 2 (22:52):
The President, who had prosecuted Morgan for having too much control,
was about to hand that control back to him, and
Morgan had a plan. His answer was to get the
larger trusts to invest money in their weaker competitors. This
wasn't easy, but Morgan's power of persuasion was unmatched.
Speaker 4 (23:14):
Morgan was a very flamboyant and almost operatic figure, and
like well great actors, he liked to have great stage
sets for his big set pieces. He found it very
often in order to get a business deal. It helped
to isolate people and who also to set a deadline.
Speaker 2 (23:33):
He gathered the trust company presidents in his library. He
cast a long penetrating look at each man, and launched
into a plea for cooperation that at times sounded more
like a command. Morgan then walked to the front door
of the library, locked it, and retired to another room
to play solitaire. The nation's most influential men were locked
(23:57):
in Morgan's library and weren't allowed until they came up
with a solution.
Speaker 7 (24:02):
And he would be sitting at the desk and he
would be flipping his cards, and one of his lieutenants
would come in and say, mister Morgan, the bank presidents
have reposed a ten million dollar loan. And he would
be flipping his cards, and he would look up and
he would say it's not enough. It's like his cards. Again.
Speaker 2 (24:25):
In the early hours of the morning, Morgan marched into
the library. The men still had not come to a solution,
but Morgan had. He pushed a contract and a pen
into the hand of the leader of the trust company presidents.
He pointed to the contract and said, here's the place,
and here's the pen. Completely exhausted and beaten down, the
(24:49):
president signed and the others followed. The men agreed to
contribute to the twenty five million dollar pool to save
the week in trusts. Within day, the economy rallied, vowing
to never let it happen again, and realizing that in
a future crisis there was unlikely to be another Morgan,
(25:11):
The banking and political leaders devised a plan that resulted
in the creation of the Federal Reserve system in nineteen thirteen.
Here's Ron Chernaut.
Speaker 4 (25:20):
Prior to nineteen thirteen, we did not have a federal
Reserve Board in this country.
Speaker 8 (25:25):
We had J.
Speaker 4 (25:25):
Pierpont Morgan. He was like a one man central bank.
Speaker 2 (25:35):
On the morning of April fifteenth, nineteen twelve, Morgan was
scheduled to travel on the ill fated maiden voyage of
the RMS Titanic, but canceled at the last minute. The
White Star Line, which operated Titanic, was part of Morgan's
International Mercantile Marine Company, and Morgan was to have his
own private suite and promenade deck on the ship. In
(25:59):
response to the sinking of Titanic, Morgan purportedly said, monetary
losses amounts to nothing in life. It is the loss
of life that counts. It is that frightful death. On
March thirty first, nineteen thirteen, he died in his sleep
in a hotel in Rome, just short of his seventy
(26:22):
sixth birthday. Jay Pierpont Morgan used his integrity and his
influence to transform Wall Street at the turn of the century.
In the process, he changed America forever.
Speaker 1 (26:38):
And a terrific job on the production, editing and storytelling
by our own Greg Engler. And what a story you heard,
What a complicated and counterintuitive story. After all you'd ever
heard about the robber barons, particularly JP Morgan, you have
to rethink just about everything. What he did with Carnegie
would simply make the large business transaction and history. Carnegie
(27:02):
wrote down an epic number four hundred and eighty million dollars,
and there was no counter JP Morgan paid the full
amount and formed US steal the first billion dollar corporation
in America. The story of JP Morgan here on our
American Stories
Host
Lee Habeeb
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