Besides the issue of loans there was another source of profit: thepurchase and sale of American stock which the Allies surrendered sothat they could buy munitions in the States. It is estimated that in thecourse of the war some 2000 million [two billion] dollars passed in thisway through Morgan's hands. Even if the commission was very small,transactions of such dimensions would give him an influence on thestock market which would carry very real advantages....
His hatred against war did not prevent him, citizen of a neutralcountry, from furnishing belligerent powers with 4,400,000 rifles for amatter of $194,000,000.... The profits were such as to compensate tosome degree his hatred of warfare. According to his own account, hereceived, as agent of the English and F r e n c h g o v e r n m e n t s , acommission of 1% on orders totalling $3,000,000,000. That is, hereceived some $30,000,000.... Besides these two chief principals,Morgan, however, also acted for Russia (for whom he did businessamounting to $412,000,000) and for Italy and Canada (figures for hisbusiness with the last two not having been published)....
J.P. Morgan, and some of his partners in the bank, were at the time shareholders in c o m p a n i e s that were ... concerns which m a d e substantial profits from the orders he placed with them. .. It is really astonishing that a central buying organization should have been confided to one who was buyer and seller at the same time.1
GERMANY'S U-BOATS ALMOST WON THE WAR
But there were dark clouds gathering above Wall Street as the war began to go badly for the Allies. With the passage of time and the condensing of history, it is easy to forget that Germany and the Central Powers almost won the war prior to U.S. entry. Employing a small fleet of newly developed submarines, Germany was well on her way to cutting off England and her allies from all outside help.
It was an amazing feat and it changed forever the concept of naval warfare. Germany had a total of twenty-one U-boats, but, because 1. Lewinsohn, pp. 103-4,222-24.
238 THE CREATURE FROM JEKYLL ISLAND
they constantly had to be repaired and serviced, the maximum number at sea was only seven at any one time. Yet, between 1914
and 1918, German submarines had sunk over 5,700 surface ships.
Three-hundred thousand tons of Allied shipping were sent to the bottom every week. One out of every four steamers leaving the British Isles never returned. In later years, British Foreign Secretary, Arthur Balfour, wrote: "At that time, it certainly looked as though we were going to lose the war."1 Robert Ferrell, in his
Across the sea came the dismay of the British—a dismay that carried a deepening note of disaster. There was a fear, and a well-grounded one, that England might be starved into abject surrender.... On April 27,1917, Ambassador Walter H. Page reported confidentially to the President that the food in the British Isles was not more than enough to feed the civil population for six weeks or two months.3
