integrations and
consolidations that the investment banker came into his own as the
keystone in the modern industrial arch.

5. _The Investment Banker_

The investment banker is the directing and coordinating force in the
modern business world. The necessities of factory production demanding
great outlays of capital; the immense financial requirements of
corporations; the consolidation of business ventures on a huge scale;
the broadened use of corporate securities as investments--all brought
the investment banker into the foreground.

Before the Spanish War, the investment banker financed the trusts. After
the war he was entrusted with the vast surpluses which the concentration
of business control had placed in a few hands. Business consolidation
had given the banker position. The control of the surplus brought him
power. Henceforth, all who wished access to the world of great
industrial and commercial affairs must knock at his door.

This concentration of economic control in the hands of a relatively
small number of investment bankers has been referred to frequently as
the "Money Trust."

Investment banking monopoly, or as it is sometimes called, the "Money
Trust" was examined in detail by the Pujo Committee of the House of
Representatives, which presented a summary of its report on February 28,
1913. The committee placed, at the center of its diagram of financial
power, J. P. Morgan & Co., the National City Bank, the First National
Bank, the Guaranty Trust Co., and the Bankers Trust Co., all of New
York. The report refers to Lee, Higginson & Co., of Boston and New
York; to Kidder, Peabody & Co., of Boston and New York, and to Kuhn,
Loeb & Co., of New York, together with the Morgan affiliations, as being
"the most active agents in forwarding and bringing about the
concentration of control of money and credit" (p. 56).

The methods by which this control was effected are classed by the
Committee under five heads:--

1. "Through consolidations of competitive or potentially competitive
banks and trust companies which consolidations in turn have recently
been brought under sympathetic management" (p. 56).

2. Through the purchase by the same interests of the stock of
competitive institutions.

3. Through interlocking directorates.

4. "Through the influence which the more powerful banking houses, banks,
and trust companies have secured in the management of insurance
companies, railroads, producing and tradin