J. P. Morgan Net Worth

What Was J.P. Morgan's Net Worth?

J. P. Morgan was an American businessman and financier who had a net worth of $120 million at the time of his death. In modern terms, he was worth somewhere between $25 billion and $45 billion. The variation depends largely on the value of his real estate portfolio and art collection. Half of that value was attributable to his share in New York and Philadelphia banks.

J. P. Morgan began his career in banking in the 1850s, working for his father's firm, Peabody, Morgan & Co., in London before moving to New York to establish his own path in finance. In 1871, he co-founded the investment banking firm Drexel, Morgan & Co., which later became J.P. Morgan & Co., a predecessor to today's JPMorgan Chase.

Morgan became a dominant force in corporate finance and industrial consolidation. He was instrumental in the creation and reorganization of several major companies, including General Electric and U.S. Steel. In 1901, he engineered the merger that formed U.S. Steel, the world's first billion-dollar corporation, by acquiring and consolidating the assets of Andrew Carnegie and others. He also played a key role in building modern infrastructure, backing the expansion of the American railroad system and investing in Edison Electric, which evolved into General Electric.

Morgan's influence extended beyond business. During the financial panic of 1907, he effectively acted as the central bank of the United States, organizing a coalition of bankers to stabilize the markets and prevent economic collapse. His actions during the crisis helped restore confidence in the banking system and highlighted the need for a federal central bank, leading to the creation of the Federal Reserve System in 1913.

Though often criticized for his enormous power and influence, Morgan was also respected for his ability to bring order to chaotic markets and industries. By the time of his death in 1913, he had helped shape the architecture of American capitalism, leaving behind a complex legacy as both a monopolist and a stabilizing force in finance.

Early Life and Career Beginnings

John Pierpont Morgan, best known by his initials as J. P. Morgan, was born on April 17, 1837, in Hartford, Connecticut. His father, Junius Spencer Morgan, was from the influential Morgan family. In 1850, his uncle, James Lord Pierpont, composed the song "Jingle Bells."

J.P. was educated at the English High School of Boston, a renowned commerce school. After graduating, he studied French at a school in the Swiss village of La Tour-de-Peilz and then attended the University of Gottingen to work on his German language skills.

With his education in business, Morgan started working in 1857 at the London branch of Peabody, Morgan & Co., a company his father helped found three years before with George Peabody. After only one year, J.P. moved to New York City and began working for another banking company, Duncan, Sherman & Company, an extension of his father's company. He avoided having to serve in the military during the American Civil War by paying a substitute $300 to take his place. In 1864, Peabody retired, and Morgan's father's company was renamed from Peabody, Morgan & Co. to J. S. Morgan & Co.

Career

In 1871, Morgan partnered up with the Drexel family of Philadelphia to form the firm Drexel, Morgan & Company. After Anthony Drexel passed away, the firm was renamed J. P. Morgan & Company in 1895. His firm enjoyed close ties with his father's company, J. S. Morgan & Company, as well as other leading firms like Drexel & Company of Philadelphia and Morgan, Harjes & Company of Paris. He focused on reorganizations and consolidations, and by 1900 his firm was one of the most powerful banking firms in the world.

His main business model centered around taking over troubled businesses and reorganizing their structures and management so that they became profitable again. This process was sometimes referred to as "Morganization". Then, using his reputation as a banker and financier, he would draw investors to these revamped businesses. The industry that he focused much of his attention on was the American railroad industry. Not only did he take over many railroads, including the Albany and Susquehanna Railroad, Philadelphia & Reading Railroad, and the Chesapeake & Ohio Railroad, to name just a few, but many of his efforts were centered around reorganizing the railroad systems to make them more efficient. He actually set up conferences in 1889 and 1890 that brought together railroad presidents to write agreements relating to maintenance and charging "public, reasonable, uniform and stable rates."

Following his father's death in 1890, Morgan took control of the company J. S. Morgan & Co. It would be renamed Morgan, Grenfell & Company in 1910. He managed to negotiate a deal in 1900 with Charles M. Schwab, the president of Carnegie Co., along with businessman Andrew Carnegie, to buy Carnegie's business. He took Carnegie's business and merged it with several other steel and iron businesses to create the massive industrial firm the United States Steel Corporation (U.S. Steel). U.S. Steel had an authorized capitalization of $1.4 billion, making it the first billion-dollar company in the world.

From 1890 to 1913, a total of 42 different major corporations were either organized by, or had their securities underwritten by, J. P. Morgan & Company. These corporations include American Telephone & Telegraph, International Mercantile Marine Company (the owners of the White Star Line, which owned and operated the ill-fated RMS Titanic), General Electric, Federal Steel Company, and the United States Steel Corporation.

(Photo by Kean Collection/Getty Images)

Unsuccessful Ventures

Every successful businessman has to weather through the occasional poor investment, and Morgan was no exception. One of his more notable bad investments was when he gave inventor Nikola Tesla $150,000 (the equivalent of $4,609,800 in today's dollars) to build a trans-Atlantic wireless communication system in exchange for 51% control of the patents. Without prior approval from Morgan, Tesla decided to make changes to the planned facility. Morgan treated Tesla's changes as a breach of contract and subsequently refused to fund the changes, resulting in the project never becoming operational, and eventually it was abandoned.

As a man used to success, especially when it came to building railroad lines, Morgan was embarrassed in 1902 when his plans to build a subway line in London were blocked by his competitor, the transit magnate Charles Tyson Yerkes.

(Photo by © CORBIS/Corbis via Getty Images)

Personal Life and Death

In 1861, Morgan married Amelia Sturges, known as Mimi; she passed away the following year. He then married Frances Louisa Tracy, known as Fanny, in May 1865. He and Fanny had four children together: Louisa Pierpont Morgan, J. P. Morgan Jr., Juliet Pierpont Morgan, and Anna Tracy Morgan. J.P. suffered from rosacea, which resulted in the deformation of his nose due to rhinophyma. Due to his self-consciousness about his appearance, Morgan was known to dislike publicity and being photographed. He was a lifelong member of the Episcopal Church.

Morgan passed away in his sleep on March 31, 1913, while staying at the Grand Hotel Plaza in Rome, Italy, while he was traveling through Europe. He is buried in the Cedar Hill Cemetery in Hartford, Connecticut, the town where he was born.

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