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JP Morgan Chase: We Actually Benefit From Downturns


By Patrick   Follow   Sun, 3 Mar 2013, 9:09am PST   3,236 views   85 comments   Watch (0)   Share   Quote   Permalink   Like   Dislike  

http://www.huffingtonpost.com/2013/02/26/jamie-dimon-benefit-downturns_n_2765462.html

Like most soft-spined Americans, you probably have painful memories of the financial crisis and consequent recession. Perhaps you even think of those things as "bad." Fortunately, Jamie Dimon is not like the rest of you losers. That is because, unlike you, Jamie Dimon is CEO of JPMorgan Friggin' Chase, America's greatest bank, which just so happens to snack on financial crises and recessions like so much KIND bar.

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bob2356   befriend   ignore   Sun, 9 Feb 2014, 4:04pm PST   Share   Quote   Like   Dislike (1)     Comment 46

Reality says

Prove what? That the AIG stock is for a holding company? You can look it up and verify for yourself. That the AIG company in a given state is its own corporation? Again, you can check with your state insurance regulator or the company itself to verify.

The London AIG was its own corporation. Neither AIG the holding company nor the various AIG insurance companies in each state was liable to London AIG losses.

Show me where in corporate law that the holding company is not liable for the subsidiaries. You claim it's true. Based on what?

Reality   befriend   ignore   Sun, 9 Feb 2014, 4:05pm PST   Share   Quote   Like   Dislike (1)     Comment 47

bob2356 says

Reality says

Legal Tender Law means those owed money have to accept the legal tender as payment for debt. What do you think the compensatory clause in a contract stipulates? A debt created due to lack of fulfillment, right?

Again so what? Do you wish the court to stipulate cows and goats as payment in contract disputes? Do you actually have a point of any kind?

Do you think businesses contracts did not exist before 1913?

bob2356   befriend   ignore   Sun, 9 Feb 2014, 4:07pm PST   Share   Quote   Like (1)   Dislike (1)     Comment 48

Reality says

bob2356 says

bob2356 says

What do you envision as a workable system of no government without anarchy

So what's the plan stan?

What are you talking about? The US was not in a state of anarchy before the founding of the FED in 1913.

BTW, don't confuse anarchy with chaos. The two are different concepts.

The word you've been searching for all this time is gold standard?

bob2356   befriend   ignore   Sun, 9 Feb 2014, 4:08pm PST   Share   Quote   Like (1)   Dislike (1)     Comment 49

Reality says

Do you think businesses contracts did not exist before 1913?

Yes and they specified legal tender, US dollars just like today.

Reality   befriend   ignore   Sun, 9 Feb 2014, 4:09pm PST   Share   Quote   Like   Dislike (1)     Comment 50

bob2356 says

Show me where in corporate law that the holding company is not liable for the subsidiaries. You claim it's true. Based on what?

That's what a separately incorporated entity does:shielding the owners from losses beyond existing investment. Do you have no clue about why the concept of "corporation" was invented? London AIG was registered and incorporated in the City of London, hence a distinct entity from the US-based AIG holding company.

Reality   befriend   ignore   Sun, 9 Feb 2014, 4:11pm PST   Share   Quote   Like   Dislike (2)     Comment 51

bob2356 says

The word you've been searching for all this time is gold standard?

gold, silver, bimetallic, any objective standard would do. So that money can not be created at will to enrich a tiny group at the expense of diluting the money of everyone else, nor arbitrary bailouts at the expense of everyone else.

Reality   befriend   ignore   Sun, 9 Feb 2014, 4:14pm PST   Share   Quote   Like (1)   Dislike (2)     Comment 52

bob2356 says

Do you think businesses contracts did not exist before 1913?

Yes and they specified legal tender, US dollars just like today.

Before 1913, it was a money that could not be arbitrarily created out thin air without consequences in "backing." It was a sound money that did not give banksters special privileges in changing the unit of accounting.

bob2356   befriend   ignore   Sun, 9 Feb 2014, 4:37pm PST   Share   Quote   Like (1)   Dislike     Comment 53

Reality says

That's what a separately incorporated entity does:shielding the owners from losses beyond existing investment. Do you have no clue about why the concept of "corporation" was invented? London AIG was registered and incorporated in the City of London, hence a distinct entity from the US AIG holding company.

Yes I have a very good clue about incorporation, do you? I also have a good clue about the word subsidiary. I've also read a couple good books on the crash that detailed the story of AIG and AIGFP.

Since you don't have a clue and obviously never actually read up on the AIG debacle here is the story. AIGFP started in 1987 on Third Avenue Manhatten, NY USA. In 1989 AIGFP moved to n Wilton, CT. AIGFP is still legally headquartered there. AIGFP is a US corporation even though they were operating in London. AIG has taken 62% of the profits from AIGFP from the very beginning. That means AIG was legally responsible for 62% of any losses. That's why the credit downgrades were for the entire AIG corporation not just AIGFP.

It's public record, look it up. Yes AIG was most definately legally responsible for AIGFP loses under US law. I should have just found the book and looked earlier rather than arguing with you.

bob2356   befriend   ignore   Sun, 9 Feb 2014, 4:41pm PST   Share   Quote   Like (1)   Dislike (1)     Comment 54

Reality says

Before 1913, it was a money that could not be arbitrarily created out thin air without consequences in "backing." It was a sound money that did not give banksters special privileges in changing the unit of accounting.

Good or bad, it's the system used everywhere on the planet Either you can move to mars or live with it. It's a binary solution set.

bgamall4   befriend   ignore   Sun, 9 Feb 2014, 4:56pm PST   Share   Quote   Like (1)   Dislike     Comment 55

CaptainShuddup says

Every time we think we've bailed them out...

They bail them selves back in!

Even you can't swallow the arrogance of that jackal, Captain!

Reality   befriend   ignore   Sun, 9 Feb 2014, 11:06pm PST   Share   Quote   Like   Dislike (1)     Comment 56

bob2356 says

Yes I have a very good clue about incorporation, do you? I also have a good clue about the word subsidiary.

Apparently you don't have a clue about either concepts; see below:

bob2356 says

AIG has taken 62% of the profits from AIGFP from the very beginning. That means AIG was legally responsible for 62% of any losses.

That's a nutty statement. AIGFP was a separate legal entity from AIG, which was/is a sharehold in AIGFP. If you own shares of CitiBank and get dividends for years, would you be personally liable for its losses as a result? Of course not! That's the whole idea about the Corporate Veil . . . and the reason why Corporations were invented to begin with: owners are not liable beyond their existing investment in the corporation.

On top of that, even if AIG the holding company were somehow dragged into being liable, that would still not drag the various AIG insurance companies in the different states into this or devour their insurance reserves, which were always set aside per state insurance regulations. So the whole "nightmare scenario" about people losing their life insurance, car insurance, home insurance etc.. if AIGFP or AIG holding company went down was complete and utter nonsense and fabricated lie!

Reality   befriend   ignore   Sun, 9 Feb 2014, 11:09pm PST   Share   Quote   Like (1)   Dislike (2)     Comment 57

bob2356 says

Reality says

Before 1913, it was a money that could not be arbitrarily created out thin air without consequences in "backing." It was a sound money that did not give banksters special privileges in changing the unit of accounting.

Good or bad, it's the system used everywhere on the planet Either you can move to mars or live with it. It's a binary solution set.

As a worldwide system, it's been only 4 decades old, since Nixon closing the gold window in the early 70's. Those 4 decades have proved it to be a dismal failure, as evidenced by the drastic increase in wealth disparity and frequent financial instability in those same 4 decades.

bob2356   befriend   ignore   Mon, 10 Feb 2014, 12:06am PST   Share   Quote   Like (1)   Dislike (1)     Comment 58

Reality says

bob2356 says

Reality says

Before 1913, it was a money that could not be arbitrarily created out thin air without consequences in "backing." It was a sound money that did not give banksters special privileges in changing the unit of accounting.

Good or bad, it's the system used everywhere on the planet Either you can move to mars or live with it. It's a binary solution set.

As a worldwide system, it's been only 4 decades old, since Nixon closing the gold window in the early 70's. Those 4 decades have proved it to be a dismal failure, as evidenced by the drastic increase in wealth disparity and frequent financial instability in those same 4 decades.

You said 1913, read your own post. Now it's the 70's. Do you always argue with yourself? My question stands, are you moving to mars? I never said it was a good system, but it's the system world wide, it's not going to change, and I have to live within it preferably without bitching.

Reality   befriend   ignore   Mon, 10 Feb 2014, 12:23am PST   Share   Quote   Like   Dislike (2)     Comment 59

bob2356 says

You said 1913, read your own post. Now it's the 70's. Do you always argue with yourself?

Do you not know the basic monetary history of the 20th century? here's the brief outline:

1913 founding of the FED; prior to that the US was on the gold standard.

1933 de-linking of gold to US$ within the US for domestic trade, banning private gold bullion ownership within the US and voiding all gold clauses in contracts; international trade was settled in gold, hence those cruisers shipping gold over the Atlantic for munition purchases during WWII

1944 Bretton Woods Agreement: linking the US$ to gold internationally via a gold-exchange standard, while all the other countries set their currencies vis the US$. Other countries earning US$ could exchange those US$ for gold at fixed rate; i.e. pegging the US$ to gold for international trade.

1971 Nixon unilaterally abrogated on the pledge to exchange gold for US$. The US$ hence became pure fiat currency. Consequently, almost all currencies in the world became pure fiat.

My question stands, are you moving to mars? I never said it was a good system, but it's the system world wide, it's not going to change, and I have to live within it preferably without bitching.

Change is constant. As you can see in the above list the changes in the monetary system in the 20th century alone.

Robert Sproul   befriend   ignore   Mon, 10 Feb 2014, 12:29am PST   Share   Quote   Like   Dislike (1)     Comment 60

bob2356 says

it's not going to change,

It will change all right.
Like every system before it, it will collapse.
This fiat delusional schema based on a declining resource and a teetering Empire's unsustainable military expenditures is actually getting long in the tooth.

bob2356   befriend   ignore   Mon, 10 Feb 2014, 12:44am PST   Share   Quote   Like (1)   Dislike (1)     Comment 61

That's a nutty statement. AIGFP was a separate legal entity from AIG, which was/is a sharehold in AIGFP. If you own shares of CitiBank and get dividends for years, would you be personally liable for its losses as a result

It may be a nutty statement but it's a fact documented in many places. The treasury department, the justice department, the ny ag, and pretty much every financial analysis of the crisis disagrees with you. AIG didn't get dividends from AIGFP. They were directly contracturaly involved in financing and profits. Here are some articles that might help explain it to you.

http://talkingpointsmemo.com/muckraker/the-rise-and-fall-of-aig-s-financial-products-unit
http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=3&ved=0CEUQFjAC&url=http%3A%2F%2Fharaldhau.com%2FThe_Man_Who_Crashed_the_World.pdf&ei=6_j4Utb-KOTK0gHkwoH4Cw&usg=AFQjCNFLc9EbdiKSwYRB7mdI_5-szRrdzQ&bvm=bv.60983673,d.dmQ
http://blogs.reuters.com/felix-salmon/2009/07/02/how-aig-fp-brought-down-the-world/
http://hnn.us/article/69572
http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=19&ved=0CGkQFjAIOAo&url=http%3A%2F%2Fclubs.ntu.edu.sg%2Frms%2Fresearchreports%2FAIG.pdf&ei=vvr4UqDiJ8Xv0gHFuYGwAQ&usg=AFQjCNHjWI12cUko37skjIgMzAZDNHiT9gReality says

What happened to your idea that AIGFP was a british company not subject to us law? I guess you looked at their sec filings finally. Do you want to regal me again with your extensive knowledge of corporations?

You do realize that there were other major financial problems at AIG beyond AIGFP. I think it was in NC that the holding company itself lost 50 billion in bad trades. AIGFP only lost 45 billion. There were others.

Reality says

So the whole "nightmare scenario" about people losing their life insurance, car insurance, home insurance etc.. if AIGFP or AIG holding company went down was complete and utter nonsense and fabricated lie!

There was never any nightmare scenario about people losing their car insurance. What am radio station is that from. The nightmare scenario was not paying off the cds obligations and simultanuously bringing down every major financial institution that had insured their crappy ponzi scheme financial mortgage products through AIGFP.

I always thought AIG should have bankrupted then defaulted on the cds/s and any bank that went under should have been nationalized. It would have been much cheaper and easier plus we would have gotten rid of the tbtf bank problem. bonus points for that.

bob2356   befriend   ignore   Mon, 10 Feb 2014, 12:47am PST   Share   Quote   Like (1)   Dislike (1)     Comment 62

Reality says

Do you not know the basic monetary history of the 20th century? here's the brief outline:

I know the history just fine, you are the one contradicting yourself.

bob2356   befriend   ignore   Mon, 10 Feb 2014, 12:48am PST   Share   Quote   Like (1)   Dislike (1)     Comment 63

Robert Sproul says

bob2356 says

it's not going to change,

It will change all right.

Like every system before it, it will collapse.

Yes eventually. I don't think it's going to be in my lifetime. Consider my statement suitably modified.

Reality   befriend   ignore   Mon, 10 Feb 2014, 12:50am PST   Share   Quote   Like   Dislike (2)     Comment 64

bob2356 says

Reality says

Do you not know the basic monetary history of the 20th century? here's the brief outline:

I know the history just fine, you are the one contradicting yourself.

There was no contradiction: before 1913, the US$ was on classical gold standard (most of the world's major currencies were on gold standard prior to WWI breaking out in 1914); after 1971, it was pure fiat worldwide. The transition took half a century and many steps.

Reality   befriend   ignore   Mon, 10 Feb 2014, 12:53am PST   Share   Quote   Like   Dislike (1)     Comment 65

bob2356 says

Yes eventually. I don't think it's going to be in my lifetime. Consider my statement suitably modified.

Thanks for the meaningless statement. You could be 100 years old (just like the FED) and die tomorrow, for all we know.

CDon   befriend   ignore   Mon, 10 Feb 2014, 8:29am PST   Share   Quote   Like (2)   Dislike     Comment 66

Reality - to your credit, while you do (basically) have a point about a parent corp not having liability for a subsidiary, for the record, just about every other point of law you tried to make was wrong. Your ideas about jurisdiction are wrong - your points about "Legal Tender Law" are grossly overstated, etc. etc.

The thing that really got me though was this:

Reality says

Contracts in the US, in order to be enforceable, has to be written with the US$ as unit of count (in compensatory clauses if not elsewhere); a unit of count that is entirely controlled by the FED, which automatically becomes a party to every business contract as a result.

No offense, but this is about the biggest bit of nonsense I have ever seen when it comes to (what I can only assume is a laymen) talking about the law. This statement is so nonsensical, it is roughly the equivalent of someone taking their high school biology education and trying to make a medical diagnosis (well if your arm hurts, you clearly have a case of medulla oblongata irritating the Golgi apparatus...)

If you do happen to care, there are a number of chancery courts that still operate in the US, and even in the states that don't have chancery, most circuit courts will grant all sorts of equitable (non-monetary) relief.

But assuming you don't, your ideological point about a lot of people essentially getting away with a lot of stuff (and in that regard - I really am sympathetic) stands. You can make any ideological point you want, but there is no need to make up a bunch of non-sensical legalese in a hamfisted effort to support it.

Mick Russom   befriend   ignore   Mon, 10 Feb 2014, 8:53am PST   Share   Quote   Like (1)   Dislike     Comment 67

Banks are bartenders. They get money when the clients are crying or celebrating. They are evil. Usury was considered vile through most of history, and when the credit cards and house as a credit card mechanism was foisted on the public, the middle class has seen a drastic decline in the standard of living (real and relative).

bob2356   befriend   ignore   Mon, 10 Feb 2014, 11:27pm PST   Share   Quote   Like   Dislike (1)     Comment 68

Reality says

bob2356 says

Yes eventually. I don't think it's going to be in my lifetime. Consider my statement suitably modified.

Thanks for the meaningless statement. You could be 100 years old (just like the FED) and die tomorrow, for all we know.

Bank promissory notes have been around since the 7th century., Banknotes aka paper money backed by gold aka the gold standard started since the late 1600's and lasted roughly 200 to 250 years depending on the country. Fiat money has lasted almost half as long as gold backed money already. What makes you think it's going away so fast? What do you believe it will be replaced by, bitcoins? Shall we go back to a carrying around gold? Back to gold backed money. Why would that improve anything. There were certainly lots of crashes, financial collapses, and currency debasement under the gold standard.

Do you ever have any constructive thoughts about how things might be improved or just complaints about everything?

Blurtman   befriend   ignore   Mon, 10 Feb 2014, 11:41pm PST   Share   Quote   Like   Dislike     Comment 69

Unlimited backstop, said Timmay.

indigenous   befriend   ignore   Tue, 11 Feb 2014, 1:59pm PST   Share   Quote   Like   Dislike     Comment 70

FWIW David Stockman detailed the AIG story in his book .

They are an insurance company which means they are mandated to have high reserves, I think over 100%, of high quality bonds.

10% of their money was involved in the derivatives.

AIG had many arms if one failed it would not effect the other arms.

bob2356   befriend   ignore   Tue, 11 Feb 2014, 4:30pm PST   Share   Quote   Like   Dislike (1)     Comment 71

indigenous says

FWIW David Stockman detailed the AIG story in his book .

They are an insurance company which means they are mandated to have high reserves, I think over 100%, of high quality bonds.

10% of their money was involved in the derivatives.

AIG had many arms if one failed it would not effect the other arms.

I was talking about stockman's book (which I read last summer) among others, especially neil barofski's. Stockman didn't say AIG wouldn't fail, he said AIG would have failed, should have failed, but that paulson and bernake were wrong it wouldn't have been a disaster. The result of AIG failure would have been the failure of Morgan Stanley and Goldman Sachs, the last two standing investment banks, which Stockman very accurately describes as casino operations. I think his exact quote was from his this week on wall street week interview was "AIG was safe to fail". He also details how the commercial banking sector had solid balance sheets and was never in any danger failing. The entire bailout was based on the lie, perpetrated amazingly enough by treasury secretary hank paulson former ceo/major shareholder of the about to become extinct goldman sachs, that the commercial banking sector was in trouble along with investment banking. Gee I wonder why good old hank was so anxious for a bailout? Must have been selfless concern for the american public. ya think?

FWIW stockman's book is 700 pages of trying to distance himself from the train wreck he was instrumental in creating. Stockman was in the ideal position to act on his beliefs, but instead went along with and promoted many of the policies that he now spends all his time critisizing.

indigenous   befriend   ignore   Tue, 11 Feb 2014, 11:33pm PST   Share   Quote   Like   Dislike     Comment 72

bob2356 says

Stockman didn't say AIG wouldn't fail, he said AIG would have failed, should have failed, but that paulson and bernake were wrong it wouldn't have been a disaster.

Go back and read page 6 of Stockman's book where he states what I quoted above. The many arms is stated somewhere else but it is in the book and it is common sense as all large companies are organized this way. He also talks about the assets could have easily been ring fenced.

Yup GS and MS would have failed as it should be.

bob2356 says

He also details how the commercial banking sector had solid balance sheets and was never in any danger failing.

From what I recall there were 12 banks that had 20 trillion dollars in assets with only 80 billion in exposure. So no they were not any danger.

bob2356 says

Gee I wonder why good old hank was so anxi