When John Pierpont Morgan bought off President Grover Cleveland in 1895
The day that put the bankers in charge of the U.S. economy.
In February 1895 President Grover Cleveland was forced to strike a deal with J.P. Morgan (his bank is now known as J.P. Morgan Chase) which saved the United States Gold Reserves. At the time the United States was in the midst of a terrible depression and Cleveland's popularity was rapidly dwindling. Cleveland had continued to support the traditional gold standard while his party gradually jumped ship and merged with the Populist, bimetallic platform.
Understanding the crisis that the nation would undergo if the United States gold reserves disappeared, J.P. Morgan, magnate/financier, offered to help the government. Morgan (with a profit clearly in mind) offered to form a syndicate (headed by himself) which would buy bonds from the United States in exchange for 62 million dollars worth of European gold. Cleveland, unable to see an alternative, and realizing that it would be a matter of days before the gold reserves disappeared completely, agreed to the plan, and organized the bond sale. With the deal settled, the dollar managed to recover some of its value, and Cleveland could rest easy, knowing that the gold reserves were safe.
However, when news of this deal broke, public opinion turned against Cleveland even more than before. When people learned how profitable the deal turned out to be for the banks, who had immediately resold the bonds at marked-up rates, more contempt confronted Cleveland. There were even rumors that he had profited personally from the deal. The issue only helped to accelerate the decline of the Gold Democrats.
Populists jumped all over the issue, shouting that it was yet another example of Washington being in league with the international banks and Wall Street. To the Populists it was the perfect example of a conspiracy against the common man. There was an Antisemitic thread to their argument as Populists railed against the Rothschild House (a bank which was a member of the syndicate) as the source of the conspiracy, trying to suggest that Washington and Wall Street were in the hands of the Jewish banking houses of England, and that soon all of America would be as well.
by Ben Macri