It would seem the London Office of Morgan is where the losses were authorized and there are statements about Morgan moving their operations there.
What also came out is other financial institutions use the Cayman Islands for their investment banks.
But, there is something more Rep. Lynch was interested in. He learned the FDIC was exposed to liability in the losses from Morgan. If the losses exceeded Morgans capacity to handle the losses the coverage from the FDIC would have covered the losses and the American Taxpayer would be on the hook for this disaster all over again.
While the iconic label to the right is frequently seen by depositors in a bank the color needs to be changed. Evidently, Jamie Dimon is under the impression the FDIC is actually as solid as an investment in the gold market.
The Dodd-Frank Laws and the Volcker Rule cannot be overlooked as significant law which has to be upheld to protect the American citizen from exploitation of banks that sincerely don't care about them. The Republicans seek to weaken these laws exposing the American citizen to liability even today and are very wrong to proceed down that path.
Morgan is going to provide more information to shareholders on July 13th. The losses started the end of March. The realization of the sincere problems weren't realized until the end of April. In order to find the problems with the portfolio experts were called in to consult Morgan.
I am glad Mr. Dimon has confidence in his company. Rightfully so. However, the company is huge, its assets nearly undiscernible to decide the protections available to this company. This was somewhat of a sneeze to Morgan, but, that is not the case across the board and Rep. Valezquaz pointed out the losses put an entire smaller bank out of business.
I have been impressed with the Democratic Representatives on the House Committee, including Rep. Maxine Waters who was visibly shaken by the testimony of Mr. Dimon. It is safe to say this is a huge dynamic few understand enough to adequately provide sovereign governments with a safety margin enjoyed by Morgan of their shareholders THIS TIME. Morgan nearly didn't catch it this time without outside help. Follow?
Morgan is without a doubt the largest, successful investment/bank in the world. Even it was unsuccessful in finding the danger to its structure within its own talent and infrastructure. This is a dynamic that plays with the fringes/margins of the financial global network. When he gives testimony he speaks in terms of global markets, not simple errors or oversights. I am sure Morgan learned a great deal they are not obligated to share about the dynamics of their losses and how the markets react. I don't know whom is better to have the information. That information will be invaluable, however, that doesn't mean the citizens of any nation should have this level of exposure to the risk these companies now enjoy.
The laws have to regulate this, they have to be strong enough to prevent speculation to this extent in markets because there are huge levels of uncertainty that experts seek to understand. That won't change. There is no new knowledge that can control the entire world. There are too many variables at any given time. The laws have to protect the citizens and the futures including their entitlements. When Morgan is confident they are safe from bankruptcy that means they can cover their losses 'in house,' but, it doesn't mean the Social Security Trust Fund will be intact if the USA bonds it relies on goes bad in the process.
All the regulatory laws since the first depression and its recovery affiliated with FDR need to be reviewed and incorporated into the laws of Dodd-Frank and Volker to stop this hideous exposure to sovereign nations. That is all that can be done here. The oversight of the US Government is to protect the people and cut loose those companies intent on risk and not investment.
Morgan can go about their business, but, the USA cannot continue to stand by and allow these companies to grow risk that is impossible to predict and control.
