The government is in overkill mode toward JP Morgan Chase. It should not have to pay for the lousy mortgage securities foisted on FNMA and Freddie Mac by Bear Stearns and Washington Mutual. Those two firms needed to be absorbed by a stronger partner in the 2007-2008 financial crisis. And that stronger partner, JP Morgan, did not have the time to discover exactly what spurious securities it was putting on its own balance sheet.
Why should JP Morgan pay for crimes it did not commit itself? After all, these lousy securities were not sold by JPM to the housing authorities. They could properly argue they were not aware of all the troubles they were assuming in the bailouts of these two troubled firms.
To my way of thinking JP Morgan should pony up whatever losses they caused for FNMA and Freddie Mac for the mortgage securities its own employees put together and flogged for prices that were not going to stand up in the meltdown. That would be a fair assumption of guilt to make good on.
Overkill is not called for here. Yes, he regulators are late on the curve for going after the big banks for their sins. The government has looked bad spending hundreds of billions to save Wall Street in order for the banks to show extraordinary profits, while the middle class was getting squeezed and unemployment was really 14%.
Playing catch up appears to have infected some regulators with the revenge factor. That’s understandable. The public have been waiting 4 long years for retribution against Wall Street. As the biggest target, JP Morgan must pay a whopping fine for falsely reporting the loss on the “London whale” trades made with the bank’s own money. This is fair and square.
The government appears to be in overkill mode as the public has been braying for blood from the too-big-to fail banks they helped survive with transfusions of hundreds of billions of bailout money. This is understandable in the sense of the revengeful feelings of the middle class and the people who are out
JP Morgan is responsible for the past misdeeds. If they aren't, corporations would commit massive frauds and then sell themselves to avoid prosecution and penalties. It's that simple. Jamie knows that.
I completely agree. In 2008, the FDIC desperately needed JPM to absorb WAMU. And now 5 years later the Justice Department is seeking $13 billion in "charges" against J. P. Morgan. I think Justice Secretary Eric Holder and President Obama need to explain all this to the American people, On Live TV!!! ..Talk about a double cross!!
See Jon Stewart's 10/29/13 show. Bear & Wash were not "absorbed by a stronger partner." They were bought cheap by an adversary which thought it was taking full advantage of their weakened condition. But Dimon & fans in the biz media were too busy hi fivin' each other to consider the liabilities JPM was taking on.
Anyway you look at it, the stock holders got the shaft. Dimon goes into a meeting with Holder and comes out unscathed, but the innocent stockholder gets the shaft.
No way stockholders should have been held responsible for Bear Stearns and Wash Mu.
\Where does all that money go?
JPM shouldn't have bought the other companies in the dark and that is there fault. JPM is needs to be responsible for their action. If it would have turned out to be positive they would have been happy to give themselves big bonuses so if the opposite happen which it did then they need to pay for the mistake.