J.P. Morgan
John Pierpont Morgan is one of the most famous financiers in business history. Plenty of controversy has surrounded Morgan on whether his business strategies were for better or for worse. A robber baron is considered, “an American capitalist of the latter part of the 19th century who became wealthy through exploitation”. Morgan was just that. J.P. Morgan was a robber baron not only because he possessed a lot of power that wasn’t meant to be his, but he also revealed the fragility of the financial system.
J.P. Morgan was born into wealth. At the age of 20, Morgan followed in his father’s footsteps into the world of business and banking. He began working in a London branch of the banking firm Peabody, Morgan & Co. This firm was formed by a partnership between his father Junius Spencer Morgan and George Peabody. Morgan was heavily involved in reorganizing several financially troubled railroad companies. Gradually, he gained control of portions of these railroads’ stock. Morgan bought Andrew Carnegie’s steel company and gained power over 2/3 of the steel industry and created a monopoly out of it. Morgan was the main force behind many businesses and controlled most of the American industries. When his bank was founded it was under the partnership with Anthony Drexel. The bank which was originally named Drexel, Morgan & Co., was later changed to J.P. Morgan & Co. His bank was the first national bank before the Federal Reserve existed. This bank was the site of many foreign affairs and interactions. This bank also worked as an unofficial central bank for the U.S. economy in the 1900s. In 1901, a rivalry that Morgan had with E.H. Harriman became so big that it caused the first stock market crash. This ruined thousands of investors and threw off the entire financial system. Yet, J.P. Morgan and Co. acquired so much power that Morgan was accredited for pretty much ending the Panic of 1907. He had so much power that any misstep could be overlooked.
He had too much power. He had too much control over the financial system. In the long run, nothing positive could come from having as much power as he did.