Tuesday, January 7, 2014

Marketplace: "Do Big Fines At J.P. Morgan Even Matter?" The Answer Is "No."

Jamie Dimon

"Laughing... all the way to the bank."

Learn more about this financial thug.

Wikipedia

http://en.wikipedia.org/wiki/Jamie_Dimon

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"Politics and Economics: The 101 Courses You Wish You Had"

http://paxonbothhouses.blogspot.com/2012/01/politics-and-economics-101-curricula.html

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Alan: For behemoths like J.P. Morgan, multi-billion dollar fines are simply "the cost of doing business." There is so much money to be made through malfeasance that Jamey Dimon and other Wall Street movers and shakers look on fines that are the size of some countries' Gross National Product as chump change. Until Americans wrap their heads around the complete, unquestioning normalization of felonies that reduce Al Capone's graft to a single water molecule in all the oceans of the world, we will neither recognize nor remedy the existential menace to justice and democracy.
http://www.marketplace.org/topics/business/do-big-fines-even-matter-jp-morgan-chase

Do big fines even matter for JP Morgan Chase

STAN HONDA/AFP/Getty Images

The headquarters of JP Morgan Chase on Park Avenue December 12, 2013 in New York. JP Morgan Chase and federal authorities are close to a USD $2 billion settlement over the bank's ties to financier Bernard L. Madooff that involve penalties and deffered criminal prosecution.

Audio File: http://www.marketplace.org/topics/business/do-big-fines-even-matter-jp-morgan-chase

Interview by Kai Ryssdal

January 6, 2014

Another year, another big fine for JP Morgan Chase. The bank's expected to soon be paying out another $2 billion in criminal and civil settlements to the federal government. This time for ignoring signs of Bernie Madoff's Ponzi scheme. That brings the grand total of fines JPM has paid in just the past year to just about $20 billion.

But the markets aren't paying any heed: Shares are up almost a percent today and CEO Jamie Dimon is still there. The company's doing just fine, it seems. But is there a limit?

Tim Fernholz from Qz.com thinks JPM's seeming invulnerability may be due to Wall Street's indifference to anything but the bank's financial performance:

"What I think to look for with Jamie Dimon is going to be, the company's latest earnings report. Ultimately on Wall Street and I think among the investors and these banks, they're an amoral bunch in the strictest sense of that term in that they do not care about the crime, they care about the stock price and the earnings."

Fernholz also says that it's important to remember that the fines and penalties we see today are punishing crimes and practices that aren't necessarily still happening.

"So it's hard to say...if they've cleaned up their act, and I think that's one of the reasons that prosecutors have reportedly opted for this deferred prosecution agreement," Fernholz says, "They're going to ask JP Morgan to really strengthen the controls that they supposedly put to watch out for things like Ponzi schemes or drug runners or any other kind of money laundering."

Featured in: Marketplace for Monday, January 6, 2014