The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance

Born in Danvers, Massachusetts, he had only a few years of schooling. When he was a teenager, his father died, and Peabody worked in his brother’s shop to support his widowed mother and six siblings. When he later prospered in a Baltimore dry-goods business with a rich older partner, Elisha Riggs, he remained haunted by his past. “I have never forgotten and never can forget the great privations of my early years,” he later said.3 He hoarded his money, worked incessantly, and retained a lonely air. (View Highlight)

Evidently he was mightily pleased by the books—capital of £450,000, a caliber of business only one rung below the houses of Baring and Rothschild. So in October 1854, he was admitted into partnership, and he settled into new walnut-paneled headquarters at 22 Old Broad Street. (View Highlight)

And he began to lecture his son, often at wearisome length, on the need for conservative business practice; the 1857 panic would be the text of many sermons. “You are commencing upon your business career at an eventful time,” he wrote. “Let what you now witness make an impression not to be eradicated … slow &, sure should be the motto of every young man.”25 Junius Morgan developed a lofty disdain for price competition and adopted the royal passivity of the Rothschilds and the Barings, who refused to offer cut-rate terms: “If we cannot keep the account on such a basis we must be content to let others outbid us.” (View Highlight)

Pierpont alerted his father to Vicksburg’s fall in July 1863—in time for the elder Morgan to profit from a sudden rise in American securities. Such calamity trading wasn’t thought bloodthirsty or reprehensible among merchant bankers but had an honored place in their mythology. As one Rothschild boasted, “When the streets of Paris are running with blood, I buy.” (View Highlight)

As a contemporary said, “Uncle George, as Americans … call him—was one of the dullest men in the world: he had positively no gift, except that of making money.” (View Highlight)

“It is not easy to part with the wealth we have accumulated after years of hard work and difficulty (View Highlight)

Perhaps as a young man Peabody had worked too much for others and as an adult too much for himself. In any event, he could do nothing by halves and again went to extremes. (View Highlight)

As he lectured Pierpont, “Never under any circumstances do an action which could be called in question if known to the world.” (View Highlight)