However, to provide the moral tenor of JPMorgan Chase, here is one week of Reuters daily new about the bank this past week:
Wall St Week Ahead: Investors crave more strong bank results.
JPMorgan Chase Q4 commodities risks steady after commodity markets rally.
Ex-JPMorgan banker loses whistleblower case.
Stocks rise on JPMorgan results, euro rallies.
AIG recapitalization deal with JPM and others closes, share sale looms.
The news is consistently marbled with aggressive and risky behavior. Also the earlier news that JPMorgan knew of Bernie Madoff’s $50B Ponzi scheme and did nothing about it is another example of the bank stepping morally out of bounds.
And Felix is not alone, as the NYTimes Ron Leiber analyzes the recent spate of banks raising various fees for their depositors. Here is Ron’s take:
Right before the new year, meanwhile, JPMorgan Chase informed customers that under certain circumstances it would add monthly fees to many of the accounts it inherited from the now-deceased Washington Mutual….“We don’t want to raise fees on our customers,” a company spokesman said. “But unfortunately, regulation is forcing us to do it. And as a result, some customers may end up unbanked.”
This statement is striking for a number of reasons, and the eye-popping earnings the bank announced on Friday don’t exactly make the company more worthy of sympathy. So I’ve spent the last week trying to figure out why I was so sure I did not believe it the instant I read it.
Ron goes on to show how deceitful the bank is being about their fee trends and the very opposite pressure from regulators – that is for them to lower fees. But lets return to Reuter’s Felix Salmon and give him the last word on JPMorgan Chase:
JP Morgan Chase CEO Jamie Dimon and CFO Doug Braunstein said on their earnings call today that roughly 5% of bank customers “may be pushed out of the banking system” as a result of the Durbin Amendment on debit interchange. Ron says he “sincerely doubts” that’ll happen — but I take it more as a threat than a forecast. Banks can kick out any customers they like — even embassies. The not-so-subtle implication here is that if the Consumer Financial Protection Bureau starts getting all bleeding-heart on America’s biggest banks by asking them not to gouge their poorest customers, then just maybe those poorest customers might find themselves with no bank at all.
This is pretty evil, and I hope that the government doesn’t stand for it — especially when JP Morgan earned $17.4 billion this year. Is it fair to ask JP Morgan to use some tiny part of the profits from its investment banking, wealth management, and other businesses to cross-subsidise the cost of providing free banking for poorer customers? Frankly, yes, it is. It’s the least that they can do, given the billions they’re making from the Fed’s loose monetary policy and Treasury’s implicit backstop on the debts of too-big-to-fail institutions. But instead they’re pushing back, grubbing for every dollar they can extract from those who can least afford it. Shameful.
Personally Ye Editor disagrees with Feilx. If all the US Government can get out of the major banks, after $3trillion and counting in financial welfare payments is cheaper banking fees for 5% of their poorest depositors – thats no bargain. But I do agree with Felix that the JPMorgan Chase and the other major banks are pushing back hard on the Federal government. And why not? The Presidential election cycle is starting up this Spring. Both political parties are prostrate before the bankers and their now unlimited campaign funding [much of which can be anonymous until the issue is decided in the Supreme Court perhaps 2-3 years away]. Let me assure you Bankers know when they have you by the proverbials – and that is why the big Walls Street Banks are called Banksters.