JP Morgan Chase (the spider hole Jamie Dimon lives in) posted a 3.3bn first quarter profit today despite allotting 7 billion to cover losses on its consumer credit divisions. How does a bank lose that much money and still make billions? A big part of it is the “special” accounting rules and tax credits it gets from foreclosing on homes thanks to a parting shot from the Bush Crime Family. But the cash flow to keep their 17 billion in bonus checks from bouncing comes from its investment bank division.
The big banks all have investment bank divisions and are churning the markets to drive up stocks that they own so that they can in turn sell to the managed funds who have no choice but to invest. Another cash cow is high speed trading with a built in programming bias so they can buy any stock their clients want a split before the price increase is recorded and resell it at a profit.
Jamie Dimon let go with a blistering tirade last month in his annual letter to shareholders, he criticized the "demonization" of big banks and argued for the economic benefits of outsized financial institutions. But when under oath he maintains complete ignorance of the working of the economy or why the sub-prime mortgage securitization/financial derivative scheme his bank was running collapsed the world’s economy. He does seem to know enough about it to declare today that if Congress allows the Commodity Futures Trading Commission to regulate those same derivatives it will cost his bank two billion dollars.
AG Holder told the Senate Judiciary Committee that he expects more trials for the people responsible for the financial collapse. Really? The FBI warned everybody two years before the collapse that mortgage brokers were committing systemic fraud. The AG’s of all 50 states tried to curtail the practices of the big mortgage banks but the Bush Adm invoked a 1863 law to take away state oversight of nationally chartered banks. A law that had not been used since Lee surrendered to Grant. Oh, and Federal oversight of these big banks was exactly… none.
Speaking of the Confederacy; Sen. John Cornyn (R-Texas) asked AG Holders why there hadn't been more "show trials" for alleged white-collar criminals. It’s not clear if he was being dismissive of Holder (he didn’t call him “boy”) or if this is just the way a jack booted thug like him thinks the DOJ ‘should’ work. If the Republicans weren’t holding up over 200 appointments including senior positions at the DOJ there might be some of those show trials to watch. www.prairie2.com