More Bankster Lies
Let’s talk Archegos Capital today. Or at least the remnants of what used to be Archegos.
Actually, I want to talk something lurking in the background all thanks to the demise of Archegos and yet isn’t being reported very widely, if at all.
I found an interesting piece at Wall Street on Parade, titled, “JPMorgan’s Federally-Insured Bank Holds $2.65 Trillion in Stock Derivatives; How Did It Avoid the Archegos Blowup”, published on April 5, 2021. (1)
While I think it’s important to uncover how a bankster institution can be so intertwined in the same markets as a blown-up hedge fund and yet seemingly escape unscathed, unlike other bankster establishments, I find much more intriguing the even more shadowy matters lurking even further beyond the surface.
Because I think it’s those phantoms which need to be unearthed as they exist even in the face of regulations, regulations sold to the general public as necessary to eradicate such financial demons.
Firstly, allow me to expose some numbers, as brought forth by the article and sourced from the Office of the Comptroller of the Currency, or the OCC.
Let’s start with this one:
“…JPMorgan Chase’s federally insured bank had exposure to $2.65 trillion in notional equity (stock) derivatives as of December 31, 2020.”
Wait. Weren’t we told that the Financial Crisis of 2007-2009 was the result of reckless betting on derivative contracts?
And this is only one bank! So, let’s look at the overall equity derivatives market. “…JPMorgan Chase’s equity derivative contracts represent 63 percent of the total $4.197 trillion of equity derivative contracts held by all federally insured banks and savings associations in the United States. To put it another way, there were 5,033 federally insured banks and savings associations in the United States as of September 30, 2020…”
Let’s get that to sink in, for a moment. One bank out of 5,033 in the US holds 63% of the total equity derivatives market today. Remember that when you’re told about “too big to fail” banks. And don’t forget that when more and more regulations are force fed down your throat, all in the name of keeping you safe and secure.
But hold that force feeding image in your mind, for a moment. I’ll come back to it.
First, some more shocking perspective.
Of the $2.65 trillion that JPMorgan Chase holds, 72% of the contracts are OTC. What does that mean? Simply that no one, except those deeply involved in the contracts, knows any terms of the contracts. For example, who are the counterparties taking the other side of the contract? Are those counterparties levered up as well to take up that counter position? In other words, what are the systematic risks in play here?
Again, let’s recall all that hidden systematic risk in the early 2000’s, which lead to the Wall Street earthquakes of 2007-2009. Of course, at that time, we had a newly elected president, Mr. Barack Obama, who came galloping into the spectacle, bringing forth his promises of a better day with sweeping regulations and changes to make sure this doesn’t happen again, while the vast majority were merely fawning over the new president elected on his promises of change. Don’t forget his 2008 presidential slogan – “Change We Need.”
OK, and did anything change for the better on Wall Street? That’s a matter of perspective, to be sure, but let’s see what the article dug up:
“As to just how effectively the Obama-era Dodd-Frank financial reform legislation of 2010 actually reined in risk on Wall Street, the following statistic offers significant insight…at the height of the financial crisis in the fourth quarter of 2008, equity derivative contracts held by federally insured banks totaled $2.2 trillion, versus $4.197 trillion today.”
Did you catch that? Bring back that forced feeding image. You’re going to need it here as I highlight that JPMorgan Chase’s equity derivative contracts exposure today is larger than the entire equity derivative market in the final quarter of 2008, as the globe’s financial foundations were shaking at the core.
Not only that but in an era of the Dodd-Frank Act, supposedly meant to curb Wall Street excess, the total derivatives market nearly doubled, growing from $2.2 trillion to $4.197 trillion? How is that helping the situation?
Wall Street on Parade reminds us that JPMorgan Chase has accrued “five felony counts over the past seven years for its wild risk appetite”.
And yet, the financial industrial complex just keeps growing bigger and stronger, all in spite of regulations sold as meant to curb the risks and dangers. In the meantime, the Wall Streeters get richer while the rest of humanity struggles to make ends meet.
Yup, thank goodness for regulations like Dodd-Frank…
The evidence just keeps piling up and yet so does the ignorance, all to our own detriment. I’ve said it before and I’ll keep saying it until I’m blue in the face – Banksters do not give a rip about your wellbeing. They will sell their own mothers if it helps them grow their wealth, power and influence so why do you think they would care about you?
So, today’s solution is simple – Stop Listening To The Banksters! Let’s not model ourselves after them. They live pathetic and disgusting lives not worth replicating. Instead, recognize the damage they’re doing to your own life and well-being and thence stay clear of their BS platitudes of helping you. Find those good souls out there working and bringing value to families trying to eek out and grow their own wealth. They’re out there.
Consider that I am a ranting Recovering Bankster. What do I know? I think I know a thing or two about what’s shaking.