This Day in Business History: Happy birthday, J.P. Morgan!

April 17, 1837: J.P. Morgan was a titan of American business. In the late 19th and early 20th centuries, his position and connections put him squarely in the middle of the development of American industry. Even today the name remains in the forefront of the global business financial world.

John Pierpoint Morgan was born April 17, 1837 in Hartford, CT. His father, Junius Spencer Morgan, was a businessman of note who had high expectations for his son Pierpoint and started training him at a very early age, including having him work at bank, Peabody, Morgan & Co. Later he helped to form the firm Drexel, Morgan & Company, later renamed J. P. Morgan & Company.

His influence was so great that one wouldn’t be totally wrong in thinking that J.P. Morgan was synonymous with banking. However, Morgan was not content just in the banking world – he had many interests elsewhere. The publisher of the Chattanooga Times secured a loan with J.P. Morgan’s help which helped to save a financially strapped New York Times. His personal and business interests also extended to steel and railroads; he purchased U.S. Steel from Andrew Carnegie and merged it with a few other firms to create United States Steel in 1901. In addition, Morgan had an interest in, and saw the potential in electricity. He and Thomas Edison had a long history which began when Morgan helped to finance Edison’s early experiments in electricity. In 1881, Morgan decided to go further and had Edison electrify his house and office building. Eventually Edison, with Morgan’s help, began the process to electrify the city of New York.

But it was the world of banking and high finance where Morgan was the most visible and made the biggest impact. Twice, he put his power behind efforts to stabilize the economy. First, in 1873, he coordinated with the Rothschilds to supply gold to the U.S. Treasury during the Panic of 1873 and he stepped in again in 1907. The Panic of 1907, sometimes referred to as the Bankers’ Panic, was brought on when many banks found themselves on the edge of going bankrupt with no way to save themselves. J.P. Morgan stepped in and pledged his own money as well as convincing other wealthy individuals to do the same in order to stabilize the banking system. 

Morgan died in Italy on March 31, 1913, but his legacy still lives on today. In 1933 as a result of the Glass–Steagall Act, what was known as the House of Morgan was broken up into 3 separate firms – J.P. Morgan & Co., which later became Morgan Guaranty Trust, Morgan Stanley, and Morgan Grenfell in London. In 1990 Morgan Grenfell was acquired by Deutsche Bank and both J.P. Morgan Chase and Morgan Stanley are still around. You cannot look at the history of banking in the United States without studying J.P. Morgan, and you cannot study the development of business and industry without running into him.