Sat May 19, 2012

Could Glass-Steagall Have Stopped JPMorgan Loss?

Originally published on Mon May 21, 2012 11:15 am

JPMorgan, the largest bank in the United States, is seeking to minimize the damage caused by a $2 billion trading loss, disclosed earlier this month.
Mark Lennihan AP

Following JP Morgan's disclosure of a $2 billion loss, a small but increasingly vocal group of lawmakers and economists are arguing that a 60-year-old piece if financial legislation should never have been repealed in 1999.

They say the law, known as the Glass-Steagall Act, was so consequential that there's a direct link between its repeal and both the 2008 financial meltdown and JPMorgan's huge loss.

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Fri May 18, 2012

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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Fri May 18, 2012

Did Bank's Culture Lead To JPMorgan's Big Loss?

Originally published on Fri May 18, 2012 2:49 pm



The head of JPMorgan Chase, Jamie Dimon, has gotten an invitation to testify in front of the Senate Banking Committee about his bank's recent trading loss of at least $2 billion.


Dimon is very much the public face of his firm. In a Wall Street culture where banks are defined as much by the executives who run them is by the assets they hold. So, what kind of culture led to the multibillion dollar losses at JPMorgan Chase?

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Fri May 18, 2012
Planet Money

The Long, Long, Long Road To New Rules For Banks

Originally published on Fri May 18, 2012 2:49 pm

Would that big, bad JPMorgan Chase trade have violated the Volcker Rule?

It's too soon to say, despite the fact that the rule is part of a two-year-old law.

The Volcker Rule bans deposit-taking banks from making speculative bets. But it allows banks to make investments to hedge risks.

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Thu May 17, 2012
The Two-Way

As Feared, JPMorgan's Losses Are Growing; Reportedly At $3 Billion

Timothy A. Clary AFP/Getty Images

The word on Monday that JPMorgan Chase's losses from risky trades that went wrong could climb from $2 billion to perhaps as high as $4 billion in coming quarters is being bolstered this morning.

There's this report from The New York Times' Deal Book blog:

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