tag:blogger.com,1999:blog-7982981413278241287.post3410425564136591100..comments2023-10-28T17:54:39.467-06:00Comments on The Golden Truth: JP Morgan Earnings? Nothing Is But What Is Not...Dave in Denverhttp://www.blogger.com/profile/03016238915167131989noreply@blogger.comBlogger8125tag:blogger.com,1999:blog-7982981413278241287.post-26100175642166232122011-04-14T10:54:02.806-06:002011-04-14T10:54:02.806-06:00LOL. The shallowness that has occurred here is ba...LOL. The shallowness that has occurred here is based on a shallow reading of what I said. Please re-read carefully my commentary because I explicitly state that big banks have been changing and liberalizing the "assumptions" used to calculate "loss expectations" in order to boost GAAP earnings. That doesnt even requre the accounting you learn in the high level course at University of Chicago that I nearly aced in order to understand that. Thats accounting 101. BAnks are stretching out default classification time periods and they are even overlooking large chunks of mortgage and credit card accounts that have stopped making payments for many months. That is why you hear stories of people going a year w/out making a mortgage payment before they get a letter from their bank/servicer. As long as the bank does not send out that letter, an account is not classified at "delinquent" or "in default." Pretty basic stuff, bro.<br /><br />And I just looked at one small section of JPM's earnings report because I just don't have time to do a really thorough job. JPM, like all other big banks, is thoroughly insolvent. They are partially being funded by the $1+ trillion they are keeping in "excess reserves" at the Fed, which the Fed pays interest on to the banks. You know where that money came from? That's largely our tax money.<br /><br />If I had the time to do a really thorough job on going thru JPM's numbers and all of the publicly available docs plus some face to face conversations with the controller there, I bet I could PROVE that JPM is insolvent AND that if the GAAP acctng standards used 30 years ago were still used today that JPM would have filed a very big loss this quarter.<br /><br />Those are the facts.Dave in Denverhttps://www.blogger.com/profile/03016238915167131989noreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-42659042301829428792011-04-14T10:34:05.400-06:002011-04-14T10:34:05.400-06:00Dave from Denver made provocative statements based...Dave from Denver made provocative statements based on shallow analysis.<br />It is a fact that JPM booked $2.6bln to income by reducing loss reserves. Every single investor will understand this. Maybe it was a revelation to Dave? $2bln of that came from credit card receivables. For every card company, credit losses are falling faster than expected. Not just at JPM. It makes sense. In the past two years, not too many bad credits received a new credit card. Those that still have a card, are still paying their balances. This means credit losses fall. Accounting rules require reserves to reflect loss expectations. There is really no sinister mystery here.<br />As for mortgages, yes, it is a mess. Losses will continue. This is no surprise either. Look at what the company has been saying. <br />The big commodities short at JPM? What a joke. THey just booked a huge quarter in proprietary trading. Where is the loss from the big silver short? There is none. I'm not saying buy or sell JPM, but do not misinterpret the facts.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-8790510826380898482011-04-14T08:26:05.059-06:002011-04-14T08:26:05.059-06:00Dave,
What's your "n"?..lol
Jim G...Dave,<br /><br />What's your "n"?..lol<br /><br /><br />Jim Grant - US Will Resolve Debt by Returning to Gold Standard<br /> <br /><br /><br />When asked about gold specifically Grant stated, “To me the gold price takes the form of a very uncomplicated formula, and all you have to do is divide one by ‘n.’ And ‘n’, I’m glad you ask, ‘n’ is the world’s trust in the institution of paper money and in the capacity of people like Ben Bernanke to manage it. So the smaller ‘n’, the bigger the price. One divided by a receding number is the definition of a bull market. <br /><br /><br />http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/4/14_Jim_Grant_-_US_Will_Resolve_Debt_by_Returning_to_Gold_Standard.htmlAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-71440526201135908962011-04-14T07:37:32.167-06:002011-04-14T07:37:32.167-06:004/14/2011 8:49 AM EDT
I am not sure what spin the ...4/14/2011 8:49 AM EDT<br />I am not sure what spin the talking heads will put on t but that's an ugly unemployment number. The headline increase of 27,000 is bad enough. The actual number of more than 89,000 new claims is simply terrible. According to the release there are more than 8 million people claiming benefits under one of the basic or extended benefit programs. People keep talking about signs of a firming job market but we still have a huge number of people out of work and seemingly unable to find jobs right now. I was hoping for a much better number that showed some real sign of improvement in the jobs situation.mabmannoreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-84162290740899775752011-04-14T06:19:13.350-06:002011-04-14T06:19:13.350-06:00Dave,
What percentage of our economy do you think ...Dave,<br />What percentage of our economy do you think is based on overly generous assumptions regarding asset values ie. for rollover of debt and collateralization?<br />How much wealth is based on these conjured up values?<br />Do you expect anyone to really tell the truth?<br /><br />The thing that gets me is people want less regulation which to me means less enforcement and that puts most rule followers at extreme disadvantage...<br /><br />See...<br /><br />In Financial Crisis, No Prosecutions of Top Figures<br /><br /><br />Prosecutors also could pursue evidence that executives knowingly awarded bonuses to themselves and colleagues based on overly optimistic valuations of mortgage assets — in effect, creating illusory profits that were wiped out by subsequent losses on the same assets. And they might also investigate whether executives cashed in shares based on inside information, or misled regulators and their own boards about looming problems. <br /><br />“If you look at the last couple of years and say, ‘This is the big-ticket prosecution that came out of the crisis,’ you realize we haven’t gotten very much,” said David A. Skeel, a law professor at the University of Pennsylvania. “It’s consistent with what many people were worried about during the crisis, that different rules would be applied to different players. It goes to the whole perception that Wall Street was taken care of, and Main Street was not.” <br />“When regulators don’t believe in regulation and don’t get what is going on at the companies they oversee, there can be no major white-collar crime prosecutions,” said Henry N. Pontell, professor of criminology, law and society in the School of Social Ecology at the University of California, Irvine. “If they don’t understand what we call collective embezzlement, where people are literally looting their own firms, then it’s impossible to bring cases.” <br /><br /><br />http://www.nytimes.com/2011/04/14/business/14prosecute.htmlAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-87603194975241414282011-04-13T16:57:21.654-06:002011-04-13T16:57:21.654-06:00All the banks have gone to this well so many times...All the banks have gone to this well so many times it is now running dry. 1.2 billion in loss reserves cannot go much lower me thinks.EconomicDisconnecthttps://www.blogger.com/profile/02802078645713106743noreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-74158459317834903492011-04-13T15:00:13.705-06:002011-04-13T15:00:13.705-06:00"...One more little statistic that will never..."...One more little statistic that will never be reported in the press or analyzed by your financial advisor or retirement fund money manager is the percentage of non-performing loans as a percent of the total amount of outstanding loans plus deriviatives..."<br /><br />You might be interested in looking at a satirical video on the mainstream media called:<br /><br />“People Are Nuts” <br />http://www.youtube.com/watch?v=aFA0BqbJIDcmbridgeshttps://www.blogger.com/profile/03880061579076605190noreply@blogger.comtag:blogger.com,1999:blog-7982981413278241287.post-69395274770417681732011-04-13T13:26:14.699-06:002011-04-13T13:26:14.699-06:00Fantastic stuff Dave.
BillFantastic stuff Dave.<br /><br />BillBillnoreply@blogger.com