2008 Financial Crisis Analysis

Jp Morgan has done a few negative things such as being accused of suppressing the economy when things were good. Another is that during the US economy crisis, Morgan put together group of investors that unwrote a $62 million bond that was issued to the US government, it saved the economy but during the process JP Morgan and his investors made a good amount of profit causing them to become unpopular. Morgan faced criticism that he had too much power and was accused of manipulating the nation’s financial system. Morgan has also paid a president to take over Roosevelt's place although the president died so therefore Roosevelt had to become the president by default.

In 2008, the world experienced a tremendous financial crisis which rooted from the U.S housing market; moreover, it is considered by many economists as one of the worst recession since the Great Depression in 1930s. After posing a huge effect on the U.S economy, the financial crisis expanded to Europe and the rest of the world. It brought governments down, ruined economies, crumble financial corporations and impoverish individual lives. For example, the financial crisis has resulted in the collapse of massive financial institutions such as Fannie Mae, Freddie Mac, Lehman Brother and AIG. These collapses not only influence own countries but also international area. Hence, the intervention of governments by changing and

In the summer of 2012, JPMorgan Chase, the largest leading U.S. bank, announced trading losses from investment decisions made by its Chief Investment Office (CIO) of $5.8 billion. The Securities and Exchange Commission (SEC) was provided falsified first quarter reports that hidden this massive loss.

JPMorgan Chase is amongst the big four banks in the U.S. with Bank of America, CitiGroup, and Wells Fargo. According to Bloomberg, in of October 2011 they surpassed Bank of America as the largest bank by assets. JPMorgan Chase & Co is considered to be a universal bank.

After the financial crisis, the large financial institutions have become heavily regulated. They do not possess the freedom and cannot take on as much risk as they used to in the past. During the summer, I had exposure to large transactions that were successfully executed and saw how some transactions were declined by the bank. I was able to participate in a sale segment of one of

The financial crisis that happened during 2007-09 was considered the worst financial crisis in the world since the great depression in the 1930s. It leads to a series of banking failures and also prolonged recession, which have affected millions of Americans and paralyzed the whole financial system. Although it was happened a long time ago, the side effects are still having implications for the economy now. This has become an enormously common topic among economists, hence it plays an extremely important role in the economy. There are many questions that were asked about the financial crisis, one of the most common question that dragged attention was ’’How did the government (Federal Reserve) contributed to the financial crisis?’’

In recent months, Senator Bernie Sanders has proposed legislation to break up the nation’s biggest banks, including JPMorgan Chase, under Section 121 of the Dodd-Frank Act (Przybyla, 2015). The 2016 presidential candidate has repeatedly stated that he vows to break up the big banks if he gets elected. According to Sanders, “fraud is the business model of Wall Street” (Dywer,

J.P. Morgan was hunting for an opportunity to break into a prime brokerage business to broaden its influence on the market. J.P. Morgan made a well thought through decision to acquire Bear Stearns, knowing that a prime brokerage business is one of its specialties. According to CNNMoney, “200 JPMorgan staffers were working on the deal, assessing the strengths of Bear Stearns' different businesses and its exposure to toxic mortgage securities.” It is apparent that a lot of effort and rigorous research have been invested in the decision making process. On top of that, the Bear Stearns’ offering price came at a great discount as well “to provide cushion to protect J.P. Morgan in turbulent times and would provide the company ‘margin for error.’” As we can see, J.P. Morgan was well familiar with the possible consequences it may face after the acquisition and made the deal the way to protect itself in the future. In its turn, Bank of America purchased Countrywide Financial in 2008 to become “No. 1” in mortgage lending, according to then-chief Kenneth Lewis. By making this acquisition the bank achieved its goal and became “the nation's largest mortgage lender and loan servicer.” Similarly to J.P. Morgan we can see that the bank had its incentives and executives clearly understood the pitfalls of the deal.

JPMorgan Chase & Co. is one of the most leading financial service firm and banking industry in the United States and worldwide. The firm was founded in 2000 on merger between Chase Manhattan Corporation and JPMorgan & Co. Based on the Forbes report JPMorgan Chase & Co is the world's sixth largest public company based upon the companies operational assets. The hedge fund unit of JPMorgan Chase is the 2nd largest hedge fund in the United States.

JP Morgan is the largest bank in the US with over $2.5 trillion in assets. The bank made it known via an SEC 8-K filing that the breach affected 76 million households and 7 million small businesses. They confirmed that contact information of customers was compromised in the breach including name, address, phone number and email addresses. They indicated that internal JP Morgan information pertaining to customers such as credit cards and various investment products, was also accessed by parties

Banks have been at the forefront of the financial system for as long as they have existed and have captured the attention of stakeholders on both controversial grounds as well as being undisputed with regards to the many helpful services they provide. JP Morgan & Chase is one such bank, surrounded by hostile news articles and excessive scrutiny but rightfully so as it has of recent been the topic of much controversy as turning a blind eye to the moral codes established by the Securities and Exchange Commission (SEC) and assisting Ponzi Scheme masterminds in swindling unsuspecting investors.

Extensive research has determined that the banking industry is in an unstable state. The industry’s profits have

In 2008, the US experienced the traumatic chaos of a financial downturn, whose effects rippled throughout Europe and Asia. Many economists consider it the worst crisis since the Great Depression, and its alarming results are still seen today, a long six years later. Truly, the recession’s daunting size and formidable wake have left no one untouched and can only beg the question: could it have been prevented? The causes are manifold, but can be found substantially rooted in illogical investments and greedy schemes.

The move came after Bear Stearns was bleeding cash after word spread about the company’s crumbling position. European banks and other brokerage clients were pulling their investments and loans with Bear Stearns rapidly—and the company was losing billions in a week. In a swift move, the CEO of Bear Stearns, Alan Schwartz, was connected with the FED Chairman Ben Bernake, who agreed to loan money to JPMorgan if the financier company took over the quickly deteriorating Bear Stearns. It is argued that the FED was right in doing so as this move not save one of the largest American investment banks thus preventing a crushing blow to the US economy.

This chapter is about the background of 2007-2008 financial crisis. The 2007-2008 financial crisis has a huge impact on US banking system and how the banks operate and how they are regulated after the financial turmoil. This financial crisis started with difficulty of rolling over asset backed commercial papers in the summer of 2007 due to uncertainty on the liquidity of mortgage backed securities and questions about the soundness of banks and non-bank financial institutes when interest rate continued to go up at a faster pace since 2004. In March 2008 the second wave of liquidity loss occurred after US government decided to bailout Bear Stearns and some commercial banks, then other financial institutions took it as a warning of financial difficulty of their peers. In the meantime banks started hoarding cash and reserve instead of lending out to fellow banks and corporations. The third wave of credit crunch which eventually brought down US financial system and spread over the globe was Lehman Brother’s bankruptcy in August 2008. Many major commercial banks in US held structured products and commercial papers of Lehman Brother, as a result, they suffered a great loss as Lehman Brother went into insolvency. This panic of bank insolvency caused loss of liquidity in both commercial paper market and inter-bank market. Still banks were reluctant to turn to US government or Federal Reserve as this kind of action might indicate delicacy of