Search Results for: JPMorgan

By Pam Martens: July 20, 2012 Tomorrow will mark the second anniversary of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  It is appropriate that the public has learned recently through the Libor scandal that Wall Street is far from reformed and that no consumer in America is protected from the continued pillaging of Wall Street. One man who has done his very best to escape his rightful place among the cast of Wall Street enablers who provided the deregulatory foundation for a serial crime spree by Wall Street is Arthur Levitt, the longest serving Chairman of the Securities and Exchange Commission from 1993 to 2001. Levitt and his mighty crew of public relations handlers have pulled out all stops to rewrite history.  Levitt’s current page at the SEC’s web site contains this rollicking piece of fantasy: “Investor protection was Chairman Levitt’s top priority. Throughout his tenure at the … Continue reading →

By Pam Martens: July 18, 2012 With so much press attention going to the transatlantic finger pointing by Washington and London, it’s easy to lose sight of the depth of the Libor scandal and what it means to the pocketbooks of average workaday folks here in the U.S. and around the globe.  It’s also easy to overlook that we’re also talking about what the public has long suspected: that proprietary trading, where big banks and Wall Street firms trade for the house, is corrupt to its core.  Libor is an interest rate index that impacts the family budget in significant ways.  It controls  approximately $10 trillion in consumer loans around the globe, including adjustable rate mortgages, credit cards and student loans here in the U.S. According to emails obtained by prosecutors, in some cases prior to 2007, Libor was rigged higher, which would have caused higher interest rates on consumer loans tied to Libor.  … Continue reading →

By Pam Martens: July 13, 2012 In unusually swift fashion (unlike the long court action to obtain details of the secret trillions in loans the Fed lavished on domestic and foreign banks) the Federal Reserve Bank of New York today handed over emails and other documents showing that Barclays, the first firm to be charged in rigging the interest rate benchmark known as Libor, was using the New York Fed’s stately offices as a confessional.  In one email, an unnamed confessor from Barclays tells Fabiola Ravazzolo, a Senior Financial Economist at the New York Fed with a sexy British accent (sort of like that comforting voice on your car GPS) that, yes, he’s sinned. FR is Fabiola Ravazzolo;  the colon represents the Barclays employee. FR: And, and why do you think that there is this, this discrepancy? Is it because banks maybe they are not reporting what they should or is it um…  … Continue reading →

By Pam Martens: July 9, 2012 The big money to be made from cheating on Libor was from exchange traded interest rate contracts and over-the-counter interest rate swaps.  According to the Office of the Comptroller of the Currency, as of March 31, 2012, U.S. banks held $183.7 trillion in interest rate contracts.  Just four firms represent 93% of total derivative holdings: JPMorgan Chase, Citibank,  Bank of America and Goldman Sachs.   A criminal investigation by the Canadian Competition Bureau into the rigging of Libor has implicated JPMorgan Bank Canada, Citibank Canada, HSBC Bank Canada, Deutsche Bank AG, and the Royal Bank of Scotland N.V. (RBS).  UBS is cooperating with the probe and providing documents. The Bureau’s demand for production of documents at each of the banks suggest that their derivative traders used emails and instant messaging to communicate artificially high or low bids to the bank’s staff who were submitting rate … Continue reading →

By Pam Martens: July 1, 2012 Spencer Bachus is the Chairman of the powerful House Financial Services Committee. On June 19, 2012, Bachus issued a press release that carried his opening remarks for the hearing on JPMorgan’s $2 billion (and growing) losses.  The final sentence of that prepared text read as follows:  “Before closing, once again I want to re-emphasize the point that JPMorgan and its shareholders – not the bank’s clients, and more importantly, not the taxpayers – are the ones paying for the bank’s mistakes. This is how the system is supposed to work.”  This is how the system is supposed to work? Maybe for the Russian Mafia or in some dystopian universe where only descendants of the Koch brothers are permitted to live.  But here in America, those who have not yet had a Fox News lobotomy, believe this is exactly how the system is not meant to … Continue reading →

  By Pam Martens: June 22, 2012  Moody’s had barely published its ratings downgrades of the big banks on Wall Street before their public relations flaks hurled an avalanche of insults at Moody’s.  Citigroup was the most vitriolic of the pack, calling Moody’s “arbitrary,” “backward looking,” and “opaque.”  This from a company managed by a former hedge fund manager whose stock would be trading at $2.79 (intraday) had it not done a 1 for 10 reverse split and who previously hid tens of billions off its balance sheet in Structured Investment Vehicles (SIVs).  In fact, Citigroup wouldn’t even exist today had the taxpayer not bailed it out with $45 billion in TARP funds, over $300 billion in guarantees, and trillions in secret loans from the Fed. But Citi said in its press release: “In our view, investors and clients should make their own decisions and not rely on ratings — … Continue reading →

By Pam Martens: June 22, 2012  On June 25 and June 26, 1998, the Federal Reserve held hearings at the Federal Reserve Bank of New York on allowing Travelers Group, which owned an insurance firm (Travelers), investment bank (Salomon Brothers) and brokerage firm (Smith Barney) to merge with a bank holding FDIC insured deposits (Citicorp/Citibank). Despite solid testimony that this merger was illegal, the Fed approved the merger and Citigroup was born. Sandy Weill, head of Travelers, and Jamie Dimon, his first lieutenant (now Chairman and CEO of the risk-management-challenged JPMorgan Chase) were the brains behind the Travelers/Citicorp deal and made a fortune from it.  That merger forced all of Citigroup’s main competitors to do similar deals in order to compete, setting in motion today’s too big to fail financial chaos. Why didn’t the Fed listen to the testimony?  Why didn’t the Fed follow the law? Here’s a sampling of … Continue reading →