Morganization

Posted in Finance, Accounting and Economics Terms, Total Reads: 1086
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Definition: Morganization

Morganization is a term that was popularized after the ways of JP Morgan in his process of reorganizing troubled business and making them extremely profitable. He mainly made use of his reputation to drive in better interest rates for the organizations he lead.


Many claim that his ways were that of monopolization. In the nineteenth century, he used his network to lure European bankers to invest in the US by taking over an industry and then to make it profitability via the path of monopoly. This way, he turned the entire industry into a single entity that was extremely successful and profitable.


Morgan started with the railroad industry by taking on underfinanced companies, relatively small in size. Subsequently, he shifted attention to steel, banking and electricity industries in a similar fashion. The growth he could factor in into these infrastructural industries resulted in successfully transforming the United States from a borrowing nation to one that was in a position to lend money.

 

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