JPMorgan

What JPMorgan's Recently Released Internal Reports Unintentionally Say

Author: 
John Fullerton

After apologizing at Davos - but only to his shareholders - according to William Cohan on the Bloomberg View, the JPMorgan Chairman and CEO hastened to add about 2012, “We did have record profits. Life goes on.”

It is true; JPMorgan reported a strong financial performance in 2012, “London Whale” trading fiasco notwithstanding. I must admit that despite my 18 years inside the firm (when it had a meager $300 billion balance sheet), I struggle to comprehend $100 billion of revenues, and a $2.3 trillion balance sheet, with an “off-balance sheet” managed by a few handfuls of mostly male, mostly thirty something traders that is many orders of magnitude larger. Maybe I’m a dinosaur. Life goes on.

Not so fast.

Will Barclays' CEO Surprise Us?

Author: 
John Fullerton

Like Lloyd Blankfein with the Abacus fiasco, and Jamie Dimon with “the whale trade,” Barclays CEO Bob Diamond has an unparalleled opportunity to surprise us this week during his appearance before Parliament to explain the most recent financial scandal involving the systematic manipulation of LIBOR, the benchmark interbank lending rate upon which hundreds of trillions of dollars of financial transactions are priced, over several years. Will Diamond seize the opportunity missed by both Blankfein and Dimon to emerge as the first true financial statesman of the modern global banking crisis?

Is Jamie Dimon's Business First Class?

Author: 
John Fullerton

JPMorgan CEO Jamie Dimon will today, once again, stand before the authors of Dodd-Frank and attempt to make the case for why a $2 billion trading loss was a stupid mistake, not a willful breach of at least the intent of the law. Our representatives who wrote the law should hold him to the standards set by JPMorgan’s own Code of Conduct: following the spirit and intent, not just the letter, of the law.

When Mr. Dimon’s predecessor J.P. Morgan Jr. was called before the Senate in 1933, he spoke humbly of a banker as a member of a long-standing profession for which there had grown a code of ethics and customs, “on the observance of which depend his reputation, his fortune, and his usefulness to the community in which he works.”

10 Questions JPMorgan’s Board of Directors Should be Asking

Author: 
John Fullerton

Much has been written about the trading—not hedging—debacle at JPMorgan.  Jamie Dimon’s mea culpa is intended to head off deeper questions. No cover-up on his watch—get out in front, be direct, deal with it, move on.  Right?  Not so fast.

Financial Statesmanship for a New Economy

Author: 
John Fullerton

Reactions to departing Goldman derivatives salesman Greg Smith’s “Why I am Leaving Goldman Sachs,” which appeared as an op-ed in the New York Times last week, have ranged from the hyperbolic — Robert Reich’s “If you took the greed out of Wall Street, all you’d have left is the pavement” — to the addicted — Mayor Michael Bloomberg’s “we need their taxes” (my paraphrase).

Both views are problematic, as I will address. But first, some historical context:

Commodities are Different (in a "Full World")

Author: 
John Fullerton

Foreign Policy’s recent “How Goldman Sachs Created the Food Crisis” reflects the dangerous, myopic thinking all too prone to “blame Wall Street” that is a natural consequence of Wall Street’s appalling, anti-social behavior in recent years.

Commodities are Different (in a "Full World")

Foreign Policy’s recent “How Goldman Sachs Created the Food Crisis” reflects the dangerous, myopic thinking all too prone to “blame Wall Street” that is a natural consequence of Wall Street’s appalling, anti-social behavior in recent years.

“US Debt Default Would Be a Moral Disaster”

Author: 
John Fullerton

 

So declared JPMorgan CEO Jamie Dimon regarding the prospect of a US default on its debt, after which he received a standing ovation at the University of Colorado’s Denver School of Business.  Hmm…Let’s do a little press review - the following items quoted from recent news articles:

“US Debt Default Would Be a Moral Disaster”

 

So declared JPMorgan CEO Jamie Dimon regarding the prospect of a US default on its debt, after which he received a standing ovation at the University of Colorado’s Denver School of Business.  Hmm…Let’s do a little press review - the following items quoted from recent news articles:

How Banks Make Money in Derivatives

Author: 
John Fullerton

The mystery of derivatives, the secretive multi-trillion dollar market that few understand but is believed to be at the heart of the financial meltdown needs illumination. Without it, policy makers have no chance of getting much needed regulation right.  The recent NY Times piece, “A Secretive Banking Elite Rules Trading in Derivatives” was unhelpful in this regard.  What follows is intended to be a laymen's and policy maker's guide to derivatives practices and profits.

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