JP Morgan Chase Catastrophe

744 Words3 Pages
In the year of 2007, the Great Recession began. It all started at the bustling Wall Street. It was a pandemic that brought dilemma to the businesses, to the employees and to the elated new home owners. JP Morgan Chase was one of the major banks participated in falsifying the mortgage loans, and they suffered consequences for what they did. The mortgage loans gave temporary joy but longtime misery to home buyers. The federal government filed a lawsuit, and it reached a settlement. The tragedy resulted to Global and Financial reforms. The mortgage loans were used in risky businesses. Back in 2008, James Dimon, the head of JPMorgan Chase, disclosed mortgage underwriting was terrible. Mortgage loans are assets that were exploited to make up collateralized debt obligations. They were also destructively utilized in investing of the banks. The mortgages seemed improved, and they were swiftly sold because the bank attuned the critical assessments when an outside analysis exposed intense defects with thousands of home loans. In consequence, millions of Americans were unable to put their homes on market because they had lost so much worth as the housing market dropped. Gretchen Morgenson, writer from NY Times, dubbed the loans as "poisonous.” Due to the bank malpractices, they faced criticisms. From 2005 to 2008, the bank confessed to a statement of facts that figured how it crashed to totally unveil the hazards of buying uncertain mortgage securities. In March 2013,
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