Search Results for: JPMorgan

By Pam Martens and Russ Martens: December 27, 2017 During Fed Chair Janet Yellen’s press conference on December 13, she had this to say about financial stability on Wall Street: “And I think when we look at other indicators of financial stability risks, there’s nothing flashing red there or possibly even orange. We have a much more resilient, stronger banking system, and we’re not seeing some worrisome buildup in leverage or credit growth at excessive levels.” Where does Fed Chair Janet Yellen get her information on financial stability risks to the U.S. financial system? A key source for that information is the Office of Financial Research (OFR), a Federal agency created under the Dodd-Frank financial reform legislation of 2010 to keep key government regulators like the Federal Reserve informed on mounting risks. On December 5, the OFR released its Annual Report for 2017. It was not nearly as sanguine as … Continue reading →

By Pam Martens and Russ Martens: December 20, 2017 Like that box of macaroni in your kitchen cupboard, the U.S. stock market has become a lot more expensive but has actually shrunk in terms of quantity. In 1975, U.S. domestic companies that traded on U.S. exchanges totaled 4,819. Forty years later, the market has shrunk to less than 4,000, despite a tripling in GDP. If you take a shorter time span of  20 years, which included the dot.com craze of listing companies known to Wall Street insiders as “crap” and “dogs,” the numbers are worse. In September of last year, Jim Clifton, the Chairman and CEO of Gallup, the polling company, reported the following: “The number of publicly listed companies trading on U.S. exchanges has been cut almost in half in the past 20 years — from about 7,300 to 3,700. Because firms can’t grow organically — that is, build more business … Continue reading →

By Pam Martens and Russ Martens: December 18, 2017 On Saturday, the news broke that Kory Langhofer, counsel to Donald Trump’s transition team known as Trump for America, Inc. (TFA), had sent a 7-page letter to House and Senate Committees stating that Special Counsel Robert Mueller’s office had improperly received “tens of thousands of emails” from the General Services Administration (GSA), a Federal agency, that had been sent or received by members of Trump’s transition team. Both the GSA and Mueller’s spokesmen denied that there had been anything improper about the turnover of the emails. Peter Carr, a spokesman for Mueller, said that “When we have obtained emails in the course of our ongoing criminal investigation, we have secured either the account owner’s consent or appropriate criminal process.” Lenny Loewentritt, a veteran lawyer for the GSA told Buzzfeed that transition team members were told by the GSA that materials “would … Continue reading →

By Pam Martens and Russ Martens: December 12, 2017 The Financial Industry Regulatory Authority (FINRA), Wall Street’s self-regulator with a long history of conflicts of interest, has released a summary of its findings from the examinations it conducts at the nation’s brokerage firms. As is typical of FINRA, the document released to the public is extremely light on details. (Almost half of FINRA’s Board comes from inside the industry, with current representation from JPMorgan Chase, Merrill Lynch, Citadel and Fidelity, to name just a few of the insiders.) One area of the report did stand out, however. FINRA has expressed concerns about the fairness of the price you’re getting on the stock or bond trade you’re placing with your broker. In Wall Street parlance, this is known as “Best Execution.” The report explains: “Best execution is a significant investor protection requirement that essentially obligates a broker dealer to exercise reasonable … Continue reading →

By Pam Martens and Russ Martens: December 11, 2017  In 2012, the Sentencing Project released a study that estimated that 5.85 million people would be ineligible to vote in the U.S. Presidential election that year because they had been convicted of a felony. In 22 states, felons lose their voting rights during incarceration, and for a set period of time thereafter. Usually, this includes while the individual is on parole and/or probation. Eleven states in the U.S. are more harsh. They deny voting rights to felons who have served their time in prison and have successfully completed parole and probation. If you’re a citizen of the United States and commit a felony, it’s a big deal. If you’re a Wall Street bank and commit a felony, it’s business as usual. In January 2014, JPMorgan Chase was charged with two felony counts by the U.S. Department of Justice for its involvement … Continue reading →

By Pam Martens and Russ Martens: December 8, 2017 Some of the same warning signs that emerged before the 1929 to 1933 market crash, the tech mania crash of 2000, and the epic Wall Street meltdown of 2008 are flashing red. If you have significant amounts of your 401(k) invested in equity mutual funds (that is, those invested in stocks), it’s time to take an objective appraisal of today’s market versus historic benchmarks. This is also a good time to remember that markets have lost as much as 50 percent of their value from peak to trough in the last 20 years. If that’s more pain than you’re prepared to suffer, it may be time to trim back your exposure. We’ll get to the specifics on today’s market shortly, but first some necessary background. In the market crash of 1929 to 1933, the stock market lost 90 percent of its … Continue reading →

By Pam Martens and Russ Martens: December 4, 2017 On November 8, the Securities and Exchange Commission (SEC) Chairman, Jay Clayton, delivered a speech at the Practising Law Institute’s 49th Annual Institute on Securities Regulation. His focus was transparency on Wall Street and he had this nugget of wisdom to share with the audience: “Looking back at enforcement actions, a common theme emerges – where opacity exists, bad behavior tends to follow. As Joseph Pulitzer said: ‘There is not a crime, there is not a dodge, there is not a trick, there is not a swindle, there is not a vice which does not live by secrecy.’ The remainder of my remarks will concentrate on topics that have proven over time to be fertile ground for fraud on investors. The SEC may not yet have policy or rulemaking answers in these areas, but we are on the lookout for ways … Continue reading →

By Pam Martens and Russ Martens: November 29, 2017 “Populist” candidate for President, Donald Trump, railed against the “political establishment” and Wall Street elites who were “getting away with murder.” On October 26, 2016, just days before the Presidential election, Trump spoke at a rally in Charlotte, North Carolina and promised to uphold the plank in the Republican Party platform to break up the big banks by restoring the Glass-Steagall Act. He stated: “The policies of the Clintons brought us the financial recession — through lifting Glass-Steagall, pushing subprime lending, and blocking reforms to Fannie and Freddie. Two friendly names but they’re not so friendly. It’s time for a 21st century Glass-Steagall and, as part of that, a priority on helping African-American businesses get the credit they need.” Now, as the sitting President, the former populist candidate has become the embodiment of the political establishment he railed against. He has stacked his … Continue reading →

By Pam Martens and Russ Martens: November 27, 2017 Since its financial meltdown in 2008 and unprecedented bailout by the U.S. taxpayer, Citigroup (parent of Citibank) has been repeatedly charged by its Federal regulators with odious crimes against its pooled mortgage investors, credit card and banking customers, student loan borrowers, and for its foreclosure frauds. It has paid billions of dollars in fines for its past misdeeds while new charges pile up. In 2015, it became an admitted felon for participating in rigging foreign exchange markets. In short, Citigroup is a lawbreaking recidivist. If it were a mere human, it would be serving a long prison term. Instead, its fines for charges of egregious acts are getting smaller, not larger. Last Tuesday, the Consumer Financial Protection Bureau (CFPB), which typically has a good track record of holding the big Wall Street banks accountable for their misdeeds, imposed an unusually feeble … Continue reading →

By Pam Martens and Russ Martens: November 13, 2017  A man holding one of the most important and powerful jobs for keeping the U.S. banking system safe from another epic crash like that of 1929 and 2008 has tongues wagging over the bizarre speech he delivered at the Clearing House Annual Conference last Wednesday in New York. Keith Noreika is the acting head of the Office of the Comptroller of the Currency (OCC), the Federal agency responsible for supervising national banks and inspecting them for safety and soundness. What Noreika recommended last Wednesday, however, would make the U.S. banking system significantly more dangerous than it already is. Noreika thinks there is no good reason to prevent giant corporate conglomerates from owning insured depository banks that are backstopped by the U.S. taxpayer. He had this to say in his speech last week: “The narrative persists to keep commercial interests from owning or … Continue reading →