Search Results for: Federal Reserve

By Pam Martens: January 17, 2024 ~ Anat Admati, Professor of Finance and Economics at Stanford Graduate School of Business, and German economist Martin Hellwig, have performed a public service to all Americans with their newly released, updated and expanded book The Bankers’ New Clothes: What’s Wrong with Banking and What to Do about It. It puts the interlocking web of corruption that is mistakenly referred to as the U.S. banking system into a pristinely documented and highly readable book. Let us first explain those men without pants on the book jacket. That provocative graphic comes from the storyline in the Hans Christian Andersen tale “The Emperor’s New Clothes.” Tailors offer to make the emperor magical clothes that will be visible only to smart people and invisible to the stupid and unfit. When the emperor’s ministers go to inspect the clothes, they see nothing, but they are fearful of being called … Continue reading →

By Pam Martens and Russ Martens: January 16, 2024 ~ Jamie Dimon is the Chairman and CEO of the largest federally-insured, taxpayer-backstopped bank in the United States, JPMorgan Chase. Through much of Dimon’s tenure, JPMorgan Chase has also been designated as the riskiest bank in the United States by its regulators. And despite its unprecedented criminal history, the U.S. Department of Justice keeps handing the bank deferred-prosecution agreements or non-prosecution agreements with the casualness of a carnival barker tossing out penny candy. Dimon’s Board of Directors is too compromised itself to reform the bank and fire Dimon. (See here, here and here.) So all that remains as a potential restraint on this criminally-inclined banking behemoth is the bank’s federal regulators. On July 27 of last year, the Federal Reserve, FDIC and Office of the Comptroller of the Currency (OCC) – JPMorgan Chase’s bank regulators — released a proposal to require higher capital levels … Continue reading →

By Pam Martens and Russ Martens: January 9, 2024 ~ Last September, speaking at a conference sponsored by the nonprofit watchdog, Better Markets, to examine if “too big to fail” banks had materially changed in the fifteen years since the 2008 financial collapse, Anat Admati, Professor of Finance and Economics at Stanford Graduate School of Business, offered her assessment of the U.S. banking system: “Corruption has become the system.” Today, Admati’s celebrated 2013 book, The Bankers’ New Clothes: What’s Wrong with Banking and What to Do about It, co-authored with German economist Martin Hellwig, is being released in an expanded new edition. It is a must read for every American who is bold enough to remove their media tinted, rose-colored glasses and take a hard look at how the U.S. banking system got into the mess it’s in today. Although written by serious academics, the book provides a courageous, fascinating, and easily digestible … Continue reading →

By Pam Martens and Russ Martens: January 4, 2024 ~ William (Bill) Dudley served as President of the New York Fed from 2009 to 2018. (He was previously an executive at Goldman Sachs.) During Dudley’s tenure at the New York Fed, it secretly oversaw the largest and darkest bailout of Wall Street mega banks in global banking history. A Bloomberg News reporter, the late Mark Pittman, battled in court for years to get the details of those bailouts released to the public. Today, the former kingpin of darkness at the New York Fed, Bill Dudley, had the audacity to pen an opinion column for Bloomberg News, urging – wait for it – more transparency at the Fed. The ironic title of Dudley’s column is (paywall): “If Only We Knew the Problems Facing America’s Banks.” (We do. See Federal Agency Study Contradicts Fed Chair: Finds Banking System Is Ripe for Another Crisis and … Continue reading →

By Pam Martens and Russ Martens: December 28, 2023 ~ The year 2023 will go down in U.S. banking history as the year in which the fastest bank runs in U.S. history occurred, producing the second, third and fourth largest banking failures in U.S. history in the span of seven weeks.  Losses of more than $32 billion from these failed banks hit the Federal Deposit Insurance Fund (FDIC). Adding to the regulatory hubris, the largest and riskiest bank in the U.S., JPMorgan Chase, was allowed by its compromised regulators to become even riskier by gobbling up the failed First Republic Bank while JPMorgan Chase got an unexplained $50 billion 5-year loan from the FDIC at an undisclosed interest rate to sweeten its purchase of the failed bank. And, what good is a banking crisis if the Fed can’t pony up yet another bank bailout fund, this time with loans of up to … Continue reading →

By Pam Martens and Russ Martens: December 20, 2023 ~ Jerome Powell became the Chairman of the Federal Reserve on February 5, 2018 after being nominated by then President Donald Trump and passing his Senate confirmation. Powell was sworn in again on May 23, 2022 for a second term as Chair. His second term runs until May 15, 2026.  Unlike most Fed Chairs, Powell has no economics degree. He has a law degree from Georgetown University. For more background on Powell, see our May 18, 2020 article: The Fed’s Chair and Vice Chair Got Rich at Carlyle Group, a Private Equity Fund with a String of Bankruptcies and Job Losses. Powell’s tenure as Fed Chair has been mired by the biggest trading scandal in the Federal Reserve’s 110-year history. That scandal has yet to be resolved in a manner that meets the test of accountability. See our October report: After Two Years, … Continue reading →

By Pam Martens and Russ Martens: December 15, 2023 ~ A Wall Street cartel of lobbying groups has launched their fiercest anti-regulation battle with Congress since it was in the midst of writing the Dodd-Frank financial reform legislation of 2010. That legislation hoped to address the worst Wall Street abuses and corruption that brought on the crash of 2008 – the most devastating financial meltdown since 1929 and the Great Depression. (See our report: Meet the Banking Cartel that Is Planting the Seeds for the Next Banking Panic and Bailout.) One tentacle of the cartel is the Financial Services Forum, whose total membership consists of the CEOs of the eight Wall Street mega banks: Jamie Dimon of JPMorgan Chase; Brian Moynihan of Bank of America; Charles Scharf of Wells Fargo; Jane Fraser of Citigroup; David Solomon, Goldman Sachs; James Gorman, Morgan Stanley; Robin Vince, Bank of New York Mellon; and Ronald … Continue reading →

By Pam Martens and Russ Martens: December 14, 2023 ~ Quietly, on December 1, the New York Fed published the following statement on its website: “The Norinchukin Bank, New York Branch, has been added to the list of Standing Repo Facility Counterparties, effective December 1, 2023.” The Standing Repo Facility (SRF) is a permanent $500 billion bailout facility created by the Federal Reserve and operated by the New York Fed – the private regional Fed bank where multi-trillion dollar Wall Street bank bailouts have become a regular feature of its operations. Without any action from the U.S. legislative branch (otherwise known as Congress), the Fed has unilaterally decided to become lender of last resort to Wall Street trading houses (whom the Fed prefers to call its “primary dealers”) and deposit-taking banks, including the uninsured New York branches of foreign banks like Norinchukin Bank. If you have never heard of Norinchukin Bank, … Continue reading →

By Pam Martens and Russ Martens: December 12, 2023 ~ There is a battle raging between the Wall Street mega banks and their federal banking regulators. The regulators want the mega banks to hold more capital against their high risk trading positions to prevent a replay of the bailouts in 2008 and repo bailouts in the fall of 2019. The mega banks have launched a deceptive ad campaign and public relations battle to thwart that from happening. The federal regulators’ efforts to raise capital are being undermined by Fed Chairman Jay Powell’s perpetual testimony to Congress that the U.S. banking system is safe and sound and adequately capitalized. Thus far, no member of Congress has thought to question Fed Chair Powell during public hearings as to why the Fed needs a new permanent bailout facility of $500 billion, on top of its century-old Discount Window, if the banking system is adequately … Continue reading →

By Pam Martens and Russ Martens: December 11, 2023 ~ During the Sunday, December 10 news program on CNN, “State of the Union with Jake Tapper and Dana Bash,” a deceptive, scare-mongering TV commercial popped up, warning that federal banking regulators’ proposed plan to require the mega banks on Wall Street to hold more capital against their riskiest trading activities “will increase the cost of mortgages and car payments” and “hurt small businesses, making it harder for them to access credit, meet payroll and run their operations.” The ad featured images of a farmer on his tractor, an auto mechanic, a worried small business owner, and other emotion-packed images. Wall Street On Parade has been warning our readers for weeks about this deceptive campaign by the Wall Street mega banks, so we jumped to our feet to get closer to the TV screen and read the fine print to see who … Continue reading →