POST JP MORGAN: THE MARKETS ARE HOLDING BETTER THAN EXPECTED

Posted on May 12, 2012

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We found this late yesterday from CS Monitor: “Four years ago as the housing market collapsed, the investment bank Lehman Brothers failed, which resulted in a cascading economic crisis. Mr. Dickson says few people realized the importance of Lehman in funding corporate America. By contrast, he says, the JP Morgan trading losses are self-contained to a trading department.”

All of the frontpaging has been JP Morgan lost $2 Billion in reckless trading. MSNBC is drooling while waiting for news Sunday: “Major banks hoping to thwart calls for tighter banking restrictions were dealt a blow by news that JPMorgan Chase lost $2 billion in a trading blunder that proponents of new rules say more stringent regulation would curtail.”

It was 9 paragraphs into the story before we found: “The bank is well-positioned to sustain the loss. Before the news broke, analysts were estimating the company would earn more than $4 billion in the current quarter alone. At the end of last year, JPMorgan had more than $2 trillion worth of assets on its books, including $380 billion in cash.”

It was almost for show, the following paragraph read: “But the loss has already amplified calls for tighter regulation on risky banking, more than three years after a wave of losses from bad mortgage bets swamped the global financial system and brought about the worst recession since the 1930s.”

JP lost $2 Billion while earning $4 Billion, what’s in a bottom line? A company working with $380 Billion of cash assets, a few Billion is pennies on the dollar.

As far as the Lehman ‘crisis’, we are living without Lehman Bros.

Government has taken over automotive, energy, mortgages…, which is profitable? Who are they to tell us what to do with our money?


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