Panic of 1907

I was reading an article the other day called "The Panic of 1907" describing the financial fiasco that included a U.S. Stock Market crash, bank failure internationally, and a $15 billion loss (in today's dollar). At the time J.P Morgan was our Warren Buffet of today. However, when J.P. Morgan heard the news of the economic system collapse, he did not panic but held strong. Which would make sense because you could imagine how you would feel if you knew Ben Bernanke was nervous.

At this point, the Fed did not exist. A hard fact to grasp today.

Morgan appointed George Baker of First National Bank and James Stillman of National City Bank to decide which trust companies should be allowed to fail and which could survive with a cash infusion. This is similar to today but unfortunately I think we are decided bank failure on which name failing would be the biggest shock. For example, Bear Stearns could not fail because it was such a HUGE name in the business...

Regardless of the economy, New York City as a city had to be saved. This caused Morgan to gather 50 trust company presidents and asked them to come up with $25 million. Morgan required each to take place in the $25 million loan.

This panic of 1907 made people determine that a country's financial welfare could no longer be left in private hands while today we are facing a similar conclusion based on which side of the fence you stand on.

Morgan did not do this for his personal gain, he lost $21 million. This kind of patriotism for the nation's well-being is what we need today. Someone who sees beyond their personal loss and sees a nation's loss. Who is willing to lose $21 million in order to save 21 million jobs? Although what drives a lot of our economy today is based off of self-interest and greed, today we need some selflessness.

We need to be paying attention to which leaders are fighting for the American people and which are using the American people as a disguise for personal gain.


Source: www.courier-journal.com