Andrew Carnegie was a Scottish-American industrialist who significantly transformed the American steel industry in the late 19th century. At his peak, his inflation-adjusted net worth reached approximately $310 billion, ranking him as the fourth richest person in history.
Renowned for his philanthropy, Carnegie donated over 90% of his fortune to foundations, charities, and educational institutions, leaving a lasting impact on society before his death.
Andrew Carnegie expanded the American steel industry in the 19th century by pioneering mass production techniques and implementing vertical integration in steel production.
At his peak, he controlled the largest integrated iron and steel operations ever owned by an individual in the U.S.
One of his key innovations was the adoption and adaptation of the Bessemer process, which allowed for the cheap and efficient mass production of steel, revolutionizing the industry and contributing to America’s industrial growth.
Andrew Carnegie (Credit: Pinterest)
In 1909, Andrew Carnegie sold his company, Carnegie Steel, to J.P. Morgan for $303 million, with Carnegie’s share amounting to $225 million—equivalent to about $7 billion today.
The total value of the sale increased to $480 million due to interest on the bonds used for the transaction.
Compared to the U.S. GDP at that time, Carnegie’s wealth translates to hundreds of billions today, with estimates of his current equivalent net worth ranging from $300 billion to $310 billion.
The U.S. Steel Corporation, formed after Carnegie sold his company, became the first U.S. company to reach a market capitalization of over $1 billion.
Following the sale, Carnegie dedicated the rest of his life to philanthropy, focusing on local libraries, world peace, education, and scientific research.
By the time of his death, he had donated over $350 million of his fortune, and his remaining $30 million was allocated to various foundations, charities, and pensions for workers.
As Andrew Carnegie approached retirement in the early 1900s, Charles M. Schwab, a Carnegie Steel executive, began secretly negotiating to sell the company to financier J.P. Morgan.
Schwab is not related to the contemporary Charles Schwab financier, but J.P. Morgan’s banking institution is indeed a direct descendant of the same financier, establishing a significant legacy in American finance.
The deal for Carnegie Steel was finalized at $303 million, with Carnegie receiving over $225 million. The newly formed United States Steel Corporation was managed by Schwab. Since J.P. Morgan lacked the cash for the payment, he used bonds instead, which offered 5% annual interest over 50 years.
These bonds were stored in a specially built vault at a bank in Hoboken, New Jersey. Over time, the total cost of the acquisition, including interest, grew to $480 million.
One of Andrew Carnegie’s first actions after selling Carnegie Steel was to transfer $5 million to fully fund a pension for his steel workers, demonstrating his commitment to their financial security and well-being.
Jerome Powell, born in 1953, is the 16th chair of the Federal Reserve. He earned a degree in politics from Princeton University in 1975 and received his Juris Doctor from Georgetown University Law Center in 1979.
Powell began his career in investment banking, becoming a partner at the Carlyle Group until 2005. He then founded Severn Capital Partners, focusing on litigation finance and other investment areas.
His political involvement started in 1992 when he worked under the Secretary of the Treasury for domestic finance during the George H.W. Bush administration.
Jerome Powell (Credit: X)
In 2012, Powell was appointed to the Federal Reserve Board of Governors and became Fed Chairman in 2018, a position he was later renominated for by President Joe Biden.
According to a 2017 Bloomberg report, Jerome Powell’s net worth could be as high as $112 million, based on his financial disclosures. Previous estimates had placed his net worth at around $55 million, which would still make him the richest Fed chair in history.
A source noted that Powell is the wealthiest Fed chair since 1948, a fact that reflects his Ivy League education, extensive background in investment banking, and experience as a founder of a private equity firm.
Jerome Powell began working at the Carlyle Group, a leading private equity firm, in the late 1990s, but details about his earnings during his tenure as a partner remain undisclosed.
As of 2024, Carlyle Group has $426 billion in assets under management, solidifying its status as a major player in the market. Notably, since Powell became Fed chairman, Carlyle’s stock price has more than doubled.
Jerome Powell (Credit: Pinterest)
After leaving Carlyle in 2005, Jerome Powell founded Severn Capital Partners, a private investment firm.
Severn Capital Partners specializes in various financial disciplines, including litigation finance, litigation management, and product rationalization, among other areas.
“Severn Partners is a different kind of Private Equity partner. We take an active role in our investments. We seek to add value through hands-on participation, direction, and at times – full control. We believe that there is such a thing as “dumb money,” and we work hard to be more than just a financial partner,” the Severn Capital Partner team described their mission on their website.
With an estimated net worth of up to $112 million, Jerome Powell ranks among the wealthiest chairs of the Federal Reserve in U.S. history.
Although politically aligned as a Republican, he has gained the trust of Democratic President Joe Biden, highlighting his expertise in financial matters. In recent years, Powell has adeptly navigated the challenges of rising interest rates while combating inflation.
So far, he has successfully managed to control inflation without triggering an economic slowdown, a complex task that requires careful balancing.
