Category Archives: Uncategorized

Judith Mione (Left) Receives 1997 NOW “Woman of Courage Award.” Pam Martens, Editor of Wall Street On Parade, at Podium. March 27, 2013 The second annual event honoring Judy Mione, Wall Street veteran and activist for women’s equality in the male dominated field of securities trading, will be hosted by her daughter, Lynn Mione, on Thursday, April 18 in Merrick, Long Island, New York.  Judy Mione, who died in April 2011 following a long battle with cancer, was a lead plaintiff in the high profile Federal lawsuit against the New York Stock Exchange, National Association of Securities Dealers and the retail brokerage firm, Smith Barney. The suit, filed on May 20, 1996, dragged on for years including an appeal to the 2nd Circuit. The case forced out of the shadows Wall Street’s private justice system known as mandatory arbitration and its pivotal role in keeping Wall Street’s misdeeds hidden from public view … Continue reading →

By Pam Martens: March 26, 2013 The only entity less deserving of an Investor Relations award is the magazine that just gave one to JPMorgan’s Chairman and CEO, Jamie Dimon, last Thursday evening. Six days before the awards event hosted by IR Magazine (that stands for Investor Relations Magazine but could also stand for Insane Rationale Magazine) which went unattended by Dimon (likely out of fear he might trip over the people rolling on the floor at his award) the U.S. Senate Permanent Subcommittee on Investigations released a 307 page report and 98 exhibits proving beyond a shadow of a doubt that Dimon and his CFO at the time, Douglas Braunstein, either lied through their teeth to investors and investment analysts or were in the dark about what was going on within their own company when the Chief Investment Office churned $6.2 billion of bank deposits into pocket change. At … Continue reading →

By Pam Martens: March 25, 2013  During the Great Depression, the President of the United States, Franklin D. Roosevelt, was rapidly creating programs to address joblessness, poverty and the plight of the homeless. The First Lady, Eleanor Roosevelt, traveled tens of thousands of miles around the country, year after year, to check on those programs and report back to the public in a syndicated column she wrote six days a week titled “My Day.”  In the Great Recession, with 46.2 million Americans living in poverty, including one in every five children according to the U.S. Census Bureau, President Obama is spending his weekends in the Middle East or at a millionaire’s golf club while First Lady Michelle Obama adorns the current issue of Vogue wearing designer clothes costing more than it would take to feed a family of four for a year. This comes on the heels of the First … Continue reading →

By Pam Martens: March 22, 2013  One year ago this week, Ina Drew, head of the Chief Investment Office at JPMorgan which oversaw the synthetic credit derivatives portfolio that eventually blew up $6.2 billion of depositors’ money, told her traders “phones down,” signaling that she was halting all trading in those instruments. What Drew should have much earlier told her traders was: “unplug algorithms; plug in brains.”  Despite a multitude of formulas for measuring risk, multiple layers of oversight management, 28 members of a risk management team with titles like Managing Director, Executive Director, and Vice President, it somehow didn’t occur to any of these folks that the number one criteria for a trading investment is that you need to be able to get out of it.  London Whale was the nickname given to the JPMorgan trader, Bruno Iksil, as a result of the outsized bets he was making on … Continue reading →

By Pam Martens: March 21, 2013 Despite all the corporate media headlines that Mary Jo White would sail through her confirmation vote before the Senate Banking Committee on Tuesday, what actually happened stands in stark contrast to the prognostications. White was not approved for a full four-year term at the SEC. She was confirmed simply to finish out the remaining 14-month term of former SEC Chair Mary Schapiro’s term. President Obama sent the following nomination language to the Senate: “Mary Jo White, of New York, to be a Member of the Securities and Exchange Commission for the remainder of the term expiring June 5, 2014, vice Mary L. Schapiro, resigned. Mary Jo White, of New York, to be a Member of the Securities and Exchange Commission for a term expiring June 5, 2019.” But when the Senate Banking Committee met in Executive Session on Tuesday, March 19, 2013, there was no … Continue reading →

By Pam Martens: March 20, 2013  Last Friday, Senator Carl Levin told the Senate’s Permanent Subcommittee on Investigations that JPMorgan “piled on risk, hid losses, disregarded risk limits, manipulated risk models, dodged oversight, and misinformed the public.” And here’s the punch line: that’s not even the worst of what JPMorgan did.  Each of the charges leveled by Levin occurred on a regular basis over the past decade at the largest Wall Street investment banks. What has elevated JPMorgan to the top of the Wall Street dung heap is that the long laundry list of violations cited by Levin occurred in the commercial bank, not the investment bank. JPMorgan was gambling with the insured deposits of its customers – not its own capital. Thus far, it has acknowledged $6.2 billion in trading losses using other people’s money.  Both Senator Levin, who chairs the Senate Subcommittee, and Senator John McCain, ranking minority … Continue reading →

By Pam Martens: March 19, 2013 Gambling on high-risk synthetic credit derivatives is not the only area of interest at JPMorgan’s  Chief Investment Office (CIO) – the division that has thus far admitted to losing $6.2 billion in the London Whale debacle. According to Exhibit 81 released by the U.S. Senate’s Permanent Subcommittee on Investigations, Ina Drew, the head of the CIO, was also overseeing the investment of funds in the firm’s Bank Owned Life Insurance (BOLI) and Corporate Owned Life Insurance (COLI) plans – a scheme enshrined by the U.S. Congress in 2006 that allows too-big-to-fail banks as well as many other corporations to reap huge tax benefits by taking out life insurance policies on workers – even low wage workers – and naming the corporation the beneficiary of the death benefit. According to the exhibit, Drew was tasked with “Maximization of tax-advantaged investments of life insurance premiums” for … Continue reading →

By Pam Martens: March 18, 2013  The 307-page report the Senate released last Thursday on JPMorgan’s cowboy culture was deeply unsettling; the testimony under oath at the related Senate hearing on Friday was equally shocking with eyewitness accounts confirming that CEO Jamie Dimon ordered the withholding of  financial data to a regulator while both he and the Chief Financial Officer at the time, Douglas Braunstein, presented an Alice in Wonderland version of facts to the public in April 2012.  But it now appears that the worst of this story may be so unsettling to the markets and the public perception of Wall Street that it must be censored from public viewing. Throughout the Senate Permanent Subcommittee on Investigation’s 98 exhibits of emails and internal memos on the wild trading schemes at JPMorgan, the word “Redacted” appears.  In a high number of the areas where the material is censored, it concerns … Continue reading →

By Pam Martens: March 15, 2013  Much of the investing public, and I would venture many members of the research team at the Senate’s Permanent Subcommittee on Investigations that compiled the 307 page report on JPMorgan’s $6.2 billion in losses from the London Whale trade, are unaware that the company’s Chairman and CEO, Jamie Dimon, learned at the knee of the mastermind of too-big-to-fail – former Citigroup Chairman and CEO, Sandy Weill. From 1982 to 1998, Dimon was Weill’s first lieutenant, rising to the rank of President of Citigroup.  Carl Levin, Chairman of the Subcommittee, released the stunning investigative report yesterday and, throughout, the level of arrogance toward regulators, the dishonesty and dissembling on earnings calls, the hiding of losses, and the specter of the imperial CEO conjured up images of the downfall of Citigroup and Weill’s role in creating the culture than burned down the house. It felt, alarmingly, like … Continue reading →

By Pam Martens: March 14, 2013 When Wall Street wants to sell junk bonds to the public – those corporate bonds trading below an investment grade rating – a BBB rating by Standard and Poor’s or Baa by Moody’s – it simply puts lipstick on a pig by renaming the bond fund a “High Yield” fund. Since February, Senator Chuck Schumer (D-NY) has been providing the same service to the U.S. Senate with his slobbering introductions of the nominees to head the U.S. Treasury and Securities and Exchange Commission without noting any of the high risks to installing these deeply conflicted individuals. Schumer’s most recent spectacle came this past Tuesday when he grinned and fawned through his introduction of Mary Jo White at her confirmation hearing before the Senate Banking Committee. Schumer felt it was relevant for the U.S. public to know that the future watchdog to oversee one of … Continue reading →