J.P. Morgan: The Man Who Owned all America part 3

The man of steel.

 

 

In 1901, Carnegie steel was at its peak. It dominated the steel industry and was one of the most valuable companies in the country. But despite it, netting, 40 million dollars, a year, Carnegie was ready to retire and wanted to sell his company. But who could buy are, that's where John came in, he basically told Carnegie to name his price and he did 480 million dollars, which would be more than any other business deal in history, and yet John agreed on the spot and later confessed, he would have paid a hundred million more John made the landmark purchase in 1901.

 

But this was just the beginning of his ambitious plan. He merged Carnegie steel with the federal Steel company and a few other businesses to form us steel the world's first billion-dollar corporation, which had a market cap of one point four billion dollars. Just to put that in perspective, all the manufacturing in the country, was capitalized combined. Nine billion. This deal gave John control of Rafi, two-thirds of the American steel production. So basically, two of the largest Industries at the time were steel. And railroads, and John had seemingly conquered both.

 

And he didn't stop there, John helped finance Thomas, Edison's early experiments with electricity. He then played an important role in merging Edison Electric with its competitors to create General Electric. And John was also influential in creating. What would later become AT&T? John's talent for combining companies together and turning them into Unstoppable. Giants were unmatched but unfortunately, a crisis was about to begin.

 

The 1893 Crisis.

 

In 1893, the United States was facing a depression. The likes of which had never been seen before after several decades of continued growth and unchecked Investments, the bubble burst and the American economy was plunged into chaos. Stocks plummeted losing almost half their value. Thousands of businesses closed their doors forever. Hundreds of banks went bankrupt and unemployment rates skyrocketed throughout the country. Price is scared of foreign investors who cashed in their American Bonds in exchange for gold slowly but surely depleting the US.

 

reserves. At the time, the dollar was still tied to the gold standard. Meaning, anyone could convert their paper money into physical gold and this had more confidence. Their paper money was actually worth something as a result. The American government always kept at least 100 million dollars worth of gold bullion on hand to back the dollar but by 1895 most of that gold was gone and the dollar’s value was in a sharp decline at its lowest, the government had no more than nine million. Hours’ worth of gold reserves which meant that it was in danger of defaulting on its loans at any moment. And of course, this run on gold just spread more Panic.

 

Having a domino effect where more investors pulled their money out of the US and depleted the reserves even further. The US didn't have a central bank at the time to rescue them and the situation was extremely dire, President Cleveland understood that this was a Crossroads moment for America that would forever alter, its course, the traditional strategy of Simply selling war bonds. To the American people wouldn't work fast enough. John knew this was the time for drastic and immediate action. So he traveled to Washington to meet the president and laid out his game plan to bring America back from the brink of an economic disaster.

 

John Doe Daysha's scheme was to form a private Syndicate consisting of the most prominent Bankers in the country who had worked together with foreign investors to shore up America's gold reserves his Syndicate, offered to purchase 65 million dollars worth of 30-year gold bonds using 3.5 million ounces of gold. Thanks to an old Civil War. Statute President Cleveland could agree to the deal, right then and there without having to wait for approval from Congress once. Cleveland signed, the agreement, John wired, his men in New York and told them to act and in only 22 minutes they bought out all the gold bonds, John's decisive actions had an immediate calming effect on the volatile Financial market and restored faith in the economy.

 

John had almost single-handedly saved them from Total claps and of course being the shrewd businessman that he was, he had also made a large profit from the Enterprise by securing generous rates on the gold bonds that he purchased. And this was John had saved the day and helped bail out the government. It also raised concerns Illustrating the vast When the power of one single Banker on the entire US economy, and some asked, whether his motivations were really patriotic, or simply opportunistic to line his own Pockets.

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