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  • Infographic: JP Morgan Chase and the Loss in Perspective

    JP Morgan Chase’s $2 billion loss on a hedging strategy doesn’t mean that the bank is in crisis, and it certainly does not mean the government needs to step in. JP Morgan Chase is a $2.3 trillion bank with a net worth of $189 billion. While the bank’s loss represents a clear failure of management, they are accountable to the shareholders. The loss will be covered by the bank’s capital, just as it should be.  Neither the bank nor the financial system was endangered, and no government intervention or additional regulation is needed.

    Posted in Featured [slideshow_deploy]

    4 Responses to Infographic: JP Morgan Chase and the Loss in Perspective

    1. kverdeck says:

      Once again, Heritage, in your haste to defend the wealthy and their machinery, you miss the point.

      Sure, this was a small loss compared to the total value of JP Morgan Chase's holdings (and we'll leave aside for now the horrible idea of the 6 largest American banks controlling 70% of the nations banking assets, compared to 10% just 20 years ago). The issue here is that JP Morgan Chase is supposedly one of the best-behaved and most-restrained banks on Wall Street. Yet here we are hearing Mr. Dimon admitting that this loss was a mistake and the result of poor decision-making. Is the fact that they are able to easily absorb such a loss supposed to make us confident that it won't happen again, and again, and for larger stakes? You know, the exact same sort of behavior that led to the 2008 crash? We need to regulate these trades, we need to institute a transaction fee on every trade, and we need to take the advice of the Dallas Fed and break up these too-big-to-fail banks. Period.

      “Too big to fail–remember that term! … I’ll bet one day somebody’s going to look back at this and say, ‘How on earth could we have thought it made sense to allow the banking industry to concentrate through merger and acquisition to become bigger and bigger and bigger? How did we think that was gonna help this country?' I think we will in ten years time look back and say we should not have done that.” -Sen. Byron Dorgan, speaking prophetically in 1999 during deliberation of the Financial Services Modernization Act, which effectively repealed Glass-Steagall.

    2. NCTom says:

      Thank you for the infographic about J P Morgan Chase.
      The graphic might even be more outstanding if you included a square showing this current years first quarter net earnings, despite the losss.
      The mainstream media has everyone excited about the one time loss of $2 billion but says nothing about the $4.2 billion per day — YES per day — that the Obama Administration has lost every day since President Obama was inaugurated. Where are the demands for more regulation about that loss?

    3. Conservative Dan says:

      Or, maybe the market will determine that Chase isn't the golden investment it once was, and cut back on the capital it attracts. The free market will do a wonderful job of determining winners and losers.

    4. O2Bme says:

      Isn't it odd how we expect perfectcion in everyone and thing except ourselves? A doctor makes a mistake, sue him. If the bank makes a mistake tack on a new regulation. Of course the government thinks it never makes a mistake.

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