PIERPONT MORGAN.

Auckland Star, Volume XLIV, Issue 77, 1 April 1913, Page 8

PIERPONT MORGAN.

GREAT FINANCIAL FORCE. •HIS VAST ENTERPRISES. The greatest financial force of the present day, J. Pierpont Morgan, has passed away in Italy, according to a cahle published on page five of this issue. How much capital Mr Morgan controlled cannot be stated with any degree of •accuracy, but hundreds of millions were at his call and disposal. Mr Carl Hovey, biographer of the great lAmerican banker, in his hook published last year, wrote: "Mr Morgan has become the dominant business force in the country and the strongest single financial power in the ■wliole world, and, as a matter of fact, he ha 6 reached a point where no one category will contain him. You cannot put Mr Morgan in the pigeon-hole of a class. He is a genius, a spirit, a very conspicuous instrument of the economic evolution ot his time. You cannot call him a mere money-maker, interested in temporary gains. He instinctively plans for something permanent in the structure of the ~mioncy-maldng activity; he has furnished the grooves in which all our industries shall ho run for a very long time to come. There are not two opinions on this point. 'Organiser' and 'constructive force' are almost hackneyed epithets as applied to him. The accepted description of. his work runs as follows: 'He was never a stock gamhlcr; never a bear. He never wrecked a property or depressed values that gain might follow. His work was always to reconstruct, to repair, to build up.*"

"Thirty-five yeans ago," says another American writer in a character sketch,

"Mr Morgan was practically unknown even injWall "Street, and he could hardly be called wealthy as wealth is now measured. By deep thinking and hard work he reached the foremost place in American ifinance. He is the most advanced expression of a new world movement, that of 'community of interest,' of consolidation: he caw that great combinations were to constitute the next step in the development of industry and commerce, and he took early advantage of hie sagacity. Mr Morgan, therefore, i 6 to be considered not as a millionaire, but as a man of original force. Whether or not he has used his unquestioned genius to the highest purpose, whether

ot not he deserves all the credit or all the abuse that he has received, are questions the future alone will be able to answer. Americans of gTeat wealth may be divided into two classes—those who are self-made and those who inherit their riches. The self-made millionaire, though by no means unknown in old Europe, is peculiarly an American product, and there is no story .which bites more keenly on our popular imagination than that of j the poor farmer lad l —never a plain "boy" ' —who hoed potatoes at twenty-five cents a -day. and grew to be worth twenty-five millions. To this claes belong such men as Huntington, Armour, the first Astor, the first Vanderbilt, Peter Cooper, Jay Could, Hill, and Pullman. They have ;ill been bold, active, fearless men, sometwncs rough and unpolished. sometimes unprincipled, always forceful and original. To their and successors tbr»-e men left their money, but rarely their force or daring. Passiveness, polish and conservatism naturally succeeded creative ability, and the later Astors, Vanderbilts, and Goulds have been conservators rather than creators. J. Pierpont Morgan possesses the somewhat rare distinction in America of belonging to both of those closes. Born to considerable wealth, surrounded in his youth by evidences of culture, and carefully educated, he could have led a life of leisure if it lmd so nleascd him. It was of his own motion that he chose a business career." " AH who knew Mr. Morgan in early life agree that from the very beginning he exhibited the cardinal feature of his character, the capacity for pursuing his own way without advice, and that, independent of his father, he worked with him rather as man with man than as son with father. In 1860, at the age of 23, he became the American agent for George Peabody and Company, of London, and with that firm his experience iliegan in the handling of large funds, and he acquired familiarity with the risks and responsibilities of great business transactions. At the age of 27 he helped organise the -firm of Dabney, Morgan and Company, and seven years-later, in 1871, be formed a combination with the wealthy Drexels, of Philadelphia, the firm being known as Drexel, Morgan and Company. In 1895 Drexel, Morgan and Company became J. P. Morgan and Company, and Mr. Morgan's father having died in IS9O, the London house of J. S. Morgan and Company, and the Paris branch of Morgan, Harjes and Company, with nil their connections the world over, fell under the dictatorship of J. P. Morgan, and to-day J. P. Morgan is the supreme director of all this great financial machine. " Comparatively very few people possess any very clear conception of what Mr. Morgan is or does in Wall Street. He is vaguely compared with Mr. Keene, who is a speculator; with Jay Gould, •who was a wrecker; with Hill and Hamman, who are strictly railroad men; with j the Astors, who are primarily real estate owners; with Carnegie, who was an ironmaster. But Mr. Morgan's business is purely that of a banker—a worker with .(money. As such he acts aa an agent for rich clients in the investment of money; he loans, borrows, transmits money abroad, issues letters of credit, and buys and sells securities which are ■the evidences of money. "Mr. Morgan impresses one as a large man, thick of chest, with a big head set close down on burly shoulders, features 'large, an extraordinarily prominent nose, keen grey eyes, deep set under heavy .brows, a high, fine forehead, a square, bulldog chin. His hair is iron-grey and thin, and his moustache is close cropped. For a man of his age and size he seems unusually active, moving about with almost nervous alertness. He is a man of few words, always sharply and shortly spoken. When a. man comes to him, Mr. Morgan looks at him keenly, waiting for him to speak first, and his decision follows quickly. '• Without what has been so well called ' the leaping nlind,' Mr. Morgan never could have accomplished what he has. Mr. Morgan does not spend many hours at his office, "and when he is there he rarely remains long at one desk. A man who has .been long associated with him tells how he ' leaped' through his correspondence, how he was often complete .master of. a proposition before the explanations were half finished, and the lawyers who drew up the papers for the Steel Corporation could hardly keep pace with his swiftly enunciated* plans. Indeed, Mr. Morgan is given credit in Wall Street not so much for his skill i in organising the Steel Trust as he is for : the speed with which the enormous task j was accomplished. On December 12, 1900, he attended a dinner given at the University Club by J. Edward Simmons, of the Fourth National Bank. Charles Si. P-hwrib v.t (hrrr.. a-, save an illtl-

minative address on the steel and iron industry. Mr. Morgan, though already a dominant factor in three steel combinations, had "never before' met Mr. Schwab,'but he was so impressed with his address, that he conceived the idea or a gigantic combination of the steel , interests in America. Three months later the largest corporation in the world was organised, with Mr. Schwab as its president, and the stock was on sale.. "Mr Morgan has never been a wrecker, like Jay Gould; he has always been an up-builder, or a creator. Most of his achievements have had for their object the saving of money waste. Rival companies compete and lose money; Mt. Morgan steps in and combines them, thus saving not only the losses due to the competition but economising also in administrative expenses. In times of great excitement in Wall Street, when panic and loss threatened the entire country, Mr. Morgan has been the first to come to the rescue with his money and credit, knowing that panic and uncertainty are among the most fruitful sources of loss to capital. In the panic of December, 1899, for instance, when call money reached one hundred and eighty-six per cent., Mr; Morgan at once poured several million dollars into the market, and instantly quieted the panic. For many years he has acted as a sort of balancewheel to the country's finance, wielding Ilia immense power and credit so as to steady the market when panic threatened.

"Mr. Morgan has been such a reorganiser and reconstructor of bankrupt corporations, especially railroad companies, that Wall Street has come to call the process re-Morganising.. He acts, sometimes, as a sort of expert financial doctor, called in to treat financial illness for a fee—and he knows as well how to charge as the best specialists in surgery."

During the great- financial panic of 1907 Mr. Morgan came to the rescue of the market, his action in purchasing the Tennessee Coal and Iron Company on behalf of the United States Steel Corporation being the most potent factor in relieving the situation. When Harriman died the Morgan interests went behind the railroad "king's" holdings and prevented a threatened slump' in the stocks.

His son, John Pierpont Morgan, will succeed to the control of the Morgan interests. The effect of to-day's news on the money market in America and in Europe is difficult to gauge. His life was insured for big sums by scores of brokers in ordeT to protect themselves against a slump on securities following his death. A Money Trust Investigation Committee was recently set up by the American Government to inquire into whether Morgan was at the head of a trust to control the flow of capital. That committee has not yet completed its work, and it made very little progress when it had Morgan himself in the box two months ago. He delivered some striking little remarks on work and character, but outside that gave the committee no assistance.