Is JP Morgan a Bank Or a Government-Funded Casino?

[marmar]

from HuffPost:



Raymond J. Learsy
Scholar and Author of 'Over a Barrel: Breaking Oil’s Grip on Our Future'

Posted: June 9, 2009 06:28
Is JP Morgan A Bank Or A Government Funded Casino?




CNBC reported yesterday that up to 9 Banks will soon be allowed to pay back their Tarp loans. JP Morgan has received some $25 billion from the Tarp program and has petitioned the government to permit repayment and will in all likelihood be among the banks permitted to do so.

Yet, by along stretch that is not the end of the government's involvement with JP Morgan. The government stood able and ready to assist the financial sector through probably the most difficult financial crisis since the Depression, and certainly JP Morgan was one of the main beneficiaries of those actions. The $25billion may no longer be needed now, but it was certainly crucial then to reestablish public confidence and trust in the system and each bank's viability. The ultimate aim was and is to permit these banks to function as banks making it possible for JPMorgan and others to continue lending to business and consumers, unfreezing the credit markets and returning badly needed liquidity to the system. That was what was meant to be, but our banking institutions seem to have lost all ballast to what a bank is meant to be doing and its responsibility to its depositors and the public which in this instance helped it stay alive.

Just last week June 6,2009, "Tanker Operator" (http://www.tankeroperator.com/news/todisplaynews.asp?NewsID) a leading source of tanker operations info reported that the good people of JP Morgan hired the good ship, or better put, the VLCC Super Tanker 'Front Queen' for nine months, I repeat nine months, to carry 2 million barrels of heating oil for storage duty off Malta. One is compelled to question how many homes in California, in Michigan, or any where in the United States could have been saved from foreclosure, how many payrolls could have been met with the hundreds of millions ploughed into an oil trading gambit sitting off the coast of the far distant Mediterranean island of Malta. Is this why JP Morgan is rushing to repay its Tarp monies so that its free wheeling ways of the past can proceed without the possibility of Tarp constraints.

Our banks' propensity to risk other people's monies, while latching on to the public purse, seems to continue unabated. When a bank such as JP Morgan plays in the oil casino it does so with depositors monies which are guaranteed in part or in whole by our government's Federal Deposit Insurance Corporation. Is that what bank deposits are meant to be for?? Is this a bank fulfilling its banking mandate? And this from a "bank" that has received an implicit guarantee from the government that in case of extremis the taxpayers will bail it out because the alternative would be unthinkable.

The very least one can ask is that the bank act as a bank and not as a trading house, making casino like bets that if they go sour, the taxpayers would be expected to pick up the pieces. .......(more)

The complete piece is at: http://www.huffingtonpost.com/raymond-j-learsy/is-jp-morgan-a-bank-or-a_b_212971.html