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J.Pierpont
Morgan was another monument of the Gilded Age. This son of a wealthy
merchant banker joined forces with the
Drexels of Philadelphia in
1873 to precipitate the fall of
Jay Cooke, the patriot banker and
Union bond broker now hopelessly entangled in the building of the
Northern Pacific railroad. Morgan then became the peacemaker in the
railroad wars of the 1880's, having gained
the Vanderbilts'
confidence in a transaction involving the sale of 100'000 New York
Central shares in London and benefiting from the Drexels'
introduction at the Pennsylvania.
Drexel,
Morgan & Company became J.P.Morgan & Company in 1893, the nation's
premier investment bank. It actively participated in the
reorganization of railroads and in the consolidation of industries
and public utilities. When he created United States Steel in 1901,
the first American corporation with a capitalization exceeding $ 1
billion, John Pierpont Morgan wielded more power than any other
American capitalist and indeed and other man in the World. Morgan
creations also included General Electric, International Harvester
and the reorganization of American Telephone & Telegraph Company.
The Titanic was a ship of the International Mercantile Maritime
trust, a corporation J.P. Morgan sponsored in 1902.
In
many ways, the Gilded Age was also the age of the banker, who
evolved from trade financier to railroad consolidator and organizer
of industrial corporations. Morgan was the greatest and most
charismatic of the great investment bankers of his time, but he was
in no means the only one, and he was also not the richest. The
superlative among the bankers in terms of wealth fell to the Mellon
brothers of Pittsburgh. Andrew William Mellon and Richard Beatty
Mellon took active participations of more than the usual token value
in the enterprises they financed. They were major stockholders in
the fabulously successful Gulf Oil corporation and the Aluminum
Company of America. Their aggregate wealth exceeded $ 1 billion
before the stock market crash of 1929.
The
Gilded Age saw also the rise of the great commercial banks, most of
them located in New York. Moses Taylor built the City Bank into New
York's largest and made himself a 40 million dollar fortune. James
Stillman, who took the presidency of the National City Bank in 1891,
built its assets to the $ 1 billion mark. George Fisher Baker did
not found the First National Bank of New York, but he became its
largest shareholder and head from 1877 until his death in 1930.
These banks later merged to form the First National City Bank of New
York, nowadays known as Citicorp.
The
Gilded Age also saw the establishment of
Jewish banking houses in
America, where they had long been absent, or at least much less
influent than in Europe. August Belmont was the agent of the
Rothschilds in New York and in this position, one of the most
influent Jewish banker in America. The Seligmans were merchandise peddlers and clothing
merchants before establishing their international banking house
J &
W Seligman & Company.
But
the largest and most influential American Jewish banking house was
Kuhn, Loeb & Co of New York. Founded by Abraham Kuhn and Solomon
Loeb in 1867, the firm was later directed by
Jacob Henry Schiff
(1847-1920) who sided with E.H. Harriman in 1901 against J.Pierpont
Morgan and James Jerome Hill in the battle for the Northern Pacific.
Kuhn, Loeb & Company was related to the house of M.M. Warburg of
Hamburg, Germany. The main partners of Kuhn, Loeb & Co were
interrelated by marriage as was quite usual in Jewish American
businesses at the time.
The Gilded Age
>
Introduction and Index
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