I'd buy at $35. JPM is too big to fail. They will get bailed out if necessary. And kiss the Volcker rule goodbye - banks will argue that they're in too fragile a state to have more onerous restrictions imposed. Last night's event could turn out to be the best buying opportunity for bank stocks this year.
Maybe you are right, if JPM is a traditional commercial bank.
But do not forget that JPM is one of the largest dealers of derivative products in the world. The total notional value of such market is currently estimated at more than $100 trillion. Most of those contracts are not traded on exchange so that you have no place to know what the exact exposure of JPM on market events, such as 50pbs drop in 10 Treasury Note.
Do not also forget that collapse in RMBS market destroyed Bear Stearn and Lehman Brothers. They were biggest dealers in RMBS market. The inventory which they carry suddenly lost 30% of the value and they could not sell those toxic waste. That is why they are gone now.