Banking

6:48am

Tue June 12, 2012
The Two-Way

JPMorgan Knew Of Risks, 'WSJ' Reports

"Some top JPMorgan Chase executives and directors were alerted to risky practices by a team of London-based traders two years before that group's botched bets cost the bank more than $2 billion," The Wall Street Journal is reporting.

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2:39am

Mon June 11, 2012
Planet Money

Three Ways To Stop A Bank Run

Originally published on Tue June 12, 2012 9:11 am

This is what you don't want.
AFP AFP/Getty Images

There's a slow-motion bank run happening in Europe, as depositors move their money from financially troubled countries like Greece and Spain to stronger countries like Germany.

Banks take depositors' money and lend it out. So even a strong bank is in trouble if all the depositors suddenly decide to pull their money out. A full-blown run can sink a bank in an afternoon.

Once a run starts, there are basically three ways to stop it.

1. Slow it down

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12:59am

Fri June 1, 2012
Planet Money

A Front-Row Seat At A Bank Run

Originally published on Fri June 1, 2012 7:04 am

Petros Giannakouris ASSOCIATED PRESS

A decade ago, investors thought Greece would flourish on the euro. Money poured in, and banks started lending it out. Thefilos Papacostakis, a bank teller at Alpha Bank in Thessaloniki, got to hand out a lot of that money.

Last month, Thefilos says, his bosses called him in for a meeting. They told him things were about to get worse. When countries are in this kind of trouble, the bosses said, people panic and pull their money out of banks.

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9:53am

Wed May 30, 2012
The Two-Way

Bank Bailout Fund Floated As Way To Calm Crisis In Europe

Originally published on Wed May 30, 2012 2:22 pm

The Spanish bank Bankia in Madrid has asked the government to inject $24 billion. The European Commission is proposing a "banking union" to help eurozone governments rescue banks.
Dominique Faget AFP/Getty Images

There have been very few days lately when worries about Europe's debt crisis weren't growing.

As Spain struggles to shore up its third-largest bank with a $24 billion bailout, the country's borrowing costs continue to go through the roof as fears lingered about a possible run on its banks.

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8:50am

Fri May 18, 2012
Business

JPMorgan's Troubles And The Price Of Eggs

Originally published on Fri May 18, 2012 2:20 pm

Do complex Wall Street transactions ever do anything to help average people? To answer that question, we consider the case of an imaginary company, Chickens LLC, that's looking to grow.
Joern Pollex Getty Images

Journalists have spent many days and millions of words hashing over the news that banking giant JPMorgan Chase lost billions of dollars trading "synthetic" derivatives.

I am one of those journalists who, more or less, can understand what the bank says it was trying to do, i.e., hedge against loan losses. But here's what I have a hard time explaining:

What does this kind of complex trading have to do with the price of eggs?

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