On this day in economic and business history …
When most people think about JPMorgan Chase & Co. (NYSE:JPM), it’s the first part of the megabank’s name that stands out. J.P. Morgan was a legendary financier, but he was not the earliest foundation of the bank that now bears his name. That honor belongs to the Bank of the Manhattan Company, predecessor of Chase Manhattan and only the second bank established in New York City. The Bank of Manhattan was established on Sept. 1, 1799, born out of one of the most legendary political rivalries in American history. David Wallechinsky and Irving Wallace tell the tale of the Bank of the Manhattan:
On April 2, 1799, the New York State legislature granted a charter to the president and directors of the Manhattan Company to supply New York City with water. The charter included a clause that could be interpreted as a permit for the company to invest excess funds in banking. The clause was included by one of the founders, Aaron Burr, who wanted to compete with Alexander Hamilton’s Bank of New York, which then had a monopoly on New York’s banking business.
On Sept. 1, 1799, the company bought a house at 40 Wall Street for $30,000, and Hamilton’s Federalist Party’s monopoly on banking was broken by Burr’s Republican Party. The current Chase Manhattan Bank [this was written before the JPMorgan Chase & Co. (NYSE:JPM) merger] is still operating under that 1799 charter, making it the oldest bank in the country operating under its original charter.
The Bank of the Manhattan Company stopped supplying water to New York in 1842. It merged with a number of banks, including the Merchants National Bank (founded in 1803), the Central National Bank of New York, and the Seward National Bank and Trust Company.
The Economist dug a little deeper into the bank’s background, and Burr’s machinations:
After an epidemic of yellow fever in 1798, in which coffins had been sold by itinerant vendors on street corners, Burr established the Manhattan Company, with the ostensible aim of bringing clean water to the city from the Bronx River but in fact designed as a front for the creation of New York’s second bank. …
Once Burr had persuaded the city’s politicians to approve a permissive charter allowing his company to undertake in effect whatever commercial activities it liked, water was always a secondary consideration. The Bronx supply never materialized, and for years New Yorkers had to make do with water fed into public wells and standpipes from the increasingly unhygienic Collect Pond, on the edge of the settled area.
The Manhattan Company merged with Chase National Bank in 1955 to form Chase Manhattan, and this augmented bank was acquired by Chemical Bank, another notable New York financial pioneer, in 1996. The present-day JPMorgan Chase & Co. (NYSE:JPM) is more directly descended from Chemical Bank than either J.P. Morgan, Chase National Bank, or the Bank of the Manhattan Company, but the company can still trace its lineage back to the schemes of Aaron Burr in 1799.
The war that changed everything
World War II began on Sept. 1, 1939, with the German blitz of Poland. A day later, The Washington Post declared what everyone already knew: A Second World War was inevitable.
Europe today entered what may be the second day of the Second World War, with three German columns smashing deeply into Poland and with the French and British governments expected to declare war before the day’s end.
Sole hope lay in the unlikely possibility that Adolf Hitler would bow to a joint British-French “ultimatum” demanding that he called off his undeclared war on Poland.
German planes had bombed more than 20 Polish cities. There were reports of growing casualty lists. But Germans stoutly asserted, as did the Japanese in China, that only “military objectives” were bombed.