News / Economy

JPMorgan Trading Losses Prompts New Probe, Concerns About Wall Street

Law enforcement secure grounds of JP Morgan Chase annual stockholders meeting in Tampa, Fla., May 15, 2012.Law enforcement secure grounds of JP Morgan Chase annual stockholders meeting in Tampa, Fla., May 15, 2012.
x
Law enforcement secure grounds of JP Morgan Chase annual stockholders meeting in Tampa, Fla., May 15, 2012.
Law enforcement secure grounds of JP Morgan Chase annual stockholders meeting in Tampa, Fla., May 15, 2012.
TEXT SIZE - +
JPMorgan is facing increasing pressure to explain recent losses.  Last week, the world's largest bank disclosed a loss of at least $2 billion from trades that were supposed to protect the firm from risk.  Now the FBI is looking into whether any laws were broken, and shareholders are looking for assurances that it won't happen again.

Just days after JPMorgan Chase reported the loss, Jamie Dimon, the bank's embattled CEO, apologized to shareholders. "This should have never happened.  I can't justify it.  Unfortunately, these mistakes were-self inflicted," Dimon said.

On Tuesday, the FBI said it was launching a probe. And, on Wednesday, lawmakers held a hearing to determine if new regulations are needed.  New laws that go into effect in July would limit some banks from making proprietary bets with publicly-insured money.

Financial strategist Peter Cardillo blames the new regulations on Wall Street's appetite for high-risk gambles. "There's no question, derivatives have turned Wall Street into a casino. There's no question about that," Cardillo said.

Although Cardillo has concerns about a rush to over-regulate, Treasury Secretary Timothy Geithner says the JPMorgan fiasco makes a powerful case for stronger financial oversight.

"The test of reform is not whether you can prevent banks from making mistakes, errors of judgement  Risk management, that's going to happen.  That's inevitable.  The test of reform should be do those mistakes put at risk the broader economy, the financial system or the taxpayer?," Geithner said.

Ironically, JPMorgan's Dimon has been among the harshest critics of Wall Street reform.  But shareholder Peter Skillern wonders who's watching their CEO -- who also happens to be the company's chairman.

"So who oversees that unit?  Jamie.  Who oversees Jamie?  Jamie. That's the problem.  He's his own boss," Skillern said.

Despite their concerns, shareholders demonstrated support for their chairman -- voting against a proposal to split his position into two separate jobs.  Outside, protesters threw eggs at a picture of Dimon and expressed a litany of complaints against what they call the "fat cats" of Wall Street.

"The big banks need to be broken up, as well as reducing principal for homeowners that are underwater with their mortgages and clearly for them to stay out of, keep their money out of politics, which is really destroying our democracy right now," one protester said.
 
JPMorgan's trading blunder has already prompted several resignations.  Analysts say more employees are likely to lose their jobs.

You May Like

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

John the XXIII and John Paul II will be made saints in a ceremony at St. Peter’s Square on April 27 More

Thailand Reacts to Plots Targeting Israelis

Authorities hope arrest of two Lebanese suspects will disrupt plot to attack young Israeli tourists More

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

'Once Upon a Forest' takes viewers deep into heart of tropical rainforest More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Pope Francis Hopes Dual Canonizations Will Reconcile Churchi
|| 0:00:00
...
 
🔇
X
Jerome Socolovsky
April 22, 2014 4:14 PM
On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

French filmmaker Luc Jacquet won worldwide acclaim for his 2005 Academy Award-winning documentary "March of the Penguins". Now Jacquet is back with a new film that takes movie-goers deep into the heart of a tropical rainforest - not only to celebrate its grandeur, but to make the case for its survival. VOA's Rosanne Skirble reports.
Video

Video Boston Marathon Bittersweet for Many Runners

Monday's running of the Boston Marathon was bittersweet for many of the 36,000 participants as they finished the run that was interrupted by a double bombing last year. Many gathered along the route paid respect to the four people killed as a result of two bombings near the finish line. VOA's Carolyn Presutti returned to Boston this year to follow two runners, forever changed because of the crimes.
Video

Video Pacific Rim Trade Deal Proves Elusive

With the U.S.-led war in Iraq ended and American military involvement in Afghanistan winding down, President Barack Obama has sought to pivot the country's foreign policy focus towards Asia. One aspect of that pivot is the negotiation of a free-trade agreement among 12 Pacific Rim nations. But as Obama leaves this week on a trip to four Asian countries he has found it very difficult to complete the trade pact. VOA's Ken Bredemeier has more from Washington.
Video

Video Robotic Mission Kicks Up Lunar Dust

A robotic mission to the moon was deliberately crashed onto the lunar surface late last week, but not before scientists had collected data gathered by the spacecraft which was designed to self-destruct. VOA's Rosanne Skirble reports on the preliminary findings of the craft, called LADEE - an acronym for Lunar Atmosphere and Dust Environment Explorer.
Video

Video Boko Haram Claims Responsibility for Bombing in Nigerian Capital

The Nigerian militant group known as Boko Haram has claimed responsibility for a bombing in the capital on April 14th that killed 75 people. In the video message, Abubakar Shekau, the man who says he ordered the bombing, says nothing about the mass abduction of more than 100 teenage girls, most of whom are still missing. Heather Murdock has more for VOA from Abuja.
Video

Video Ukraine Developments Hang Over Obama Trip to Asia

President Barack Obama's trip to Asia this week comes as concerns over Beijing's territorial ambitions are growing in the region. Those concerns have been compounded by Russia's recent actions in Ukraine and the possibility that Chinese strategists might be looking to Crimea as a model for its territorial disputes with its neighbors. VOA's Bill Ide has more from Beijing.
Video

Video Autistic Adults Face Housing, Job Challenges

Many parents of children with disabilities fear for the future of their adult child. It can be difficult to find services to help adults with disabilities - physical, mental or emotional - find work or live on their own. The mother of an autistic boy set up a foundation to advocate for the estimated 1.2 million American adults with autism, a developmental disorder that causes communication difficulties and often social difficulties. VOA's Faiza Elmasry reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.