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77% of JP Morgan’s Net Income Comes from Government Subsidies
JP Morgan’s credit rating would be much lower without government backing.
As Bloomberg noted last week:
JPMorgan benefited from the assumption that there’s a “very high likelihood” the U.S. government would back the bank’s bondholders and creditors if it defaulted on its debt, according to the statement. Without the implied federal backing, JPMorgan’s long-term deposit rating would have been three levels lower and its senior debt would have dropped two more steps, Moody’s said.
And as the editors of Bloomberg pointed out a couple of weeks ago:
JPMorgan receives a government subsidy worth about $14 billion a year, according to research published by the International Monetary Fundand our own analysis of bank balance sheets. The money helps the bank pay big salaries and bonuses. More important, it distorts markets, fueling crises such as the recent subprime-lending disaster and the sovereign-debt debacle that is now threatening to destroy the euro and sink the global economy.
***
With each new banking crisis, the value of the implicit subsidy grows. In a recent paper, two economists — Kenichi Ueda of the IMF and Beatrice Weder Di Mauro of the University of Mainz — estimated that as of 2009 the expectation of government support was shaving about 0.8 percentage point off large banks’ borrowing costs. That’s up from 0.6 percentage point in 2007, before the financial crisis prompted a global round of bank bailouts.
To estimate the dollar value of the subsidy in the U.S., we multiplied it by the debt and deposits of 18 of the country’s largest banks, including JPMorgan, Bank of America Corp. and Citigroup Inc. The result: about $76 billion a year. The number is roughly equivalent to the banks’ total profits over the past 12 months, or more than the federal government spends every year on education.
JPMorgan’s share of the subsidy is $14 billion a year, or about 77 percent of its net income for the past four quarters. In other words, U.S. taxpayers helped foot the bill for the multibillion-dollar trading loss that is the focus of today’s hearing. They’ve also provided more direct support: Dimon noted in a recent conference call that the Home Affordable Refinancing Program, which allows banks to generate income by modifying government-guaranteed mortgages, made a significant contribution to JPMorgan’s earnings in the first three months of 2012.
Way to suck at the government teat, Mr. self-proclaimed free market champion.
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JP Morgan sucks more than just teat.
and I have a big chubby dick that little bitch dimon can suck on
See...!
Crime pays
so when you make mega profits based on crony capitallism and take even greater risks to save your buddies involved in the ponzi, as you can't stop the crazy spinning wheel of bubblenomics, you can only be ultimately saved by those same cronies who are supposed to maintain a level playing field and in fact do just the opposite; as they are hook, line and sinker in cahoots. Circular reasoning of upside down world.
$14 BILLION a year subsidy to JP Morgan Chase&Co from the people.......
FUCK YOU'S JPM.................!!!!!!!!!!!!!
You see, the banksters have to keep injecting concepts like class warfare, racial and gender division and the latest fad sexual orientation discrimination in order to steal money from the regulars (all of us - rich/poor - black/brown/white - men/women - gay/straight - younameit/younameit)
and in the end, it decreases the standard of living for everyone - and people go pointing fingers at each other.
PEOPLE, its the banksters and federal government at the root of these problems - not the group of unfamiliar regulars around the way! One day I hope we can all get together on this stuff and take back the country (and the idea) that so many have given their life for.
Super post, GW, my good citizen!
And now for my Sunday rant, brought to you by your friendly, neighborhood informationist, sgt. doom:
The Darkest Alliance
When the news was first reported that Gary Webb, Pulitzer-prizing winning journalist and author of Dark Alliance: The CIA, the Contras, and the Crack Cocaine Explosion, had committed suicide by multiple gun shots to his head, we were highly skeptical.
Although the tide was going heavily against Gary in his professional life for exposing the truth, he reported that he was being routinely followed and surveilled. The last time we heard people report that, it turned out to be part of the COINTEL program.
While the possibility exists that Gary Webb did actually commit suicide, in all probability he was executed for getting too close to the truth: at street level, the intel agencies’ involvement with drug dealing and smuggling, but at the overall level, the entire structure consisting of an extraordinary financial enterprise, highly profitable in ill-gotten gains, at the cost of many innocent lives!
As with so many news events, the intelligence establishment’s MK ULTRA program was framed as a national security project run amok, but was it really?
When examined from the forensic financial view, forgetting for the moment those thousands maimed and murdered by their hideous program, it appears as an incredible financial scam of the highest order.
The drug companies, pharmaceutical corporations, benefitted tremendously from free research --- at the terrible cost to innocents victimized in human experimentation --- they also benefitted greatly from both public government contracts for those experiments, plus corollary research, as well as shadow budget funds, never accurately tracked, which flowed to their accounts for many years, and may have never stopped!
It doesn’t end here, for the drugs researched and created fall into two categories: legal and illegal.
The legal drugs profited those pharmaceutical companies in the commercial market, while illegal drugs produced multiple profit streams.
Illegal drugs are sold outright, for untaxed profit, but have also been used as the currency for political control and influence, exchanging drugs as payment for militias and armies to instigate insurgencies leading to various coups to overthrow democractically-elected governments.
Illegal drugs have also been used as a weapon; in much the same manner as the British Empire once used opium against the Chinese, flooding foreign markets, and select American areas, for nefarious purposes.
Viewed from afar, the MK ULTRA program appears a multi-faceted profit center of gargantuan proportion: the taxpayer-underwritten creation and production of drugs benefitting the economic elite, but also used to topple governments and regions for their further economic gain, while providing an infinite revenue stream from illegal markets.
They create the markets --- they control the markets --- and they use those markets to increase their wealth while destroying the lives of so many others!
Don’t think for a moment those profits and wealth simply remained at the executive suite --- they were shifted to buying their homes abroad, yachts, fleets of private aircraft --- and bribing endless numbers of politicians, both at home and abroad.
How many islands, castles and chateaus are owned outright from that blood money?
When David Rockefeller’s protégé, Peter G. Peterson through his Blackstone Group, purchased money laundering operations in Vanuatu and Vietnam, what money did he use?
When the Carlyle Group purchased Booz Allen (a major component of the privatized intelligence contracting), where did those buyout funds originate?
Years ago, John D. Rockefeller would criminally blow up the refineries of his competitors to control the market, while in modern times David Rockefeller has his lackey, Peterson and his Blackstone Group, purchase refineries, then shut them down; killing the competition, driving up oil prices, and surreptitiously stealing workers’ pension and retirement funds in the process!
But where does the money come from to undertake such perfidy?
These are not idle questions!
When the Rockefeller Foundation, and other Rockefeller family foundations under various names, disbursed funds for MK ULTRA experiments, illegal under both national and international laws, and claim philanthropic undertaking when it is profit-motivated in the most Satanic sense, those questions must be asked and investigated.
There was a concrete reason why CIA director, Richard Helms, ordered the immediate destruction of all MK ULTRA records when word of a congressional inquiry reached him. The very same Richard Helms whose grandfather, Gates McGarrah, occupied the position of chairman of the New York Federal Reserve Bank before becoming the first president of that central bank of all central banks, the Bank for International Settlements, in Switzerland.
When we drill down and find those who own the pharmaceutical corporations are, not surprisingly, also those who own the banks and oil companies and insurance companies, the pattern should be obvious to one and all --- excepting those who one observes aping the latest beer commercial they have viewed, incapable of thinking for themselves --- and that too is MK ULTRA!
Wonder at the colossal pushback to legalizing drugs?
Well, who owns the monopoly?
Today, with a privatized intelligence establishment and privatized prisons, and a completely corrupted, bought-and paid-for government, it continues.
John F. Kennedy once gave his definition of courage: A man does what he must – in spite of personal consequences, in spite of obstacles and dangers and pressures – and that is the basis of all human morality.
Gary Webb:
Born: August 31, 1955
Executed: December 10, 2004
John F. Kennedy
Born: May 29, 1971
Executed: November 22, 1963
Correction:
John F. Kennedy
Born: May 29, 1917
Executed: November 22, 1963
(My apologies)
Danny Casolaro
Born: June 16, 1947
Murdered: August 10, 1991
Reporter investigating Bush, PROMIS & TIA
Lt Colonel James Sabow USMC
Murdered: January 22, 1991
http://www.veteranstoday.com/2012/01/19/doctored-photo-in-marine-murder-...
http://www.youtube.com/watch?v=OYikJv8uIpw
Milton William Cooper
Born: May 6, 1943
Murdered: November 5, 2001
Patriot
June 2001 warning about 9/11
http://www.youtube.com/watch?v=zrTjPGy2k_U
Last broadcast, Cua Viet November 5, 2001
http://www.youtube.com/watch?v=ebG7By5PwWo
Richard Kelly Smyth was an American physicist, businessman, and NATO and NASA consultant on aerospace guidance technology. His Huntington Beach, California business, Milco International Incorporated, was a leading contractor to the US government on aerospace technology and an exporter of this technology.[6]
Between January 1980 and December 1982, Smyth allegedly illegally exported 15 shipments of krytrons to alleged Israeli intermediary and businessman Arnon Milchan of the Israeli company Heli Trading Company. Milchan then allegedly mediated the transfer of the krytrons to the Israeli government.[6]
Milchan also produced the films Pretty Woman, The War of the Roses, LA Confidential, The Devil’s Advocate, Mr. and Mrs. Smith, JFK, and Fight Club. In 2006, Forbes listed him as the 240th richest person in the world.[7]
Because krytrons are electronic switches capable of triggering nuclear explosive devices, the US government deems them munitions and only allows their legal export via a stringent licensing process, though they are central components of common items like copy machines and strobe lights.[6]
Operation Exodus, a US Customs program, was instrumental in Smyth’s capture. Ronald Reagan’s administration designed Operation Exodus to cut off smuggling of technology and goods to Soviet countries and funded the program by taking USD 30 million from the Department of Defense and giving it to Customs.[8]
Law enforcement arrested Smyth in May 1985. While awaiting trial he fled with his wife. Law enforcement discovered the couple in Malaga, Spain in July 2001. After his extradition to the US, he pleaded guilty in December 2001 to violating the Arms Export Control Act and to making false statements to US Customs. His sentence included 40 months in prison and a USD 20,000 fine, though he was immediately eligible for parole because of his old age. He was 72 at the time of sentencing.
Don Henry, 16, and Kevin Ives, 17 killed 1987. Mena Arkansas. Innocent victims of CIA Drug running.
The head of Teneo is still responsible for this. There is no statute of limitations for capital offenses.
Excellent post!
JfK lived to the ripe age of -8 years?
what year was BHO born, I mean hatched? 2006?
Thank you sgt_doom!
As I always like to say, special place in hell for these bastards! And bitches!
PS - and thanks for fucking nothing (Justice) Roberts!
Thieves to the right of us.
Thieves to the left of us.
Thieves all around us.
When will we say enough is enough?
Probably not until there's nothing left for the thieves to steal.
zorba,
Why not say this is intolerable, and unacceptable, and stop there.
"I understand a gift to himself but 500M is excessive" Andreas Papandreou (about 1984).
The next time a Greek complains about the present state of Greece, and starts to spew crap about revolution and other nonsense, ask HIM if that statement, back then was enough. Hint: It wasn't.
If I follow things correctly, this guy stayed prime minister of Greece for some time, his party is still around, in fact it was in government a few months ago.
You see, people don't mind theft. The people don't mind the the mud as long as you throw them a hand full of acorns every now and then. It's when the acorns stop that they start getting restless, the reason being, the acorns stopped. That's when the people say enough is enough. When the acorns stop. But by then it's too late. It's bacon time by then. We are all PIIGS. Or any other way you care to spell it.
Why am I no longer shocked by things like this?
JP Morgan actually gets 100% of its net income from government subsidies because if it wasn't for the 77% there would be no JP Morgan left.
Just another antisocial clever-stroke.
MKHS,
"Why am I no longer shocked by things like this this"?
There are three possible answers to your question, and only you will know the correct answer.
It could be that you are brain dead, completely lacking in any sense of ethics or right and wrong, personally corrupt beyond belief or one of those really myopic dummies whose mantra is "it doesn't affect me".
It could be that you are a Bankland Security psy-ops agent working diligently, with others, assigned to the ZH site, sometimes rmistakenly referred to as trolls, trying to administer anasthesia to the sheep. and generally trying to derail threads, and sow as much confusion on the site as possible.
You could just be a low double digit IQ individual parroting the mantra "I'm not shocked" which really translates to "I don't care" because you have heard it everywhere in the lamestream media and that other branch, the liestream media and you repeat it because you desperately want to be part of the mindless herd.
Finally, if you truly are not shocked by or concerned about the fact that you and every single person you know are being robbed 24/7 365 days of each and every year why would you even be coming to a site like ZH?
Hell, I guess you could actually fall into all three categories.
Nice, analysis. I guess you are a young idealist. After four years of this mess, you are still suprized by what is happening? Good luck in your quest, Don Quixote.
My point is that this situation we are all facing is not financial/political soap opera so let's not reduce it to that. Your comment added nothing useful to the content of the article, but rather tends to normalize a state of affairs that is intolerable and unacceptable. And being the first comment and so banal it could only undermine and blunt the authors intent to raise an alarm regarding JPM's robbing our treasury and our posterity of billions of dollars a year. It was not intended as a personal attack on you. I used your question as a platform to make a few observations about the comment section in general.
Desensitization to bad news.
Because your mind is starting to transfer from someone who didn't know about these things (and then got shocked), into the mind of a warrior where you no longer become shocked but instead furious and filled with rage, ready to destroy the banksters.
But...but but...their prop desk averages 100 million a day. How could they possibly fail?
Are you trying to tell me they couldn't make such wagers if they had to face the consequences of being wrong?
Or if they had a real cost of funds somewhere appreciably north of Zero.
And, BTW, the Gubamint's implied credit reting would be substantially better if they were not subsidizing anyfuckingthing, let alone the banks
SheepRev
No, I am just tired of the endless lies. If you got rid of the people, the world would be a nice place.
Nailed it .... bottom line
The problem with this is nobody cares. Do have to wonder who put the Fucks to JPMorgan though.
Is kind of funny how greed has no boundaries.