Subscribe: RSS Feed | Twitter | Facebook | Email
Home | Contact Us

JP Morgan’s Perfect Quarter More Evidence “Game Is Fixed”

Posted by Larry Doyle on May 11, 2010 2:15 PM |

First Goldman Sachs. Now JP Morgan.

The shop where I worked from 2000-2006 released a report highlighting the fact that it made money each and every day of the 1st quarter. Thanks again to Matt for bringing this story to my attention. Bloomberg highlights, JP Morgan Traders Match Goldman’s Quarter with No Trading Loss:

JPMorgan Chase & Co.’s traders matched those at Goldman Sachs Group Inc. in making money every day of the first quarter, a first for both companies.

Daily trading revenue averaged $118 million on each of the 64 days in the first quarter, JPMorgan said in a regulatory filing yesterday with the U.S. Securities and Exchange Commission.

JPMorgan’s trading revenue from investment banking, its chief investment office and consumer lending division exceeded $90 million on 39 of those days, or more than half the time, according to the filing. Trading revenue surpassed $180 million on nine days, or 14 percent of the time, the second-largest U.S. bank said.

Believe me, having worked in the industry for 23 years, traders and firms do not make money each and every day. These results are a reflection of easy money provided by the Fed, lessened competition leading to a financial oligopoly in our country, and a variety of programs and mechanisms which are conduits funneling money into the banking system.

While the traders on Wall Street may believe it is their talents (and plenty are truly talented), the system is rigged and the game is fixed. Uncle Sam is the accomplice in hopes that revenues being generated currently on Wall Street can be utilized to write down the values of loans which are mismarked, have defaulted, or will default.

Is JP Morgan taken aback by these revenues? Publicly, I believe they are. How do we know? Read the statement put forth by the bank:

JPMorgan said it doesn’t expect the same trading revenue throughout the year. “The high level of trading and securities gains in the first quarter of 2010 is not likely to continue throughout 2010,” the firm said in the filing.

How do they know this to be the case? Are they soothsayers? Do they know the ‘fix’ is going to end at some point in the second quarter or beyond? If they are taken aback by these results, then perhaps they could ease up on their credit card rates or other lines of credit utilized by American taxpayers.

While JP Morgan may want to project an air of public concern over their results, rest assured senior management inside the organization is laughing all the way to the bank at these results, regardless of the fix.

LD

Please subscribe to all my work via e-mail, an RSS feed, on Twitter or Facebook.

  • Great insight Larry, especially that last quote at the end of your post. Is JP Morgan basically saying there that either the market is headed downward for the remainder of 2010, or that the market is at least going to be much more uncertain and volatile for the remainder of 2010?

  • Lawson

    Add B of A to the list. Perfect 63 for 63.

  • Mike

    I think J.P. Morgan is trying to make themselves seem a little more “human” or fair by predicting an imperfect record for 2H. As if it matters what the market does… They may realize that perfect records are only going to make people ask more questions.






Recent Posts


ECONOMIC ALL-STARS


Archives