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Saturday, October 26, 2013

US financial TV journalists shocked that top US bank is paying $13bn fine

The Week magazine says Wednesday night's popular US 'Daily Show' hosted by Jon Stewart focused on JPMorgan Chase, which agreed to a $13bn fine by the US government for selling dodgy mortgage-backed securities in the run-up to the 2008 financial crisis.

In 2008, the bank had acquired Bear Stearns, a failing investment bank, and Seattle based Washington Mutual, a home loans operation, with the cooperation of US regulators.

To Jon Stewart, and most of the financial press, JPMorgan's tentative settlement with the Justice Department and New York State is "a mutually negotiated compensatory agreement for outstanding liabilities related to some shady business dealings," as Stewart put it.

Stewart suggested that the talking heads on CNBC and Fox Business News should be equally pleased that somebody is finally facing some consequences for helping cause the Great Recession. Nope. To Jim Cramer, Maria Bartiromo, Charlie Gasparino, and the other stars of financial TV news, he noted, the $13bn fine is "a shakedown witch-hunt scalping jihad!" And Stewart has the video evidence to prove it.

As for JPM, an analysis by the NYT says Bear Stearns and Washington Mutual may have contributed $16bn in net income since the end of 2008.

Besides, the assets were deeply discounted when consolidated in JPM’s accounts.

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