By Pam Martens and Russ Martens: April 19, 2023 When JPMorgan Chase, Bank of America, Citigroup and Wells Fargo announced on March 16 that they were plunking $5 billion each of their corporate funds as uninsured deposits into the sinking First Republic Bank, they tied their corporate brand and their own bank’s image of safety and soundness to that of a teetering lender. Here’s what happened in short order thereafter: First Republic Bank’s stock closed on Thursday, March 16, the date of the announcement of the big infusion of money during market hours, at $34.27. On Friday, March 17, First Republic’s stock closed at $23.03. On Monday, March 20, the stock closed at $12.18. What the mega banks had hoped would be a vote of confidence in First Republic Bank was viewed by the composite wisdom of the markets as an act of desperation and the market savaged the stock price … Continue reading →

By Pam Martens and Russ Martens: April 18, 2023 Apple, maker of the iPhone and one of the top brands in the world, has decided to get deeper in bed with Goldman Sachs, a Wall Street trading house with more than 100 years of ignominious history. Goldman Sachs was infamously branded as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money” by Matt Taibbi in the pages of Rolling Stone. Of all things to offer through Goldman Sachs, Apple thinks it’s a swell idea to offer a high-yielding, FDIC-insured savings account – that is ultimately backstopped by the U.S. taxpayer if Goldman Sachs blows up – which it came close to doing in 2008. Apple’s credit card is already offered through Goldman Sachs. In an SEC filing on February 24, Goldman Sachs acknowledged that its credit card division is … Continue reading →

By Pam Martens and Russ Martens: April 17, 2023 On April 11, Wall Street On Parade ran this headline: Fed Report: Largest 25 U.S. Banks Have Shed $700 Billion in Deposits Over Past Year. Using deposit data directly from the Federal Reserve’s weekly H.8 report, we documented that contrary to the misleading reporting in the mainstream business press, it wasn’t the regional banks that were losing the bulk of deposits in the U.S., with the biggest banks the beneficiaries, it was actually the biggest banks that were dramatically shedding deposits. We explained as follows: “The reality is that the 25 largest domestically-chartered commercial banks in the U.S. have been bleeding deposits for most of the past 12 months, shedding more than $700 billion in deposits between April 13, 2022 and March 29, 2023. To put that in even sharper focus, all U.S. domestically-chartered commercial banks have lost a total of $970 billion during … Continue reading →

By Pam Martens and Russ Martens: April 13, 2023 Jamie Dimon, the Chairman and CEO of JPMorgan Chase, is desperately attempting to redirect the media’s focus to anything other than two federal lawsuits that name his bank as a knowing facilitator and cash conduit for Jeffrey Epstein’s child sex trafficking ring. One lawsuit has been filed by the government of the U.S. Virgin Islands where Epstein owned an island-compound and air-lifted young girls in and out. The other lawsuit has been filed by an alleged underage victim of Epstein’s, Jane Doe 1. Dimon’s high-powered p.r. machine has been churning out headlines on his role as “rescuer” of the teetering bank, First Republic, (never mind that there are few signs that the bank has actually been rescued). And one would think that Dimon has written a new Magna Carta for all the press attention going to his unremarkable annual letter to shareholders. … Continue reading →

By Pam Martens and Russ Martens: April 12, 2023 Four of the eleven big banks that announced on March 16 that they were going to dump a combined $30 billion of their own money as uninsured deposits into the plunging coffers of First Republic Bank were also the underwriters of $3.6 billion in preferred stock for First Republic Bank. Units of JPMorgan Chase, Bank of America, Morgan Stanley and Wells Fargo were underwriters of the majority of the preferred stock outstanding at First Republic Bank. UBS, which did not contribute to the $30 billion deposit infusion, was also one of the primary underwriters. UBS was otherwise occupied last month by having a gun put to its head by the Swiss government to “rescue” the tanking Credit Suisse. The Swiss government also denied shareholders on both sides of the deal the ability to vote on the matter. All of First Republic’s outstanding … Continue reading →

By Pam Martens and Russ Martens: April 11, 2023 To read the headlines in the major business press, one would think that since the upheaval began in the U.S. banking system, the largest U.S. commercial banks have been the beneficiaries in terms of deposit inflows. For example, on March 13 the Financial Times ran this headline: “Large US banks inundated with new depositors as smaller lenders face turmoil.” The subhead was even more questionable, reading: “Failure of Silicon Valley Bank prompts flight to likes of JPMorgan and Citi.” (JPMorgan Chase has been charged with five felony counts by the U.S. Department of Justice over the past nine years while Citigroup’s stock has been a basket case since the financial collapse in 2008. Citi did a 1-for-10 reverse stock split in 2011 to window dress its stock price.) See Citigroup stock price chart below. On March 25, CNBC ran a similar article … Continue reading →

By Pam Martens and Russ Martens: April 10, 2023 Jamie Dimon, the Chairman and CEO of JPMorgan Chase, has cranked up his public relations machine since March 16 to promote the narrative that he came to the “rescue” of the plunging regional lender, First Republic Bank. The so-called “rescue” consisted of 11 banks, including JPMorgan Chase, dumping a total of $30 billion in “uninsured” deposits into First Republic. But one of the bank’s key problems was that it already had too many uninsured deposits. (This was like seeing a house on fire and throwing 11 expensive martinis at it.) According to First Republic’s regulatory filings, as of December 31, 2022, it had total deposits of $176.25 billion, of which $119.47 billion (or 68 percent) were uninsured. The Federal Deposit Insurance Corporation (FDIC) caps federal deposit insurance at $250,000 per depositor, per bank. But banks such as First Republic, that cater … Continue reading →

By Pam Martens and Russ Martens: April 5, 2023 Millions of Americans are beginning to ask themselves this question: Is the Federal Reserve (the “Fed”) a competent central bank or a terminally compromised regulator that simply does the bidding of Wall Street’s mega banks to the peril of average Americans and the U.S. economy? Millions of other Americans have already made up their minds on this point. These persistent doubts about an institution with an $8.8 trillion balance sheet – that is backstopped by the U.S. taxpayer – is very bad for confidence in the U.S. banking system, especially when the Fed pivots from one banking bailout to the next. (What was the size of the Fed’s balance sheet prior to its serial bailouts? On December 26, 2007, the Fed’s balance sheet stood at $929 billion. It has soared by 847 percent in just over 15 years of serial bailouts.) Let’s … Continue reading →

By Pam Martens and Russ Martens: April 4, 2023 ~ The New York Times has been able to fly below the radar in terms of its insufferable ability to muck up the financial system of the United States and then canonize its aiders and abettors with puff pieces. It was none other than the New York Times that repeatedly used its editorial page to advocate for the repeal of the Glass-Steagall Act, which had protected the U.S. financial system from crisis for 66 years until its repeal under the Wall Street friendly Bill Clinton administration in 1999. It took only nine years after its repeal for the U.S. financial system to crash in 2008, requiring the largest public bailout in U.S. history. We’re now in banking crisis and bailout 3.0. The 1933 Glass-Steagall Act was passed by Congress at the height of the Wall Street collapse that began with the 1929 … Continue reading →

By Pam Martens and Russ Martens: April 3, 2023 ~ According to the Federal Deposit Insurance Corporation (FDIC), there were 4,706 federally-insured banks and savings associations in the U.S. as of December 31, 2022. Of those, according to the quarterly report released last Friday from the Office of the Comptroller of the Currency (OCC), a little less than one-quarter found a reason to engage in derivative trading activities. As of December 31, 2022, just 1,139 FDIC-insured commercial banks and savings associations reported trading of derivatives in the fourth quarter of 2022, according to the OCC. Ostensibly, instead of running a derivatives casino, the other three-quarters of taxpayer-subsidized banks were doing what taxpayers want federally-insured banks to do: make business loans; provide affordable mortgage loans to homebuyers; provide checking accounts devoid of hacking, identity theft and predatory overdraft fees; and not blow up the bank by getting in bed with derivatives, crypto … Continue reading →