Morgan: American Financier

MONEY AND
TRUST

Pierpont Morgan's arrival took the quiet chamber by surprise. It was 2:00 P.M. on a mild Wednesday in December 1912, and the congressional committee did not expect its star witness until the following day. Politicians, lawyers, clerks, reporters, and the casual visitors who had come to watch these proceedings on Capitol Hill stopped what they were doing. All eyes followed the seventy-five-year-old banker and his party as they filed slowly toward seats near the center of the hall.

    Morgan's matronly daughter, Louisa, stayed close to his side. His son, J. P. Morgan, Jr., walked a step behind. Next came two young partners from Morgan's Wall Street bank—Thomas W. Lamont and Henry P. Davison, with their wives—and a couple of lawyers. From a distance, the two J. P. Morgans looked very much alike. Each stood six feet tall, weighed over two hundred pounds, carried a velvet-collared Chesterfield topcoat, and walked with a tapered mahogany cane. People standing nearby could see the same broad planes in both faces, but the son's hair was dark and his features trim, while the father wore a drooping, grizzled mustache, what hair he still had was white, and his overgrown eyebrows arched up like wide-angled Gothic vaults. It was hard not to stare at the elder Morgan because of the rhinophyma—excess growth of sebaceous tissue—that deformed his nose. No one stared for long. Edward Steichen, who had taken the old man's photograph a few years earlier, said that meeting his gaze was like looking into the lights of an oncoming express train.

    Once the New Yorkers had found seats, the afternoon's witness—a statistician named Philip Scudder—resumed his testimony, and Mr. Morgan heard his name mentioned several times. Mr. Scudder was describing, with the help of tables, charts, and diagrams, how eighteen financial institutions effectively controlled aggregate capital resources of over $25 billion—comparable to two thirds of the 1912 gross national product.

    There is no precise way to measure the value of a 1912 dollar nearly a century later, but using a rough equivalent to the consumer price index and adjusting for inflation, $25 billion from 1912 would be worth about $375 billion in the 1990s. A more revealing comparison comes from the percentage of gross national product: two thirds of the 1998 GNP would be about $5 trillion.

    For months in 1912 this House Banking and Currency subcommittee, headed by Louisiana Representative Arsène Pujo, had been trying to establish that a "money trust" ruled over America's major corporations, railroads, insurance companies, securities markets, and banks. The investigation served as climax to more than two decades of intense popular antagonism to "big money" interests—an antagonism that traced back to the founding of the American colonies. And now here under subpoena was the dominant figure behind all the recent financial consolidations, "the Napoleon of Wall Street."

    Morgan by 1912 could not cross the street, much less the Atlantic, without arousing speculation in the stock market and the press, He managed to enter the Pujo Committee hearing room with minimal fanfare on Wednesday, December 18, because of a schedule change. The committee's counsel, Samuel Untermyer, had telephoned the Morgan bank on Tuesday morning to say that he would not be ready to examine the financier on Wednesday as originally planned, but would start on Thursday, December 19, instead. Morgan took a private train to Washington on Tuesday anyway, bringing with him an imposing array of counsel that included Joseph Hodges Choate, one of the country's leading corporate lawyers, a former U.S. ambassador to Britain's Court of St. James, and past president of the Bar Association of the City of New York; former Senator John Colt Spooner, once Wisconsin's preeminent railroad attorney: Richard V. Lindabury, who was defending the Morgan-organized U.S. Steel Corporation against a government antitrust suit: De Lancey Nicoll, former district attorney for the City of New York; William F. Sheehan, former lieutenant governor of New York; George B. Case of the New York law firm White & Case; and Francis Lynde Stetson of Stetson, Jennings & Russell, known as "Morgan's Attorney General." None of these men would be allowed to advise the banker as he testified, but they provided weighty political support.

    The party reached Washington early Tuesday evening and went directly to the Willard Hotel at 14th and Pennsylvania. Morgan was gloomy and irritable. He had a bad cold. After dinner, too tired for any more talk with lawyers, he sat up late smoking his favorite cigar—a large Pedro Murias JPM made especially for him in Havana—and playing solitaire.

    He disliked everything about these hearings. For years he had worked closely with politicians he trusted, and thought U.S. markets would continue to thrive if the government let financial experts alone to conduct business in the nation's best interests. Neither the government nor the press had left him alone lately, however, and neither seemed willing to take his word about what constituted the country's best interests. Pretty soon, he ruefully told a friend, business would have to be conducted with "glass pockets." The Pujo Committee apparently wanted to go through his pockets, and to score political points with the proceedings.

    Morgan had some grounds for thinking that the country ought to leave its financial affairs to him. Over the past half century, his bank had helped transform the United States from an economic neophyte into the strongest industrial power in the modern world. In the 1850s, when America needed much more capital than it could generate on its own, the Morgans and their associates had funneled money from Europe to build railroads and float government bonds. By the turn of the century, Pierpont Morgan was organizing giant industrial corporations, largely with American money, and the vital center of world finance had shifted from London to New York.

    The risks involved in funding the emerging U.S. economy were as enormous as the potential rewards, but investors regarded the Morgan name on issues of stocks and bonds as a warranty. It is a maxim on Wall Street that cash chases performance, and the house of Morgan established its reputation by backing properties that yielded steady profits and long-term growth. Moreover, Morgan personally took on the job of financial disciplinarian, acting as mediator between the owners and the users of capital. His clients, largely foreign at first, were putting up money to build railroads, steel mills, farm equipment, and electrical plants, and when things went wrong with one of those operations, Morgan fired the managers, restructured the finances, and set up a board of trustees to supervise the company until things went right. He was building internationally competitive financial and industrial structures, and his power came not from his own wealth but from a record that led other bankers and industrialists to trust him.

    It is another Wall Street maxim that markets hate uncertainty. Wars, panics, crashes, and depressions punctuated Morgan's professional life, disrupting the flow of capital toward the future he had appointed himself to guard, and over time he had managed to impose a measure of order on America's turbulent economic development. He reorganized the nation's railroads (the process came to be known as Morganization), put together the world's first billion- dollar corporation (U.S. Steel), and had a hand in setting up International Harvester and General Electric—all on the principle that the combination of rival interests into huge, stable systems was preferable to the boom-and-bust cycles, price wars, waste, and speculative recklessness of internecine competition. The "Napoleon of Wall Street" advocated a kind of managed competition, in which the managing was done not by government bureaucrats but by experienced professionals who understood the complexities of high finance—in other words, by him. Given the arcane nature of capital markets, a private banker with transatlantic authority, access to accurate information, and a high sense of stewardship was able to exercise extraordinary power.

    Under Morgan's direction, New York's major financial houses in 1912 were serving in effect as a central bank. Andrew Jackson had terminally crippled the Second Bank of the United States in 1836, shortly before Morgan was born, and Woodrow Wilson signed the Federal Reserve System into law in 1913, just after Morgan died. Between 1836 and 1913 there was no central bank to regulate the supply of money and credit in the United States, no official lender of last resort, no federal recourse in times of acute turbulence or panic. America's antiquated banking system had been devised before the Civil War, for a decentralized agricultural society. When the federal government ran out of gold in 1895, Morgan raised $65 million and made sure it stayed in the Treasury's coffers. When a panic started in New York in 1907, he led teams of bankers to stop it.

    For a moment in 1907 he was a national hero. Crowds cheered as he made his way down Wall Street, and world political leaders saluted his statesmanship with awe. The next moment, however, the exercise of that much power by one private citizen horrified a nation of democrats and revived America's longstanding distrust of concentrated wealth. Morgan's critics charged that he had made huge profits on the rescue operation—even that he had engineered the crisis in order to scoop up assets at fire-sale prices. The 1907 panic convinced the country that its financial welfare could no longer be left in private hands. It led to the setting up of a National Monetary Commission, to the "money trust" investigation, and eventually to the founding of the Federal Reserve.

* * *

As Morgan played out rounds of solitaire late Tuesday night at the Willard Hotel, he had several things on his mind besides the approaching congressional ordeal. He was due to leave in January on his annual trip to Egypt, where he was underwriting archaeological excavations as president of New York's Metropolitan Museum of Art. He planned early in 1913 to visit the expedition house he had commissioned for museum field-workers at Deir el-Bahri, the magnificent temple complex within the ancient city of Thebes. After Egypt, he would stop to see the new buildings he had funded at the American Academy in Rome, then go on to take the waters at Aix-les-Bains in southeastern France.

    He could, he said, do a year's work in nine months but not in twelve, and accordingly visited Aix every spring. Though he had exceptional physical stamina, Morgan periodically collapsed in depression and "nervous" exhaustion, and tried to ward off these breakdowns with foreign travel and spa cures.

    His wife, who also suffered from depression, did not figure in his travel plans. The marriage had been over in all but form for thirty years. He sent her to Europe for months each summer and fall with a chauffeured car, one of their daughters, and a paid companion; when she returned, he took troops of friends, often including his mistress, abroad. Mrs. Morgan was heading home on the Atlantic in December 1912 as he prepared to leave.

    He had spent increasing amounts of time in Europe as he turned the focus of his attention from business to collecting art. The scope of his 1901 acquisitions had prompted one of his British partners, Clinton Dawkins, to wire the New York firm (referring to Morgan in code)—"I hope, though we cannot hint it, that Flitch will not buy the National Gallery at the end of the year." The following summer, as "Flitch" dined with Edward VII in London and entertained Kaiser Wilhelm on board his yacht, Corsair, at Kiel, Dawkins complained: "We never see him and it is difficult to get hold of him. He spends his time lunching with Kings or Kaisers or buying Raphaels."

    The Raphael, an altarpiece known as the Colonna Madonna, was about to go on exhibition at the Metropolitan Museum in 1912, along with other highlights of the painting collection Morgan had been shipping over from London all year. Among the canvases that would be shown together in the United States for the first time were Rembrandt's Nicolaes Ruts, Vermeer's A Lady Writing, Gainsborough's Duchess of Devonshire, Lawrence's Miss Farren, and works by Turner, Rubens, Van Dyck, Reynolds, and Greuze. A set of Fragonard panels called The Progress of Love, which had occupied a special room in Morgan's London house, would not be shown until a similar room could be constructed for them at the Met. In December 1912 Morgan was in the process of buying for $200,000 an altarpiece attributed to Filippo Lippi from the chapel of the Villa Alessandri, Fiesole—St. Lawrence Enthroned with Saints and Donors.

    As a private collector and as president of the Metropolitan Museum, Morgan was stocking America with the world's great art. His purchases included not only Old Master paintings and drawings but sculpture, majolica, tapestries, Regency furniture, bronzes, jewelry, watches, ivories, coins, armor, portrait miniatures, seventeenth-century German metalwork, Carolingian gold, rare books and illuminated manuscripts, Gutenberg Bibles, medieval reliquaries, Limoges enamels, Gothic boiserie, Chinese porcelains, ancient Babylonian cylinder seals, Assyrian reliefs, and Roman frescoes from Boscoreale.

    By 1912 he had spent about $60 million on art (roughly $900 million in the 1990s), and had given many important objects away. What would happen to the collections after his death was not clear. The Metropolitan Museum hoped to receive them as a gift, but Morgan wanted the museum to build a new wing, and New York City officials had not come up with the requisite funds. To accommodate his rare books, manuscripts, and drawings, he had built an Italianate marble library, designed by Charles McKim, next to his house in Murray Hill. The London Times, reporting on the library's treasures in 1908, said of millionaire collectors: "One out of ten has taste; one out of a hundred has genius. Mr. Frick, Mr. Altman, Mr. Widener in America, and the late Rodolphe Kann in Paris, come under the former category; but the man of genius is Mr. Pierpont Morgan."

    Few Americans had been as magnanimous as the London Times, either toward Morgan's collecting or the career that made it possible. The federal government had begun at the turn of the century to enforce the Sherman Antitrust Act, a law passed in 1890 to curb private economic power, prohibit monopolization, and proscribe agreements that had the effect of restraining trade. When Theodore Roosevelt's Justice Department won a celebrated antitrust suit against a railroad holding company organized by Morgan, James J. Hill, and E. H. Harriman, Morgan's British partner Mr. Dawkins observed that to use "the blessed word `combination' ... in America causes as much disturbance now as the singing of the Marseillaise under the Third Empire."

    Combination, monopoly, merger, consolidation, trust: to Morgan and his colleagues, these forms of industrial organization made practical and financial sense. They had grown out of new mass-production and distribution capacities that were radically reducing operating costs, increasing efficiency, and creating immense national wealth. Elsewhere in America, however, the new industrial leviathans' subjugation of labor, stifling of free-market competition, and concentration of financial and political power were widely seen as a threat to the country's fundamental ideals.

    Popular hatred of the trusts, along with a split in the Republican Party between Roosevelt's Progressives and William Howard Taft's Old Guard, had helped elect Woodrow Wilson in November 1912. The new chief executive would take office with Democratic majorities in both houses and a clear mandate for reform. He immediately declared war on monopoly concentration, promising to protect American farmers and workers from big business.

    As if all that weren't enough to keep Morgan awake on the eve of his appearance before the Pujo Committee, a number of his consolidations were in trouble. U.S. Steel, the largest jewel in his crown, had been charged with violating the Sherman Act. The New York, New Haven, & Hartford Railroad, on which he had hoped to base a New England transportation empire, was nearly bankrupt and under political attack. And the securities of his 1902 shipping combine, the International Mercantile Marine, had never sold at all. The disaster that hit the IMM's White Star Line in April 1912 was not an antitrust suit but an iceberg. After the loss of the Titanic, people joked that the IMM stock held more water than the sunken ocean liner.

    As the Pujo Committee began looking into Morgan's "trustification" of banking and credit in March of 1912, J. P. Morgan, Jr., called "Jack," hoped that Congress might "behave quite decently" about the inquiry, but his optimism collapsed when the committee appointed Samuel Untermyer—an experienced corporate lawyer and a strident critic of the "money trust"—as its chief counsel. "Investigation will probably proceed now on as unpleasant lines as can be arranged," Jack had warned his father in April.

* * *

It was late by the time Morgan finished his last cigar at the Willard on Tuesday night, put away his cards, and went to bed. When his party arrived at the hearing room in the House Office Building on Wednesday afternoon, he looked worn-out, and was having difficulty breathing through his cold. Louisa and counselor Lindabury sat next to him on one side, the Davisons on the other, with Jack, the Lamonts, and former DA Nicoll directly behind them. They found Mr. Untermyer surprisingly accommodating. He quickly completed his examination of the statistician, and called Morgan to the witness stand at 3:00.

    Untermyer's opening questions were routine, establishing for the record the general organization of J. P. Morgan & Co., its connections to affiliated banks in Philadelphia, London, and Paris, the names of its partners, and the kind of business it conducted. He brought out that the firm accepted deposits and issued securities for its corporate clients. (The functions of commercial and investment banking were not separated until 1933, by the Glass-Steagall Act.) Morgan confirmed information prepared ahead by his partners that as of November 1, 1912, seventy-eight corporations had nearly $82 million on deposit at his bank, and that the total assets of those companies amounted to nearly $10 billion.

    After half an hour, Chairman Pujo interrupted to say that the members of the committee had been called to the House: the proceedings would resume in the morning. Before the politicians left, Morgan told them he hoped his testimony could be taken as quickly as possible, since he was planning to go abroad.

    At 9:00 A.M. on Thursday, he returned to find several hundred spectators packed into the committee hall, with reporters and photographers competing for space up front. He was accompanied, this time, by Joseph Choate, John Spooner, William Sheehan, and George Case, as well as Louisa, Jack, Davison, and Lamont. And this time he looked rested and alert.

    As the questioning resumed he asked to move up to the committee table on a raised dais, within arm's reach of Mr. Untermyer, "So I can hear better. I am a little hard of hearing: you know, I'm getting old." When his voice grew hoarse, he turned to Louisa for throat tablets, and at one point Untermyer asked if he wanted a glass of water. "No, thanks," said Morgan.

    "If you get tired, don't hesitate to say so," the lawyer offered.

    "I'm not tired," Morgan replied.

    The first light moment of the day came when Untermyer asked if his witness was not a large stockholder in another powerful bank, the National City. "Oh no," answered Morgan, "only about a million dollars' worth." He seemed surprised when general laughter greeted this response, but after a minute he joined in.

    Untermyer wanted to show that New York's five leading banks—J. P. Morgan & Co., National City, the First National, Bankers Trust, and Guaranty Trust—had a stranglehold on the country's capital and credit. The hearings brought out that officers of these five banks held 341 directorships in 112 U.S. companies—in banks, public utilities, insurance, transportation, manufacturing, and trade; the Morgan partners alone sat on 72 boards. Nonetheless, Morgan wanted to show that there was no such thing as personal control in the complicated business of money.

    To dozens of questions he replied that he did not know or could not remember. Though he had once mastered every number on every piece of paper that came through his office, he was getting old, as he reminded Mr. Untermyer, and had been delegating the detail work to younger men for years. To other questions his answers were incomprehensible. As his partners and close friends knew, his intelligence was not verbal or analytic but perceptual and concrete: it dealt in numbers, objects, action. At times the exchanges between Untermyer and Morgan had the edgy/comic quality of absurdist drama, as if the two men were speaking different languages and earnestly pretending to understand each other.

    On the question of free market competition versus monopoly concentration, Untermyer suggested: "You are opposed to competition, are you not?"

    Morgan declined the suggestion: "No. I do not mind competition...."

    Untermyer pressed: "You are an advocate of combination and cooperation, as against competition, are you not?"

    Morgan chose the less incendiary word: "Yes: cooperation I should favor."

    "Combination as against competition?"

    "I do not object to competition, either," Morgan said. "I like a little competition."

    Then he asked if he might continue for a moment on a "sensitive" subject which he really did not "want to talk of.... This is probably the only chance I will have to speak of it."

    "Certainly," Untermyer nodded. "You mean the subject of combination and concentration?"

    "Yes." Perhaps thinking of the consolidations that had failed, and the competitive pressures that had given rise to the trusts, Morgan went on: "the question of control. Without you have control, you cannot do anything."

    Untermyer did not understand. "Unless you have got control, you cannot do what?"

    "Unless you have got actual control, you cannot control anything," Morgan enigmatically repeated.

    Untermyer: "Well, I guess that is right. Is that the reason you want to control everything?"

    Morgan: "I want to control nothing...."

    Untermyer: "What is the point, Mr. Morgan, you want to make, because I do not quite gather it."

    Morgan did not see himself as wanting control. All his life he had observed what happens to money as it moves through international markets, changing direction as swiftly as a school of fish. He had worked with it in cycles of expansion and contraction, through panics, depressions, competitive price wars, speculative gambles, and government defaults. When a Morganization succeeded, stock prices rose; when a combination failed, all his financial and political efforts could not keep share prices from falling. Asked to predict what the stock market would do, he invariably replied, "It will fluctuate." Necessity, in his view, had drafted him to do what he could to police the markets and keep the U.S. economy on track, but in the end no one could control money, and it is in that context that his opaque, clumsy testimony makes some sense.

    Urged to clarify his point, he went on: "What I say is this, that control is a thing, particularly in money, and you are talking about a money control—now, there is nothing in the world that you can make a trust on money."

    Plausibly enough, Untermyer found this statement difficult to follow: "Your idea is that when a man has got a vast power, such as you have—you admit you have, do you not?"

    Morgan demurred: "I do not know it, sir ..."

    Untermyer: "Well, assuming that you had it, your idea is that when a man abuses it, he loses it?"

    Morgan: "Yes: and he never gets it back again, either."

    Shortly after this exchange, Untermyer asked whether the witness would like to stop for lunch. Morgan: "I do not want to stop at all. I am ready to go right on. I would like to get through. That is all.... I wanted to have you understand my views about the thing. I will stop any remarks on my side, however." The committee recessed for lunch.

* * *

The old man seemed at times to be enjoying the chance to say things he had long thought about, noted New York's Evening Post, but then "suddenly, he would look about and discover the presence of the crowd, as if he had not seen the people before. A quick change would pass over his face; he would shrink visibly, and become again the man he has been so long, a hater of publicity and self-disclosure. Nothing more interesting could be imagined than this constant shift of personality, from the great power in finance, dominating, direct, and courageous, to the man of artistic tastes and retiring habit, shrinking before the faces of strangers."

    After lunch, Untermyer again tried to establish the reach of Morgan's empire and again met with denials. "Your power in any direction is entirely unconscious to you, is it not?"

    Morgan qualified his assent: "It is, sir, if that is the case."

    Circling around another way, Untermyer tried to get at the reasons behind the consolidation of railroad systems, steel plants, and banks. And this time he succeeded in drawing out of his witness a peremptory (and to democratic ears, an outrageous) assumption of political prerogative. Behind Morgan's cryptic replies lay his conviction that the process of industrial concentration was a virtual force of nature—irresistible, certainly not invented by him, and better off in his hands than it might have been in others', though he was also denying that it was by any stretch of the imagination in his hands at all.

    Asked why he had amalgamated large corporations, Morgan replied, "If it is good business for the interests of the country to do it, I do it."

    "But Mr. Morgan," objected Untermyer. "Is not a man likely, quite subconsciously, to imagine that things are for the interests of the country when they are good business?"

    "No sir," said Morgan.

    Untermyer: "You think that you are able to justly and impartially differentiate, where your own interests are concerned, just as clearly as though you had no interest at stake, do you?"

    Morgan: "Exactly, sir."

    Untermyer: "And you are acting on that assumption all the time, are you not?"

    Morgan: "I always do, sir."

    Untermyer: "Of course, there is a possibility of your judgment being mistaken, is there not?"

    Morgan gave a disarming reply: "Oh, I may be wrong in my judgment, but I do not think it lies in that direction."

    Untermyer: "Does it not go somewhat on the theory that the wish may be father to the thought?"

    Morgan: "What is your question?"

    Untermyer: "That the wish to bring these interests together may lead you to believe that the country is not injured by that sort of concentration?"

    Morgan: "I do not think so."

    Finally, in what has become the most famous exchange in the hearings' thousands of pages of testimony, the two men returned to the question of controlling money and credit. Untermyer said, "The basis of banking is credit, is it not?"

    Morgan: "Not always. That is an evidence of banking, but it is not the money itself. Money is gold, and nothing else."

    There was in 1912 a significant difference between actual metal coin and loans represented by pieces of paper (banknotes, bonds, bills). When Morgan repeated yet again that money could not be controlled, Untermyer asked him whether credit was not based on money—that is, did not the big New York banks issue loans to certain men and institutions "because it is believed that they have the money back of them?"

    Morgan: "No sir. It is because people believe in the man."

    Untermyer: "And he might not be worth anything?"

    Morgan, with less than perfect regard for grammar: "He might not have anything. I have known a man to come into my office, and I have given him a check for a million dollars when I knew they had not a cent in the world."

    Untermyer: "That is not business?"

    Morgan: "Yes, unfortunately it is. I do not think it is good business, though."

    Untermyer did not, apparently, think much of this answer, for he repeated his proposition: "Is not commercial credit based primarily upon money or property?"

    Morgan: "No sir; the first thing is character."

    Untermyer: "Before money or property?"

    Morgan: "Before money or property or anything else. Money cannot buy it"—and he elaborated, after a few more questions—"because a man I do not trust could not get money from me on all the bonds in Christendom."

* * *

After the committee adjourned on Thursday afternoon, Morgan and his party went directly to Union Station and from there by private train to New York. Stock prices, which had dropped at the beginning of the week in what Wall Street analysts called a Pujo market, rose on Friday in a jubilant "Morgan market." One trader told The New York Times, "We are wearing the Morgan colors to-day. He has helped us to get our nerve back." Jack Morgan cabled the London partners that his father's testimony had been "quite extraordinarily successful, perfectly frank, very helpful to situation. He himself is delighted and very well, and whole country appears to be very pleased and satisfied."

    With somewhat less enthusiasm, the Times reported that though the old man had not changed many people's views about the questions under investigation, still, "If impressions gleaned the day after from conversation with Senators and Representatives count for anything, J. P. Morgan lost no prestige through his appearance.... On the contrary, his willingness as a witness and his evident sincerity and frankness seem to have created a distinctly favorable impression."

    An editorial in the Evening Post praised his "uncommon ability," bowed to his expertise, and scolded those who were attacking the methods of high finance, yet found several of his positions "contrary to all that is settled in regard to the nature of man.... It will never do to say that unchecked power is a good thing because it is in the hands of good men."

    Two weeks later, Morgan left for Egypt with his daughter Louisa and several friends. On the Nile in early February he slid into a delusional depression. He could not eat, had "horrid" dreams, asked constantly about conspiracies, subpoenas, and citations for contempt of court, and felt, reported Louisa, that "the country was going to ruin, that his race was run, and his whole life work going for naught!"

    The party retreated to Cairo, then to the Grand Hotel in Rome. The Pope, the Kaiser, and the King of Italy sent messages of concern. Morgan rallied for a drive up the Janiculum to see the new buildings at the American Academy. He attended Easter services on March 23 at St. Paul's American Church. On March 31, just shy of his seventy-sixth birthday, he died in his sleep.

* * *

Two days later, a headline in the Paris Herald asked, HOW WEALTHY WAS HE? Toward the end of April, after the funeral and burial in Hartford, after memorial services in London, Paris, and Rome, there was a surprising answer. Morgan's fortune seemed to be less than $100 million. When his estate was finally settled in 1916, his American banking interests, securities, and real estate were valued at approximately $58 million, and his art collections at $20 million. He left another $2.5 million worth of property in England.

    The total value of the estate came to about $80 million (roughly $1.2 billion in the 1990s). Morgan had made plenty of money, but not nearly as much as people had imagined. In buying out Andrew Carnegie to put together U.S. Steel in 1901, the Morgan syndicate had paid $480 million, of which Carnegie personally received nearly half. John D. Rockefeller, already worth nearly a billion dollars by 1913, reportedly learned of Morgan's net worth from the newspapers, shook his head, and said, "And to think he wasn't even a rich man."

    Tributes to Morgan that spring centered on his "rugged honesty and rock- ribbed integrity." Theodore Roosevelt praised his "sincerity and truthfulness," The Wall Street Journal his "first-class mind," the London Times his "distinctly wholesome" influence on the stability of international finance. Others called him an uncrowned monarch and the "embodiment of the heroic age in American industrial history."

    Even some of Morgan's critics said he was a builder and conservator, not a wrecker, liar, or cheat. Joseph Pulitzer's World called him the "commanding figure" of a moribund financial feudalism: "Never again will conditions of government make it possible for any financier to bestride the country like a Colossus.... Having greater force, greater character, greater intellect and greater vitality than any other man in Wall Street, he naturally became the leader, and he remained the leader.... The system he built up with so much skill and effort is doomed to crumble.... In time little will remain except the feeling of bewilderment that a self-ruling people should ever have allowed one man to wield so much power for good or evil over their prosperity and general welfare, however much ability and strength and genius that man possessed."

    Samuel Untermyer told the press: "Whatever may be one's view of the perils to our financial and economic system of the concentration of the control of credit, the fact remains, and is generally recognized, that Mr. Morgan was animated by high purpose and that he never knowingly abused his almost incredible power."

    Morgan's famous remark before the Pujo Committee—that credit in the conduct of the world's business was based primarily on character and trust—came directly out of his own experience and applied above all to himself. By 1912, however, it was too late for a private banker to wield so much public power, and it was too late for Morgan to change.