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JPMorgan Chase

An American banking institution

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Swim with the Sharks

  • May 21, 2012
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Before I begin this review, let's state it for record that I don't own any shares in JP Morgan, have no business interest in it, nor do I do any banking transactions with the commercial institution. I do have a cousin who works in it!
So, why am I interested in it? Well, because of its recent week trading loss of US$2 billion!
$2 billion is not a small sum to anyone, not even Mark Zuckerberg; even if this is one of the biggest financial institutions in the world. Not to mention this loss is chalked up by a single department, probably by less than a handful of people too! Imagine for a sec, how long it would take to earn a profit of $2 billion or even revenue!
Facebook was listed last friday on Nasdaq. It was tauted as an incredible IPO which makes Mark Zuckerberg a $20 billion man! Now, everyone in the world know Mark Zuckerberg and Facebook. It's a company with lots of talents but not the necessary earnings to warrant its listing share price of some US$38. That's something to discuss later. It's now trading around $33!!!

For now though, Mark Zuckerberg made less than $2 billion a year. Even with some 800+ million friends and after some 9 years of hard work, he has a networth of US$20 billion as of last Friday.
Let's give it some perspective, shall we?
Mark Zuckerberg = $20 billion. 
JP Morgan trading loss in a week = $2 billion and adding by the minutes as this review is being penned. Dimon is in the rough! He claimed it's a stupid mistake and an oversight (his, for sure! and regulators, etc...).Those are my words. You get the gist of it. The reporter at Huff Post Business reported it as "risky and legally questionable trading" (Richard (RJ) Eskow in JP Morgan Chase: Break up the big banks now. Here's How). 
Now, this Memorial Monday, it's reported in Huffington Post as well as London Evening Standard that the losses will escalate to some $7 billion! JPMorgan's net income in 2011 is around US$18.9 billion. That took some 260,000 employees around the world to make it in a year! Some jokers lost a tenth of that (possibly more) in a week?! Stunning?!!! 

If you're not, then you should be. JPMorgan Chase was unscathed when other financial institutions were seeking out bailouts during the 2008 financial crisis that rocked the entire world and most of us are still left with feeling the aftershocks. A friend of mine has ended his life partly because of the reckless activities of these so called bankers. Mind you, they are bankers, not loan sharks. Or, are they???
Regulators should seriously look into these organizations. Granted, the shareholders are the ones having the right to question the management. And, what business is it for us individuals? Well, I'd be thinking a lot more of it if I were banking with these banks. Also, beware, retail investors, you're swimming with the sharks!!! As for taxpayers, good luck to you (again!) if these institutions should pose systemic risks to the financial system globally again! As if Greece isn't problematic enough!!! *sigh...* 

It's not just Dimon in the rough! The sea is rough!!!

(A Lunch Featured Review)
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May 21, 2012
I disagree. Regulations are not the issue here. Risk is the nature of the business, and instead of looking at JP's loss it might bode well to look at their corporate profits. http://www.guardian.co.uk/business/2012/apr/...venues-rise-legal-costs
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Sharrie ()
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I'm a traveler at heart & have been nicknamed Travel Queen by friends & colleagues alike. Traveling has been my life passion for the last decade or so. As we enter a new decade, I'm excited … more
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JPMorgan Chase & Co. (NYSEJPM) is an American multinational banking corporation of securitiesinvestments and retail. It is the largest bank in the United States by assets and market capitalization.[3] It is a major provider offinancial services, with assets of $2 trillion and according to Forbes magazine is the world's largest public company based on a composite ranking.[4] The hedge fund unit of JPMorgan Chase is one of the largest hedge funds in the United States.[5] It was formed in 2000, when Chase Manhattan Corporation merged with J.P. Morgan & Co.[6]

The J.P. Morgan brand is used by the investment banking as well as the asset managementprivate bankingprivate wealth management and treasury & securities services divisions. Fiduciary activity within private banking and private wealth management is done under the aegis of JPMorgan Chase Bank, N.A.—the actual trustee. The Chase brand is used for credit card services in the United States and Canada, the bank's retail banking activities in the United States, and commercial banking. The corporate headquarters are in 270 Park AvenueMidtownManhattan, New York City, New York, and the retail andcommercial bank is headquartered in Chase TowerChicago LoopChicago, ...

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