Original subtitles

- After the death of his father,

JP takes complete control of the House of Morgan,

consolidating the firm's branches under a new name,

JP Morgan and Company.

Morgan moves the official headquarters

from London to New York,

where the firm runs over 100 railroad lines

and a dozen major corporations

including General Electric.

- The House of Morgan touches and influences

almost every major part of the American economy.

- As JP's railroad empire grows,

he's ready to make his biggest move,

controlling every mile

of a new transcontinental railroad.

- With JP Morgan and Company

firmly established in New York

and a huge amount of capital at his disposal,

JP turns his attention to his railroads.

For years the railroad business has been chaotic.

Thousands of lines

with competing owners

have led to tremendous waste.

But as railroads become widely used

for moving goods across the country,

Morgan knows it's time to strike.

- The House of Morgan really understood

that railroad securities were going to be

an important part of their business,

of their brokerage.

It was America's first big business,

and the House of Morgan,

as America's premier financial institution,

was right in the middle of this industry.

- He already controls the major East Coast lines,

and his newest acquisition, the Northern Pacific,

now gives him access to the West Coast.

Soon JP will forge a new transcontinental railroad

and with it achieve what previous attempts

have failed to do,

dominate the American economy from coast to coast.

The first line to span the nation

started construction in 1862

out of need during the Civil War.

But it was soon mired in scandal

and fell into bankruptcy.

- The first transcontinental railroad

had had something of a checkered history.

Its builders had built fast so that they could get

government subsidies for the miles they were building.

They didn't care so much about building competently.

- JP plans to do what he does best,

using morganization to combine his lines,

creating the most efficient

and profitable railroad company in the country.

But Morgan is not the only one who has his sights

set on controlling a transcontinental line.

A determined young banker intends to overtake him.

- Meyer, check the mail room for delivery

from the Union Pacific.

I'm expecting an updated inventory

of their rolling stock today.

- German born investment banker

Jacob Schiff is managing partner at Kuhn Loeb,

the largest and most influential Jewish investment bank

on Wall Street.

- JP Morgan was 2 1/2 times as big as Kuhn Loeb

and Kuhn Loeb was the second biggest in the country.

- Schiff has worked hard

to bring Kuhn Loeb to its place at the top.

He single-handedly took his firm from obscurity

to Wall Street royalty,

but it hasn't come easy.

He's fought to overcome an obstacle

faced by Jewish people around the world.

Antisemitism.

- The major banking institutions in Wall Street

at the time were all anti-Semitic.

They had no interest in allowing any Jewish firms

to come in and participate with them in any kind of matter.

The result was that you had the Jewish bankers

and you had the WASP bankers,

and there was no connection between the two.

- We have to remember that Wall Street

was a very clubby place.

Deals were made over drinks at clubs

where only people from certain backgrounds could be members.

So Jews were often excluded.

It was about being part

of the trusted set of families,

being from the right background.

- For Jacob Schiff,

the discrimination serves as motivation.

He starts buying small railroad lines across the country,

becoming the first Jewish firm to do so.

- His strategy was to identify

up and coming underdogs and to invest in those.

He was able to see opportunities

and take risks

that the big houses simply didn't see

or didn't want to take

because they were too small or too high-risk.

- Before long, Schiff has an impressive portfolio

of East Coast railroads.

But now he wants

a West Coast line

the Union Pacific.

Once the greatest railroad in the country

and half of the first transcontinental railway,

now it's bled dry,

abandoned and driven into bankruptcy.

- The Union Pacific Railroad had massive debts

and it was in huge trouble.

- Schiff wants Kuhn Loeb to overtake

the House of Morgan.

To do that, he needs to take control of the Union Pacific.

But to avoid making an enemy of the most powerful banker

on Wall Street,

he needs Morgan's blessing.

- We think of JP Morgan as a banker and a financier,

but he was really a power broker.

He was a politician.

There was a period in time

from the late 1800s to the early 1900s,

where if you are in railroads, steel,

any major industry,

at some point in time,

you were gonna have to sit down across the desk

from JP Morgan.

- My new yacht.

It's very impressive.

- 300 feet.

A crew of 70.

Most importantly a humidor.

- Oh.

- You care to join me?

- No, thank you.

I'm interested in buying the Union Pacific.

- Really?

- Which is why I've come to you out of respect.

If you have any interest, I won't pursue it.

- Why in the world would you think

that I would want anything to do with that disaster?

- It's in rough shape, but I see potential.

- Did I miss something?

- Probably not. It's just a feeling I have.

And what's life without a little risk.

- I'll leave that to you.

- Congratulations on the boat.

- Yacht.

- Oh.

- Though Morgan sees no threat

in the long-abandoned railroad,

he sees one in Jacob Schiff.

With Morgan's consent, Schiff quickly buys up the rights

for the long-neglected Union Pacific.

He is convinced he can turn it around

and create a thriving, profitable transcontinental railroad

to compete with Morgan's lines.

But now he has a new problem.

He needs the money to do it.

- John Rockefeller was the great monopolist of the era.

His Standard Oil Company

had 92 plus percent

of the refining capacity of the country.

If you added up the value of all of his Standard Oil,

at that point, he probably was the richest man in America.

- Jacob Schiff's plan is to turn one tycoon

against the other,

offering something priceless to Rockefeller,

the opportunity to hurt JP Morgan.

- Mr. Rockefeller.

I remember the newspaper accounts

of when the golden spike was driven like it was yesterday.

To think that the Union Pacific

would be in the condition it is today

is a travesty.

But for all the damage Mr. Gould did,

the line's most valuable asset still remains,

it's potential.

Same potential that provided the drive

to see it built in the first place is still there.

With strong and honest management

and the proper infusion of capital,

I believe the Union Pacific

can provide the spine

of an unmatched network of commerce,

not only within our borders,

but as a global link to South America

and the Far East.

I can only imagine how this might serve

to expand and strengthen

your family's business interests

to say nothing of providing an alternative

to Mr. Morgan's Northern Pacific.

- There are an incredible amount of stories

about some of the greatest titans in the world

becoming emotional effectively,

deciding that they need to do something

not because it will make them money

but because it will humiliate their competitor.

Not just to beat their competitor,

to take something from them,

but to really humiliate them.

You saw that of course, back in the robber baron days

with the JP Morgans and the Rockefellers.

There was an intense competition between them.

- Good to send.

- Schiff secures

over $200 million from Rockefeller.

His transcontinental line is within his grasp.

The backing of the Rockefellers

doesn't go unnoticed by JP Morgan.

But now Jacob Schiff must avoid the pitfalls

that brought the line to ruin,

making sure that not a dollar is wasted.

- Sir, with all due respect,

I'm well aware of the line's assets,

but by my calculations,

mileage has been reduced by almost half

since the line's inception.

As for debts-

- Jacob Schiff was extraordinarily detailed

in every single aspect.

And he did it himself.

- And to say nothing of the three decades worth

of accumulated unpaid interest.

- He was competent, knowledgeable about everything

that he invested in.

- Well, I understand,

but if we're going to continue this conversation,

I'm gonna need you to negotiate in good faith.

I do my homework, sir.

- Nobody was more painstaking about the assets

that he controlled.

When he acquired a railroad line,

he would travel that line personally,

and he would really examine every inch,

every foot, every mile.

- Schiff uses

Rockefeller's money to bring the Union Pacific

roaring back to life.

JP Morgan now knows Schiff is in a position to compete

and that he needs to be two steps ahead.

Morgan partners with the greatest railroading mind

at the time, James Hill,

who takes over management

of Morgan's nearly complete transcontinental line.

With demand for the Union Pacific rapidly increasing,

the only thing Schiff is missing

is his own strong management.

He reaches out to Edward Harriman,

head of the Illinois Central,

one of the best run,

most profitable railroads in the country.

- Edward Harriman had started out on Wall Street

but quickly moved into running railroads

and proved himself to be

a remarkably adept and skilled manager.

- Schiff always was seeking out ways

of creating partnerships.

So he says to Harriman, "All right, what's your price?"

And they strike a bargain.

- Within three years,

the Union Pacific pays back all its debts,

laying over 32,000 miles of track.

It becomes one of the most traveled lines

in the Western United States.

- Schiff would hire people

and put them in positions of power

who he knew were leaders of the industry,

who he knew could turn railroads around.

He recognized ability and he rewarded it enormously.

That was how the Union Pacific became

one of the most powerful, valuable assets in America.

- JP Morgan has been tracking the revival

of the Union Pacific

and he knows Schiff is closing in

on a transcontinental railroad,

one that could rival his own.

But any railroad crossing the country

must connect with the Chicago-Burlington-Quincy Railroad,

also known as the CBQ.

So Morgan and Hill have been strategically buying up

control of the CBQ.

- Well, what was at stake in the competition

for the Burlington was basically that it was a keystone

of the ambitions of both tycoons.

- All they would tell me is that someone's buying up shares

and lots of them.

- Do you want me to look into it?

- No, I have a pretty good idea I know who it is.

- Jacob Schiff knows all the players

and suspects an old friend.

James Hill.

- Jacob Schiff, he had a relationship with James Hill.

- They used to socialize together.

Hill would spend time with Schiff.

They talked a lot. They was close friends.

- If Morgan and Hill gain control of the CBQ,

they will render the Union Pacific worthless

and be that much closer

to forming their own transcontinental railroad.

Schiff needs to confront Hill

or he could lose the millions he's invested

into his railroad.

- So Jim, I'm just gonna come right out and ask you.

Are you and Morgan going after the CBQ?

- Oh, of course not.

- Well, no offense intended, my friend,

but I am trying to buy it.

And I'm running into some trouble in the form

of a very aggressive competitor for the stock.

- Well, Jacob, last time I checked,

we're not the only ones buying railroads.

- Yes, but I figured I'd start with the men

who had the most interest.

- Well, the way you're talking,

it sounds like maybe we should.

- I'm going to take that as the joke it was intended to be.

- You know me too well.

- This is an era in which a man's word was his bond.

There was a point at which Harriman and Schiff

discovered that there was another bidder

for the Burlington.

They figured that it had to be Hill

and Hill basically said, "No, we're not."

And that was a lie.

In fact, it was a flagrant lie.

- But as the days pass, shares of the CBQ

continue to disappear at very high prices,

prices Schiff knows only one man would be willing

or able to pay.

- A showdown between the Hill-Morgan

and Harriman-Schiff camps was inevitable.

They were both competing for primacy

in the same part of the country

and along the same route.

- Gentlemen, apologies for asking to meet

so late in the day

but after my conversation with Jim,

it occurred to me that I may have been lied to.

- It's just business.

- Then let me suggest in the spirit of good business

to offer shares in the purchase to me and my partners.

- I'm Sorry, Jacob-

- We want it all.

- I have remained a gentleman regarding this matter

and have acted only with the utmost respect

but this is a hostile act

and it will be dealt with accordingly.

- Wall Street in and of itself is a competition.

Don't let anybody tell you different.

There's always a scorecard being kept

and they wanna do nothing more than outdo their competitor.

- JP Morgan seized control of the Burlington

before Schiff ever really had a chance.

It's a devastating blow for Schiff.

Without the Burlington line,

all of his work and the millions he's invested

will be for nothing.

Desperate, Schiff is unwilling to surrender.

While Jacob Schiff plots his revenge,

JP Morgan moves onto something even bigger,

the creation of a new corporation

unlike any the world has ever seen,

a company that promises to dominate

the steel industry worldwide.

- Morgan had gained most of his control over the economy

through railroads but now he's branching out

into other industry.

And Morgan discovered that steel

was as poorly organized as railroads had been

and he thought that he could do something

with the steel business.

- For JP Morgan, railroads and steel

are inherently tied together.

By controlling the entire supply chain,

he maximizes his profits in both industries.

On March 2nd, 1901,

JP Morgan shocks the world

with a monumental announcement,

the creation of US Steel.

- The largest corporation in the world at the time,

the first billion dollar corporation, United States Steel.

- In the industries that he commanded,

his goal was consolidation.

- He buys out Andrew Carnegie

and moves to take total control.

- When J. Pierpont Morgan formed US Steel

and acquired Carnegie Steel for $480 million,

it was unprecedented.

- Striking awe in friend and foe alike,

JP Morgan becomes the toast of the financial world.

- When Morgan announced the creation of US Steel,

you know, there was incredible excitement about this.

Imagine the first billion dollar company,

controlled by Morgan

who everyone understood to be powerful, influential,

and up to that point, pretty successful.

- The US Steel deal

doesn't just enrich the men behind it.

The confidence it instills in the stock market

triggers the strongest bull run in years.

With Wall Street so awash in shares,

the New York Stock Exchange declares a special holiday

just to catch up on paperwork.

- More and more people were investing in the market

who got caught up in what became a frenzy.

- As the stock market drives higher,

one stock is leading the pack,

JP Morgan's Northern Pacific Railroad.

- They had to hire more clerks in the office

to deal with all of the mail and other requests

that they were getting for the stock.

- Nearly 4,000 miles away,

JP Morgan basks in his victory.

- Morgan took this opportunity

to go on his customary trip to Europe

where he would spend his time basically taking the waters

in the South of France

but also building up his art collection,

buying paintings and sculptures.

- With Morgan distracted,

Schiff sees the perfect opportunity

to exact his revenge.

- Yes, Gramercy 302 please.

Yes, I'll wait.

Yes, Harriman, Schiff.

You see the paper?

Well, I suppose I'd ask you for a favor.

- Schiff saw a target.

They noticed that the executives

were distracted by US Steel.

Morgan himself was out of the country

and most people

never expected anyone to challenge Morgan.

- Meyer, that list of brokers.

I want you to spread those buys out evenly among them.

So buy 10,000 at 50,

12,000 at 52, 15,000 at 55.

Don't worry if you don't get the exact cost

as long as it's close

and you get the shares.

Go!

- Schiff starts quietly buying shares

of Morgan's Northern Pacific.

- They were attempting a hostile takeover of the railroad

controlled by the most powerful financier

and one of the most powerful railroad executives

in the country.

It was a very bold move.

- Schiff moves to the next phase of this plan,

manipulating the press.

And he has just the vehicle to do it,

"The Wall Street Journal".

Founded by Charles Dow and Edward Jones in 1889,

the financial industry now has its own instrument

to help keep up with and understand the markets.

And also of course to influence them.

- When you view events

from a larger canvas,

McKinley's election clearly set a pro-business tone.

And the bullish environment

created by Mr. Morgan's new steel conglomerate

is an obvious factor.

As for what's driving Northern Pacific's price,

don't quote me by name.

My partners will have my head.

But I believe Morgan and Hill's acquisition

of the CBQ Railroad

has captured American investors' attention

and they're voting with their wallets.

It's a safe bet.

- To keep Morgan and Hill in the dark,

Schiff executes a brilliantly simple plan,

using the bull market as cover

while planting flattering quotes in the press

to explain the Northern Pacific skyrocketing price.

- Schiff's and Harriman's buying of Northern Pacific stock

was driving the price up bit by bit

but it didn't occur to either the House of Morgan

or Hill that it was buying by a competitor

because the entire market was rising.

- As the price neared $70 a share,

shareholders keep selling to Jacob Schiff's brokers,

thinking it can't possibly go higher.

- Oh, but then as the stock price continued to increase,

James Hill started to wonder what was going on.

- As Schiff nears majority control

of the Northern Pacific,

Hill pieces together what's happening

but can only hope he's not too late.

- Jim.

What a pleasant surprise.

- Is it you?

- I thought you were in Seattle.

- I asked you question.

- Have a seat, Jim.

It's over.

- You can't possibly get control.

Morgan and my friends alone have $40 million worth

and I'm sure none of them has sold a share

as far as I know.

- What do any of us really know?

- How much do you have?

- A lot, Jim. A lot.

More than enough.

- Well done, my friend.

- While JP Morgan is distracted,

Jacob Schiff has seized control of his biggest railroad,

taking revenge on a scale

no one could have imagined.

- Throughout the history of finance,

no matter what, investors always want to kind of win.

And they're willing to sometimes do whatever it takes

to crush the competition.

- Desperate, Hill fires off

a frantic telegram to Morgan.

- Send a cable to New York.

James, regarding Northern Pacific,

assume he's lying or pray he's wrong.

Time is of the essence.

Marshal our resources to NYC for Monday open,

approving order to buy 150,000 shares

at any price.

What are you waiting for? Send it.

- Hill alerted the Morgan forces

who were caught basically unawares.

In fact, the House of Morgan had been selling into the rise.

So they'd been selling shares

that Hill was going to need to protect his position.

- He understood immediately the threat

that Schiff and Harriman had created

and that there was only one way to stop them now.

- JP refuses to give up

and dispatches all his resources

to stop Schiff from winning.

A team of Morgan brokers have orders

to buy up all the Northern Pacific stock at any price.

It's a desperate plan,

driving the price from $70 to over $100 by noon.

- We need to talk.

Something's going on with Northern Pacific.

It's over a hundred and it's not stopping.

- It's Morgan.

- How?

I told Hill we have control.

- Actually that may not be the case.

- Meyer, cancel all my appointments for the afternoon.

- Schiff misunderstood and ultimately miscalculated

what was required to take control

of the Northern Pacific.

- Jacob Schiff didn't expect Morgan

to spend as much as he did in a single day to stop him.

And Morgan's bet has paid off.

With his army of buyers he is able to take back control

of the railroad.

Schiff spent months secretly investing over $80 million

and still couldn't beat Morgan.

- The price of Northern Pacific

essentially went through the roof.

It went from $141

to 200, 300, 400,

500, 700, and peaked at a thousand dollars a share.

- Ego gets the best of you.

And those one-on-one battles

between one titan and another

end up being because one person or two people

won't let their egos take the hit

that maybe needs to be taken.

And for that reason sometimes,

you'll have one really big winner

and then one really big loser on the other side.

- He just wasn't big enough to compete when he started.

He couldn't do it.

Nobody could compete with Morgan.

- Morgan has crushed Jacob Schiff's attempt

at a hostile takeover.

But now there's a bigger problem.

The market for Northern Pacific stock refuses to die.

As Morgan drove up the price,

speculators have been furiously shorting the stock,

waiting for the bubble to burst.

- When people talk about shorting stocks,

it sounds complicated, but in essence all it is

is a bet against a company

and borrowing that investment from somebody else

and then paying it back when that stock is actually lower

sometime down the line.

- Short selling is inherently risky

because you're betting not only on something

that can go down, but your bet is basically predicated

on the idea that you could potentially lose everything

that you have at stake

and even potentially more.

- As the short sellers bet against the stock,

the price keeps rising,

forcing them to liquidate other stock holdings.

- Oftentimes with short selling or shorting stocks,

you then have to make good to somebody else.

When you short stocks or sell them short,

you have to borrow money or put up collateral

in some ways that could be wiped out

if a stock goes the wrong direction for you.

- The fever infecting Northern Pacific

has now spread to the rest of the stock market.

And it's threatening

to take it all down.

- The competition between Morgan and Schiff

really did cause a crash

and it did cause a panic in the market.

Dozens, if not scores of brokerages

were basically facing bankruptcy.

It was a disaster in the making.

- Reporting on the devastation,

headlines placed the blame

squarely with JP Morgan and Jacob Schiff.

- One of the big consequences

of the Industrial Revolution

and all of the folks who financed it

was the competitive nature of the individual players here.

There became a competition so intense

that it became less about money

and it became about ego and pride.

This was personal.

And what some of these guys did

in order to hurt the other person

it ended up not only hurting them,

but it ended up hurting the whole economy.

- Jacob.

- Something has to be done about this.

- You say that as if this is my fault.

- I certainly wasn't the one who sent an army of traders

with sacks full of cash to drive Northern Pacific

through the roof.

- The goal was to reclaim what's mine,

what was being stolen from me under cover of darkness

by you and Harriman.

- Which never had to happen

had we merely been given the respect we deserve,

had I not been lied to to my face.

- The market is in free fall

and your first thought is to barge in here

and absolve yourself of all responsibility.

- I will own up to my role,

but you and I both know,

either of us could have done what I did.

Only one of us has the power to take the actions you did

because you simply cannot bear to lose.

Better the world crumble down around you.

- I will never let that happen.

- Schiff and Morgan ultimately realized

that the battle that they had waged

over the Northern Pacific had had a terrible impact.

- They understood immediately

that they had to calm the market,

that they had to intervene.

- They were forced to work together.

So when they met, that was the tension

that was in the room was this sense

of mutual distaste, mutual distrust,

but a need to work together.

- The two men quickly hammer out an agreement

to bail out the short sellers,

allowing them to buy up shares at only $150

to cover their bets,

a fraction of what it would have cost them.

- They gave the short sellers extra time

to conclude their deals

and essentially quieted the market down.

It didn't mean that small investors didn't suffer

but it did prevent a catastrophe.

- While the two rivals

have found a way to move forward,

the public is still reeling from the panic

and not nearly as forgiving.

- The panic basically brought home

to ordinary Americans as well as to small investors,

that there was a concentration of capital

and a concentration of power

that could not actually be trusted to work

in the public's interests,

that had to be reigned in in some way.

- There was a growing sense of anger and concern,

despair among some that there was a group of people

who were becoming wealthier,

who were exerting more control,

who had a lot of influence and power.

- Starting in the 1870s,

there had been the emergence

of a coherent labor movement in America.

And this was the first time that ordinary,

sort of working class people

developed organizations to promote their interests.

Now, at the left wing of the labor movement

were left wing, radical unionists

and slightly down there were the anarchists

who basically wanted to bring down

the capitalist system.

- The public holds JP Morgan responsible

for the panic.

But as social unrest grows, he refuses to apologize.

- Morgan was an aristocrat

and he really didn't pay too much attention

to what public opinion was about him.

He believed that he was right

and that was mostly enough for him.

- JP Morgan is often credited with saying,

"I owe the public nothing."

Now, if he actually said that or not, that's debatable,

but the sentiment behind it, it was classic JP Morgan.

And in fact it was a sentiment

shared by a lot of bankers then,

and to a certain extent, a lot of bankers now.

Many of them wouldn't be brave enough to say that out loud

in front of a camera or in front of the public.

These aren't people who are doing this because of altruism.

They got into this business to make money.

- As Morgan and the financial elite

solidified their grip on the nation,

some take their protests to new extremes.

Anarchist violence

breaks loose in the aftermath

of the Haymarket Riots in Chicago.

- What we have to remember

is the early 20th century

was a period of very intensive

and frequent political violence in the United States.

There was a large mobilization of people

against what they saw as wealthy fat cats

who they thought was not allowing them

to have access to our democracy.

And so there was a widespread anarchist

revolutionary radical movement.

- Bombings, shootings, and riots

filled the headlines

while death threats reach even the most guarded members

of society like JP Morgan.

It becomes clear. No one is safe.

On September 14th, 1901,

the president of the United States, William McKinley,

is assassinated, a close friend and ally of JP Morgan.

The President is gunned down by an anarchist

enraged over Wall Street's stranglehold

on the American economy.

- Leon Czolgosz, the guy who shot William McKinley,

was a self-professed anarchist.

And when it became apparent that an anarchistic

had killed the president of United States,

the shock was much like if a terrorist

had somehow managed to assassinate

a president of the United States sometime after 9/11.

- The radicalism of this moment

was inspired by the inequities

and what were seen as grave disparities

in the way our economy and our democracy operated.

- The murder of President McKinley

elevates a trust buster to the nation's highest office.

Theodore Roosevelt is committed to taking on

the massive trusts that dominate the country.

- There was a lot of pressure

to address the problems of monopoly.

Theodore Roosevelt sees antitrust activities

as a key way to prevent a few families

from dominating the economy.

- His first order of business

is to go after the biggest monopolies on Wall Street,

most of which are controlled

by one man, JP Morgan.

- Roosevelt was picking a fight

for the purpose of picking a fight

and he thought, well, if you're gonna pick a fight,

you know, you pick the biggest bully around,

the person who's perceived as the biggest bully.

You know, taking on

the JP Morgan.

- Morgan in particular

and some of the other Wall Street folks

were pretty wary of him.

Roosevelt had a reputation as a reformer.

He had taken on Wall Street

when he was governor of New York.

And you know, they viewed him

as impetuous, unpredictable.

- Roosevelt brings a case

against Morgan's Northern Securities,

a railroad trust containing

over 40 different railroad companies,

including those that make up

Morgan's transcontinental line.

- Morgan instantly understood

that his efforts to concentrate power in his enterprises,

that these were actually in great danger.

- Roosevelt's lawsuit against Morgan

is taken up by the Supreme Court,

which sides with Roosevelt

and shatters the Northern Securities Company.

- Nobody would go after Morgan and TR was utterly fearless

and it threw Morgan into a kind of conniption

that this cowboy pipsqueak guy

who's an accidental president is suddenly telling me

I have to break up my business assets.

- Morgan came of age at a time when presidents

were not very powerful.

The people who actually understood power,

the people who managed power,

were people like himself and he wasn't wrong.

That's how American power was built

in the second half of the 19th century.

- Forced to disband the trust

and manage each railroad independently,

each line is left to compete on its own,

leading to a loss of control and profits.

And Roosevelt has Morgan's greatest triumph,

US Steel, targeted next.

Knowing he can't take down the President,

to protect his interests,

Morgan knows he needs more leverage,

a way to turn Roosevelt into an ally.

His massive shipping trust has deep roots

in Central America.

He plans to use his connections in Panama

to give the President something he's longed for.

- Theodore Roosevelt was a naval historian.

So he recognized that a shortcoming

for American national security was our inability

to move our Atlantic fleet

together with our Pacific fleet.

Just as the transcontinental railroads

were connecting east to west,

Theodore Roosevelt wanted to create a pathway for our ships

to go from east to west or west to east.

- The French have partially completed

a canal in Panama,

but they won't sell the land rights

for less than $100 million.

It's too expensive for the American government

so Congress recommends to Roosevelt

the only other alternative, Nicaragua,

a route that would be twice as long.

Morgan must persuade the President to defy Congress

and back Panama instead.

- Mr. President.

Thank you so very much for meeting with us, sir.

Mr. President, as you know,

I pursued financing for a Nicaraguan canal

prior to the financial difficulties of 1893.

Is it a workable option? Yes.

But with all due respect to the commission,

the Panamanian site is superior.

The French for all their missteps

have already completed a substantial amount of the work.

With our far better American engineers,

we will be able to overcome whatever obstacles

stood in their path.

Mr. President, I do understand your hesitancy,

but I have not arrived at my opinion

without the utmost consideration.

- Morgan promises Roosevelt

he will use his influence and resources

to secure a better deal from the French.

- Theodore Roosevelt needed the very bankers

he attacked sometimes

because he wanted to build American power internationally

and he needed capital for that.

The US government did not have enough money

to do it on its own.

- Now, Mr. President, if you were amenable,

I'd be delighted to go over the Panamanian details with you.

Thank you, sir.

- Morgan convinces the President

and offers to pay the French for the land rights upfront

and entirely in gold.

It's so unbelievable that JP is able to cut down the price

from 108 million to just 40 million,

the modern day equivalent of just over a billion dollars.

- To give you an idea of how much money that was,

it's more than the US paid for the Louisiana Territory,

Alaska, Hawaii, and the Philippines combined.

Roosevelt chose Morgan

because it was the only banker

in the world that could perform this feat.

- For Pierpont, money and power were one and the same.

Money was a currency of power.

Some use guns to get control, others use money.

Pierpont recognized that in the late 19th century

money was a more effective tool for control than guns.

- Money well spent.

Transport'll be here

in an hour.

Roosevelt names Morgan

the US government's agent to Panama

and the country's official banker.

Leading the way, JP turns Wall Street

into an international power.

The Panama Canal is the largest public works project

in the history of the world.

Every dollar spent passes through Wall Street.

Morgan's US Steel and General Electric

make millions creating the materials needed

all of which are transported

on his rail

and shipping lines.

- Morgan was making money in the Panama enterprise

before, during, and after the construction

of the Panama Canal.

The Panama Canal was Morgan's entry

into the world stage

where kings and emperors had entered before.

He was able to manage the probably most expensive

and greatest engineering construction work of all time.

- JP Morgan

has reshaped the world

in what is undeniably the biggest engineering feat

of all time.

He did this while turning a would-be enemy into an ally.

His trusts are now safe from Teddy Roosevelt

and he's never made more money.

His empire expanded beyond even his wildest dreams.

JP Morgan has reached the pinnacle,

the king of Wall Street,

the most powerful banker on earth.

But his greatest challenge is yet to come.

New rivals.

- This company has the know-how to succeed.

- And new industries emerge.

- If Morgan can't see that,

he's making a big mistake.

- But when the greed of lesser men

threatens to tear it all down,

it brings on a crash the likes of which

the nation has never seen.

- This is for Knickerbocker.

We already know Knickerbocker is failing.

- While everyone looks to one man

to stop from destroying them all.