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JPMorgan Chase Spends $500 Million On a Data Center

samzenpus posted about 2 years ago | from the first-class-center dept.

Hardware 275

1sockchuck writes "JPMorgan Chase spends $500 million to build a data center, according to CEO Jamie Dimon. That figure places the firm's facilities among the most expensive in the industry, on a par with investments by Google and Microsoft in their largest data centers. Dimon discussed the firm's IT spending in an interview in which he asserts that huge data centers are among the advantages of ginormous banks. Dimon also offered a vigorous defense of the U.S. banking industry. 'Most bankers are decent, honorable people,' Dimon says. 'We're wrapped up in all this crap right now. We made a mistake. We're sorry. It doesn't detract from all the good things we've done. I am not responsible for the financial crisis.'"

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We're Sorry... (5, Funny)

Anonymous Coward | about 2 years ago | (#40977997)

Ya... they're sorry; sorry all the way to the bank!

Wait...

Re:We're Sorry... (-1)

Anonymous Coward | about 2 years ago | (#40978115)

I'm going to take you to the bank. The blood bank.

Huh. (1)

dyingtolive (1393037) | about 2 years ago | (#40978001)

How much does JPM still owe the US Government?

Re:Huh. (3, Informative)

Sarten-X (1102295) | about 2 years ago | (#40978113)

Apart from the normal everyday fractional-reserve loans from the Federal Reserve Bank, JPMorgan probably owes close to $0. I'm assuming you were referring to the $25 billion in bailout money, which was apparently paid in full [propublica.org] .

Re:Huh. (5, Interesting)

cpu6502 (1960974) | about 2 years ago | (#40978445)

Yeah ProPublica is wrong. It's called an accounting trick. Borrow money from the government in loan #2, and then pay back the government on loan #1 (TARP). General Motors pulled the same schenanigans when it claimed to "pay back" the loans, but in fact is still deep in debt to the government.

It's reminiscient to how a certain president (I'll let you guess) claimed to "put 100,000 more cops on the street". In reality the law said 100,000 cops or 100,000 cop-equivalents... like new computers. Most departments spent the money on computers and only hired an additional ~500 actual cops.

When you listen to a politician or CEO or marketer you have to realize they are not lying to you. Instead they are redefining words on the fly (a "cop" is not really a cop... could be a computer), or omitting crucial information (we paid TARP, but we borrowed money to do it).

Re:Huh. (2)

NemosomeN (670035) | about 2 years ago | (#40978745)

In GM's case, yes, it was an accounting trick. In JP Morgan's case, Goldman's Case, and in the case of several other banks, it's not. All of the big banks were forced to take loans from TARP; many of them didn't want to. It's widely believed that JP Morgan was among the banks that did not need or want the loans, and has therefore almost certainly paid them all back.

If you don't believe me, please, prove me wrong. Provide some evidence that JP Morgan still owes the government money, even on gross. (On net, I would be willing to bet they are owed money, due to treasury holdings).

Re:Huh. (1)

khallow (566160) | about 2 years ago | (#40978883)

If you don't believe me, please, prove me wrong.

I'd love to be able to prove your assertions one way or another. But how to do that? This sort of speculation veers on being unfalsifiable.

Re:Huh. (4, Interesting)

timeOday (582209) | about 2 years ago | (#40978937)

Goldman (and JP Morgan?) don't owe the government anything because they were simply gifted enough money to stay afloat, free and clear. This was done by the government paying AIGs debts to Goldman [realclearmarkets.com] , even though they were unregulated, non-FDIC arrangements. In other words, the banking industry set up a scapegoat (AIG) to receive bailouts for it and then die, which it did. So Goldman and the others get their cake ($$$ with 9 zeros) and eat it too (carping about how they never wanted and didn't need TARP).

Re:Huh. (3, Funny)

Sarten-X (1102295) | about 2 years ago | (#40978849)

[citation needed]

Specifically, I'm wondering which government program (or anybody else, for that matter) provided the funds for loan #2? I doubt it'd be the Federal Reserve Bank, which wouldn't lend out that much money in the first place (hence necessitating the bailouts) without more cash being in the JPM's reserves.

In fact, JPM's corporate debt is at its lowest since the bailout [ycharts.com] , regardless of the source.

That's okay... you can feel free to keep ranting about politics if it makes you feel better.

Re:Huh. (1)

glodime (1015179) | about 2 years ago | (#40978915)

Would you care to cite any sources for this info on TARP being paid back by additional loans from the government?

Re:Huh. (0)

Anonymous Coward | about 2 years ago | (#40978507)

what about the low interest rate JP got when they got tarp money ?
you could argue that JP was one of hte few big banks that didn't want the tarp money (as I understand the story, giethner or paulson called 10 or 12 CEOs to washington and said, you are all taking the loans; no if ands or buts)
you could also argue that the taxpyers lost a lot because tehy didn't charge the banks the normal risk premium that a private lender would have charged...
do you have an opinion ?

Re:Huh. (4, Interesting)

NemosomeN (670035) | about 2 years ago | (#40978985)

They got a fair interest rate. They borrowed $25B, and paid it back 7 months and 20 days later. The revenue to the government was $1.7 B.

It was preferred stock with a 5% dividend, with warrants attached. This basically means the banks sold stock to the government with a required, 5% dividend. The government also received warrants, which allow them to purchase additional common stock at a predetermined price (These warrants were dilutive, that is, existing shareholders pay for the government's profit when they are exercised). The banks "repaid" the loans by buying back the preferred stock. The government was then left with the ability to buy shares of the banks at a discount if their stock performed well (If the share price was greater than the exercise price of the warrants, the government would purchase the shares at a discount).

TARP was certainly not a sweetheart deal. Bernanke and Paulson (Not Geithner) sat in a room and basically said they were going to offer the banks the loans, but it was all or nothing. If anyone refused to take the loans, no banks would be able to borrow. Any bank that had refused would have gone down in history as "The bank that vetoed the bailout." Payback was also forcibly delayed. The idea was that if half of the banks took loans and half didn't, the market would panic, selling the banks that took loans and buying the banks that didn't. This would have caused the bailout to fail immediately, and, in fact, have the opposite of the desired effect.

I guess to answer your question; yes, I have an opinion.

Re:Huh. (-1)

Anonymous Coward | about 2 years ago | (#40978509)

Good for them.

What makes me happy is that they are backing Romney for a win.

http://content.usatoday.com/communities/onpolitics/post/2012/05/jp-morgan-chase-campaign-donations-obama-romney-/1

"Presumptive GOP presidential nominee Mitt Romney has received $373,650 in campaign donations from JPMorgan employees[...] By comparison, President Obama has received $76,675 in campaign donations from the company's employees."

Ha HA ha ha HA ha Ha HAHAHAHA! Obama drones beware: You have no chance to survive make your time!

Re:Huh. (1)

Anonymous Coward | about 2 years ago | (#40978675)

That's great. So, all I need to remember is that if anything goes wrong at JPMorgan and a cascade of other banks that hold up the economy, I just have to keep a few hundred billion in taxpayer money around to cover them if their gambling bets go bad, and they'll be nice enough to pay me whatever the going rate is. Never mind that in the interim, while they are getting their balance sheets back in order and making profits again, millions of people will be thrown out of work and be struggling to survive economically for multiple years after those risky bets go sour, costing individual people a lot more money than what ever went out from the government. I'll continue to provide the backing for this huge, high-stakes, highly-profitable Wall Street gambling consortium, and in return I'll just take a modest cut if and when things go bad.

Yeah, sign me up for that deal.

I'll be impressed when the banks can tell me with confidence that I'll never have to cover their bets again, under penalty of law that will result in confiscation of their entire business if they don't. Either that, or I at least expect much higher than prime interest rate of return for my investment -- preferably paid in advance every year as a cost of doing business as "financial hazard insurance". They want that service from the taxpayer? Pay up. We sure as hell do for any service we request from the banks, including accessing our own money.

Paying us back is great, but it doesn't change the fact that we were and still are being played for suckers by socializing the risks and letting them privatize the profits.

Re:Huh. (0)

Anonymous Coward | about 2 years ago | (#40978977)

It's not exactly "taxpayer money".

Its probably in the form of bonds, that is, the money are more or less conjured out of thin air.
However, its not 'free', the USD gets weaker, ie you can buy less for your money, and inflation increases.

The bonds may be "sterilized"- restricted in the ways the bank can use the money, in order to limit the effects on inflation,
but its still not free...

Re:Huh. (1)

Anonymous Coward | about 2 years ago | (#40978393)

JPMC repaid TARP funds around June 17, 2009. http://dealbook.nytimes.com/2009/06/17/jpmorgan-repays-treasury-as-tarp-exits-continue/

June 17, 2009 -- JPMorgan Chase & Co. (NYSE: JPM) announced today that it repaid in full the $25 billion preferred stock investment it accepted through the Troubled Asset Relief Program (TARP). In addition to this principal amount, JPMorgan Chase has paid the U. S. Treasury an aggregate of $795,138,889 in dividends on the preferred stock, including dividends that had accrued through the redemption date. The company will also notify the U.S. Treasury today of its intent to repurchase the 10-year warrant issued to the Treasury in connection with the preferred investment.

Line Item (5, Insightful)

Galactic Dominator (944134) | about 2 years ago | (#40978029)

It doesn't detract from all the good things we've done.

Can I get a line item listing of these "good things"?

Re:Line Item (2)

jhoegl (638955) | about 2 years ago | (#40978191)

1)Gave loans to people
a)people who couldnt afford them
a1.)When the bottom falls out, we will own them.
1a1.)

Re:Line Item (2, Informative)

Anonymous Coward | about 2 years ago | (#40978433)

Holy shit you're a brainwashed idiot.

1) Nobody makes money making sub-prime loans. It's trivial for any idiot to understand that loaning money to people who can't pay it back is a dumb idea.
2) The only reason anyone did offer sub-prime loans was because either a) they knew they could sell it to the government (Fannie and Freddie) for a profit, or b) they were forced to by the Fed's regulations requiring a certain percentage of all loans be high risk loans to poor people who were buying houses far bigger than they could afford.
3) Most of those loans were initially offered by the thousands upon thousands of real estate loan companies that sprung into existance due to the artificial market created by the Fed, not by the huge banks you've been brainwashed into hating. If you're old enough you will remember when there was a home loan business on every damn corner in every town and city.
4) The banks that still held sub-prime loans when the market crashed lost their pants. Yeah they may have owned a lot of people's houses, but those houses were worth a whole lot less than the money still owed on the loan, so how is it a good thing from any bank's point of view to "own" someone?

Re:Line Item (1)

kraut (2788) | about 2 years ago | (#40978521)

My goodness, well informed, well reasoned posting from an AC. That I lived to see this day!

Spot on!

Re:Line Item (4, Insightful)

jhoegl (638955) | about 2 years ago | (#40978537)

1) Then why did so many get sub-prime loans, ending up in people still losing houses today because their payments have continuously gone up? Risk.... none to bank, all on person.
2) So then with this argument you just refuted your previous one... GG there AC... GG
3) How did the Fed create an artificial market when the market was based on supply/demand? Demand went up because people were buying houses, people were buying houses due to sub-prime loan offers not understanding the full implications
4) Yes they did, but they were thinking about the people paying them more, not walking away from the house or bankrupting themselves. The banks actually won out because they are still owed that money by the initial person, they resold the house at auction, and they can get in on the auction loans.
So yes... they do own these people for the rest of their lives or until they pay it off. Wasnt it once said, discover a way for people to keep paying you and you will be rich?
Guess what...
Oh and dont come on here all AC and spout your gibberish.

Re:Line Item (2)

khallow (566160) | about 2 years ago | (#40978823)

Risk.... none to bank, all on person.

And how is the bank going to make a profit when the loan is underwater? The best that the bank can do in that situation is to recover the loan principle. They can't keep the extra beyond that.

Yes they did, but they were thinking about the people paying them more, not walking away from the house or bankrupting themselves.

Well, there's the risk right there. When those people walk away from the house, go bankrupt, or successfully contest the bank's ownership of the loan, that all becomes losses for the bank.

Re:Line Item (3, Informative)

Anonymous Coward | about 2 years ago | (#40978927)

"And how is the bank going to make a profit when the loan is underwater? The best that the bank can do in that situation is to recover the loan principle."

Or never hold the loan in the first place. Mortgage-backed securities = The method by which known bad loans can be packaged up and sold off on the open market to investors, who are told what a great value they are.

Banks generally don't hold loans anymore. They hold servicing rights, which is the money skimmed off you every month when you make a mortgage payment. It's a transaction fee, nothing more. The loans themselves are held by institutional investors.

Summary: Loan brokers originated crappy loans they knew would default, and got their commission for doing so. Banks packaged the crappy ones into nice packages and called them "Awesome Investment Super Duper Grade" which were then sold to the duped investors. Risks to banks - zero. Until the entire financial market began to collapse. Oops.

Corporate karma. Too bad we spared them nearly all of the pain they had rightfully coming.

Re:Line Item (0)

Anonymous Coward | about 2 years ago | (#40978779)

Nobody makes money making sub-prime loans.

If you can't make the regular payments they accept body parts instead.

Re:Line Item (0)

Anonymous Coward | about 2 years ago | (#40978911)

In regards to 2):

If you're referring to the CRA, which is what most idiots who make statements like this do, then you are absolutely wrong and don't understand what the CRA did.

Re:Line Item (2)

glodime (1015179) | about 2 years ago | (#40978931)

1) Nobody makes money making sub-prime loans. It's trivial for any idiot to understand that loaning money to people who can't pay it back is a dumb idea.

I don't think you know what subprime lending is.

Re:Line Item (5, Informative)

rtb61 (674572) | about 2 years ago | (#40978957)

Corporate executives on ludicrous bonus schemes make shit loads of money on loans destined to fail, in fact that was the whole problem. Immediate bonuses being paid all the way up and down the corporate executive line for shit loans, all schemed from the top down by psychopaths, who didn't care how much money their company lost, as they were all in a cosy conspiratorial relationship to protect each other from outside view.

Thanks to the whole principle of disposable labour, you now have disposable companies. At the highest levels it's all about squeezing out the maximum amount of money out of companies. From dirty off-shore off-balance sheet transactions, that while allowing the companies to cheat on taxes also allow those corporate executives to play all sorts of games with those funds, to cross company conspiratorial schemes to push around funds for no other reasons other than running up executive bonuses.

Pay close attention. It's not really companies corrupting the politics any more, it's corporate executives using company funds to corrupt politicians and government agencies, getting legislation rewritten not so much to benefit corporations but more targeted at generating more income for corporate executives regardless of the consequences for companies. Psychopaths in suits, they are every where at the top executive level.

Re:Line Item (4, Insightful)

timeOday (582209) | about 2 years ago | (#40979067)

1) Nobody makes money making sub-prime loans. It's trivial for any idiot to understand that loaning money to people who can't pay it back is a dumb idea.

False! Extending a loan (or owning a mortgage-backed security) to anybody is a great idea so long as I get my commission (or sell it at a markup) and no longer own it when it goes kaboom.

In your imagination, the only party willing to buy those bad loans was the government. In truth, most everybody bought them. Partially this is because the ratings agencies gave these mortgage-backed securities the highest ratings. But the notion this was a wholly government-created situation is just libertarian wishful thinking. Nations in which banks were deregulated the most did worst (see also Ireland), and those where time-tested regulations were preserved did best (see Canada - where average net worth [usnews.com] is now higher than in the US).

Re:Line Item (0)

Anonymous Coward | about 2 years ago | (#40979107)

1) Nobody makes money making sub-prime loans. Well, you do if you bundle the loan with a bunch of good loans to hide the risk and sell the lot at an asking price higher than what the aggregate risk would merit. In case you haven't been paying attention, that's what happened.

Re:Line Item (1)

cvtan (752695) | about 2 years ago | (#40978577)

They haven't had you killed...Yet.

Re:Line Item (1)

Capt. Skinny (969540) | about 2 years ago | (#40978713)

How many new substantial business ventures do you think got off the ground or went public in the last several decades without a loan? I'm talking about those large enough to have a national or even regional impact. Many businesses that provide the products we now use in our daily lives and the profits we have in our retirement portfolios simply wouldn't exist without bankers extending the loans. Whether the bankers benefit themselves or not is irrelevant (I can anticipate someone making the point that they were motivated by their own profit) -- the point is that these successful businesses are considered "good things" by a large segment of the population.

Re:Line Item (3, Insightful)

khallow (566160) | about 2 years ago | (#40978853)

How many new substantial business ventures do you think got off the ground or went public in the last several decades without a loan?

Quite a few. For example, high tech start ups don't bother with loans for the most part. And family investors generally are a lot easier to get, more forgiving, and more generous than bank lenders. Loans really are for businesses that have a stable, predictable business model with decent ROI and a need for a lot of capital.

Re:Line Item (1)

Anonymous Coward | about 2 years ago | (#40979063)

To expand khallow's point: it's VERY HARD for a small company to grow by contracting loans (from a bank or similar), because any loan of a significant amount requires collateral, which most small companies don't have. Small companies grow by attracting INVESTORS, who give money as investment, which is something completely different from a loan.

Re:Line Item (1)

Anonymous Coward | about 2 years ago | (#40978973)

Going AC on this one:

Jamie Dimon is now and has always been a one-note executive. He became the head of JPMorgan Chase as part of the twisted merger with Bank One, in which Bank One was swallowed whole paper, yet ended up exporting a lot of its officer culture and procedures. For example, before the merger, Chase offered a single credit card brand. Bank One offered over 500. The merged bank now still supports over 500. No one is really sure WHY that happened, as JPMorgan Chase was already a much better run organization.

At the time of the merger, Dimon became essentially the President of JPMorgan Chase. When JPMorgan's CEO finally retired a year later, Dimon stepped up as the new CEO. The bank also brought on numerous other questionable practices from Bank One. At Bank One and in more than a few financial circles, Dimon was seen as a golden boy for hauling Bank One out of the fire. His entire corporate philosophy could be summed up as "trim the fat." Unfortunately for him, there really was no fat to trim at JPMorgan Chase. Oddly enough, it's hard to improve on something that's been doing well for over a century. So instead of increased profits, Dimon gave a lot of excuses.

I'm told he's charismatic. I wouldn't know: I had never heard him speak until he was recently brought before Congress. But he has never been a great CEO, and for Chase, not even a good one.

"I am not responsible" (4, Insightful)

TimHunter (174406) | about 2 years ago | (#40978041)

Don't piss on my leg and tell me it's raining.

Re:"I am not responsible" (0)

Anonymous Coward | about 2 years ago | (#40978139)

Don't piss on my leg and tell me it's raining.

Exactly. These assholes are corrupt, and still are. If you could track where that $500 million went, you'd find that a lot of it went into lining executive's pockets, not building a data center.

Re:"I am not responsible" (0)

Anonymous Coward | about 2 years ago | (#40978301)

Don't be silly. I would piss through a colander on your head and then tell you it's raining.

Re:"I am not responsible" (0)

Anonymous Coward | about 2 years ago | (#40978725)

Jamie Dimon sold all of Chase's subprime assets when he became CEO.

In 2005.

So yeah; I would say he's not responsible for the financial crisis.

Not that facts matter in an election year.

Oh, shut up (5, Insightful)

realmolo (574068) | about 2 years ago | (#40978049)

'We're wrapped up in all this crap right now. We made a mistake. We're sorry. It doesn't detract from all the good things we've done. I am not responsible for the financial crisis."

Actually, it *is* your fault, and it *does* detract from everything you've done.

It's like a daycare provider saying "Sorry that we sold your kids' organs. It seemed like a good investment. But it shouldn't detract from the great job we were doing before that!"

Banks are supposed to MAKE money, not lose it. And they lost money on a MASSIVE scale due to incompetence and especially greed. Everything they do is tainted, forever.

Re:Oh, shut up (5, Insightful)

Anonymous Coward | about 2 years ago | (#40978077)

Also, it wasn't a mistake... it was premeditated fraud.

Re:Oh, shut up, but Remember (0, Troll)

BoRegardless (721219) | about 2 years ago | (#40978801)

The wonderful cleverly named "Community Reinvestment Act" was passed by Congress in the early 70s and banks nationwide were virtually told they must lend to poor credit risks in undesirable areas or face losing their banking charters.

So if you were a banker back then, what would you do, sell out, find a way around the coming bad loans or look for a method (read Fannie Mae and Freddie Mac) to offload the low quality loans.

Re:Oh, shut up, but Remember (2)

glodime (1015179) | about 2 years ago | (#40978947)

The "Community Reinvestment Act" doesn't require loans to poor credit risks.

Re:Oh, shut up (0)

Anonymous Coward | about 2 years ago | (#40978091)

We're wrapped up in all this crap right now. We made a mistake. We're sorry. It doesn't detract from all the good things we've done. I am not responsible for the financial crisis.

People: "So, are you going to help clean the mess up with all the money you took in with these deals? Or, y'know, change your investment strategies or-"

Dimon: "Shut the fuck up, pleb, we're not THAT sorry. Now get back in line and feed me your money. NOW!"

Re:Oh, shut up (5, Interesting)

Trepidity (597) | about 2 years ago | (#40978097)

And it's not like this particular fellow, Jamie Dimon, just got involved in the sector. He's got a long history [wikipedia.org] doing all sorts of stuff, some of it more on-the-up and some of it more questionable.

Re:Oh, shut up (0)

Anonymous Coward | about 2 years ago | (#40978117)

The statement itself smacks of elitism.

"We're wrapped up in all this crap right now. We made a mistake."

I've worked side by side with people who've fucked up before. And I'm not saying he should have thrown them under a bus, but a better statement might have been "Everyone is wrapped up in all this crap right now. A few people made a mistake."

"Decent, honorable people" (5, Funny)

Anonymous Coward | about 2 years ago | (#40978073)

Yeah, and serial killers are always described as real nice people by their neighbors.

Re:"Decent, honorable people" (0)

Anonymous Coward | about 2 years ago | (#40978673)

Serial killers are really nice people ... towards their neighbors.

Predatory bankers are really decent, honorable people ... towards fellow predatory bankers who they're wrapped up with.

Re:"Decent, honorable people" (0)

Anonymous Coward | about 2 years ago | (#40979109)

Most bankers probably are decent, honorable people. Unfortunately, those in charge are (in the words of Reverend Spooner) shining wits who will happily claim their leadership role (and their unacceptably, unreasonably large bonuses) while things look good, but will backpedal like crazy (and still accept their unacceptably, unreasonably large bonuses) and piss and moan about how its not their fault when things turn to shit.

There seems to be way less accountability in banking than in other industries with such wide-reaching impact.

Also, why did "treasury" show up as my captcha?

Hey Morgan, (0, Funny)

Anonymous Coward | about 2 years ago | (#40978095)

hope you have cancer. Now go fuck yourself.

Ginormous is not a word! (0)

Anonymous Coward | about 2 years ago | (#40978105)

It was cute when your mom let you say that when you were 6. It's not a word!
Enormous, Gigantic --Pick one. /Get off my lawn!

"The peak of financial innovation was the ATM" (3, Insightful)

nweaver (113078) | about 2 years ago | (#40978109)

Sorry, Jamie: your company has become largely a parasite. For the average American, you provide no more benefit than 10 banks 1/10th your size: when you get so big, you have negative economies-of-scale.

But your salary is dictated by being big.

If you were serious about preventing such disasters in the future, you'd reform your compensation schemes and endorse restoring Glass-Steagal.

Re:"The peak of financial innovation was the ATM" (2, Insightful)

jhoegl (638955) | about 2 years ago | (#40978207)

But regulations are bad!
They hurt job creators ability to create jobs in other countries, or make our kids work!

Some regulations are bad ... (2)

drnb (2434720) | about 2 years ago | (#40978885)

But regulations are bad!

Some regulations are bad. How often do we geeks criticize regulations/law/policies addressing the internet, computers, or other tech areas? What makes you think the US Congress does a better job in the domain of banking and finance than they do in the domain of technology?

There is nothing inherently wrong with wanting to reform regulations. The problem is that reforming regulations can be done as poorly as creating and implementing regulations.

Re:"The peak of financial innovation was the ATM" (1)

ducomputergeek (595742) | about 2 years ago | (#40978243)

They are in a left hand doesn't know what the right one is doing with fingers in so many pies. All they saw with the derivatives were double digit return rates quarter after quarter until the house of cards fell. So long as the profits were rolling in, they didn't stop to ask any questions.

Re:"The peak of financial innovation was the ATM" (1)

dnaumov (453672) | about 2 years ago | (#40978571)

Sorry, Jamie: your company has become largely a parasite. For the average American, you provide no more benefit than 10 banks 1/10th your size: when you get so big, you have negative economies-of-scale.

You have it backwards. Being Too Big To Fail is a fantastic benefit (for a bank) for being big.

Quote (0)

Anonymous Coward | about 2 years ago | (#40978129)

Is it just me or do i not see that quote in the article? Most bankers are decent, honorable people,' Dimon says. 'We're wrapped up in all this crap right now. We made a mistake. We're sorry. It doesn't detract from all the good things we've done. I am not responsible for the financial crisis.'"

Re:Quote (1)

nigelo (30096) | about 2 years ago | (#40978367)

It's you.
Look on page 3 of 3.

Vital Question . . . planning ahead (2)

StefanJ (88986) | about 2 years ago | (#40978171)

When JPMorgan is busted up into regional banks -- some of which do investment banking, the others FDIC insured savings & loans -- will they be able to share this server farm?

Re:Vital Question . . . planning ahead (1)

jhoegl (638955) | about 2 years ago | (#40978289)

Nope, the mother will get the kids... the mother always gets the kids

Worst Bank... (2)

tgetzoya (827201) | about 2 years ago | (#40978173)

I have not once opened a Chase bank account, but through mergers and acquisitions they owned 5 of my accounts at one time. Easily the worst bank I have ever had to deal with. But now I know where all my interest charges and late fees went to.

A funny side note...Capital One has done the same thing to me, they now own 3 of my accounts. I hope they're an easier bank to work with if something goes wrong.

Re:Worst Bank... (1)

MightyYar (622222) | about 2 years ago | (#40978847)

Worst was the old "CoreStates".

Chase was expensive, but not bad. I had an account there for years, but cancelled when they started charging me for the honor of putting money in their bank.

They are also big enough to be stupid. My credit card interest rate is very similar to my mortgage rate, all because they acquired my account from another bank that had given me a promotional rate that is now about 10 years old. I must have been part of some edge case during the database merge or something. Anyone else have a card pinned to 1.4% over prime rate?

JPMorgan's Blythe Masters (2)

udachny (2454394) | about 2 years ago | (#40978177)

I don't see banks as the source of the problem, they are part of the problem because they cooperate with the corrupt government, but they are not the source, the source is the government, however I do have a specific problem with JPMorgan and one particular person there - Blythe Masters.

She is pretty much somewhere near the root of the naked short defaults swaps and AFAIC, naked credit is just as much counterfeiting as the fractional reserve and the Federal reserve with its fake credit line.

JPMorgan holds a gigantic position in naked shorts against the silver market (and other markets), it's amazing that this particular activity isn't investigated, but the fact that it exists is just another side effect of fake fiat currency provided by the central banks.

Re:JPMorgan's Blythe Masters (1)

kraut (2788) | about 2 years ago | (#40978559)

What's this obsession people have with shorts? "Shorts bad, mmmm-kay?"

No. Every market takes buyers and sellers, and if I think silver is going to go down, while you think silver's going to go up, why should you be allowed to bet one way, but not I the other?

Also it's hardly new - it's been going on in futures markets for centuries - , or in any way related to the cause of the crisis.

Re:JPMorgan's Blythe Masters (3, Insightful)

udachny (2454394) | about 2 years ago | (#40978669)

Do you have problem concentrating? ADHD?

NAKED shorts, as in - nothing was borrowed to sell.

Break up the big banks and... (4, Interesting)

Anonymous Coward | about 2 years ago | (#40978195)

reinstitute Glass-Stegall, preventing conglomerates of investment banks with commercial lenders backed by government-insured savings and checking accounts. And the assembling of massive coast-to-coast financial supermarkets like Bank of America and Citibank should never have been approved by Federal regulators under the Clinton and Bush administrations.

Dimon and JPMC actually proves the rule. After the 2008 banking crash and TARP fiasco, Dimon was anointed as proof that not every big bank CEO was a bad egg. (Although JPMC accepted TARP money, they did so because Henry Paulson asked them to, not because they necessarily needed it). Jamie Dimon, said John McCain and many others, was old school and took his responsibilities to the world economy and banking industry seriously.

Obviously, not seriously enough in the face of the non-ending quest for superior returns and mind-blowing take home pay.

Re:Break up the big banks and... (2)

Tangential (266113) | about 2 years ago | (#40979033)

reinstitute Glass-Stegall, preventing conglomerates of investment banks with commercial lenders backed by government-insured savings and checking accounts.

Absolutely.
Let's also reinstitute the Bank Holding Act of 1956 [wikipedia.org] as well. When banks weren't giant, multi-state/multi-national conglomerates they couldn't become "too big to fail".

Pablo Escobar built schools and hospitals (2)

fustakrakich (1673220) | about 2 years ago | (#40978201)

He was still scum. And these bankers are laundering their drug money. This guy is trying to redefine decent and honorable. "Mistake" I like that.

Contractors here we come. (0)

Anonymous Coward | about 2 years ago | (#40978215)

just got word from robert half tech and another hire firm in orlando fl for contract work for jp chase
once again.

the first thing the devil tells you (0)

Anonymous Coward | about 2 years ago | (#40978247)

... is that he's not the devil.

Riiiiight (5, Insightful)

Nerdfest (867930) | about 2 years ago | (#40978261)

I am not responsible for the financial crisis.

No raindrop feels it's responsible for the flood.

Silly CEO (2)

milbournosphere (1273186) | about 2 years ago | (#40978267)

Instead of ranting about how it's not his fault, why didn't he just repeatedly mutter phrases about 'Big Data' and 'Cloud Infrastructure' to the reviewer?

Really. (5, Insightful)

rickb928 (945187) | about 2 years ago | (#40978271)

"I am not responsible for the financial crisis."

No, but the people who work for you were. And you're supposed to be in charge.

$500 Million for What? (1)

twmcneil (942300) | about 2 years ago | (#40978281)

This Dimon fellow is the best used car salesman I've seen for a while.

He kinda alludes to the fact that they will use this fantastic new data center for customer service. My guess is they will probably use it to scam more money from people with some devilish plot like HFT.

Re:$500 Million for What? (0)

Anonymous Coward | about 2 years ago | (#40978363)

1 million for computers.

499 million for having the bright idea to buy them.

Who cares? (3, Interesting)

gallondr00nk (868673) | about 2 years ago | (#40978327)

'Most bankers are decent, honorable people,'

Being decent and honorable isn't worth shit if the institution they work for is monstrous.

That's what it boils down to, at the end of the day. They internalised the profits and externalised the losses as best they could. They would have blown that bubble up for eternity if they could have, and paid no heed to the consequences. They want every cent you have, no less. Regulation kept them in chains, and now those chains are broken.

What we've witnessed is 30 years of large financial institutions gradually being allowed to do exactly what the fuck they want. Naturally, the monster devoured so much, so greedily, and took such monumental risks that it took merely a few years of true excess for it to ignite the biggest world slump since 1929. It didn't learn from then, it didn't repent or change its ways, and you can be sure as hell that it hasn't learned now. The devastation it wrought will happen again and again, simply because destruction is all it knows.

In light of that grim reality, who gives a toss how decent they are as individuals.

JPMorgan's IT Department (2)

mattyj (18900) | about 2 years ago | (#40978351)

So does this mean I can now use punctuation marks in my password? Seriously, you can't do this for online banking at Chase.

How is this necessary? (3, Interesting)

erbbysam (964606) | about 2 years ago | (#40978355)

"We were a port of safety in the storm."
“It’s a free. Fucking. Country.”

This article really makes me angry. Who does this support other than the IT industry that supplies them with 500 Million in servers, networking equipment & infrastructure?
What is this data center going to do? A grad student could design a decent database system for trades and banking. So they now have a 500 million $ data center, are they now going to use that scrape a few more milliseconds off there HFT's or the associated algorithm's? Are they going to figure out the optimal market strategy to beat there competitors? They can't possibly have enough data to fill something like that, so it has to computation power, right?

How does this contribute to society other than support an electric company? Don't give me liquidity bullshit.

Separate your banking from investing and then we can talk about how "banks" like this isn't a plague on society. /rant

Re:How is this necessary? (1)

Anonymous Coward | about 2 years ago | (#40978499)

I beg to differ. Aside from storing all the transaction data, the before mentioned bank has taken upon itself to literately spy on all their "high risk" customers. Now the definition of "high risk" is one that is constantly changing. But trust me, they have a lot of stuff on anyone they choose. They pretty much subscribe to all the so called "Big Data" companies, ChociePoint et al. I only assume that they will eventually move from just "high risk" to all customers, than to potential customers, then to "why the fuck not just call it everyone."

Re:How is this necessary? (3, Informative)

kraut (2788) | about 2 years ago | (#40978621)

Banks have a lot of data, and they need to do a lot of calculations on it. Simples.

And having a big data centre full of computers isn't going to help you with latency (i.e. HFT), it's for storage and throughput. E.g. to revalue your derivatives positions, run stress scenarios, risk analysis, regulatory reporting (from the general reporting you get the impression that Wall Street is completely unregulated; in fact, it's more the opposite).

How does this contribute to society other than support an electric company? Don't give me liquidity bullshit.

Liquidity is only bullshit until it dries up.

Re:How is this necessary? (1)

glodime (1015179) | about 2 years ago | (#40978897)

HFT

How does this contribute to society other than support an electric company? Don't give me liquidity bullshit.

Liquidity is only bullshit until it dries up.

The bullshit part is that the additional liquidity HFT provides is conditional on there already being sufficient liquidity.

Re:How is this necessary? (0)

Anonymous Coward | about 2 years ago | (#40978677)

"A grad student could design a decent database system for trades and banking"

Um. No.

Re:How is this necessary? (0)

Anonymous Coward | about 2 years ago | (#40978699)

"A grad student could design a decent database system for trades and banking."

Um. No.

Re:How is this necessary? (1)

alexander_686 (957440) | about 2 years ago | (#40978809)

Reading between the lines and knowing something about the industry I would guess this has almost nothing to do with the Investment Banking side and everything about running the boring bits of the business.
For a long time there was a question if mega banks could achieve better returns to scale then a large bank. For the 80s and 90s the answer was no. However, during the 2000s, mega banks have achieved economies of scale when doing international business. (we are talking about the boring, low margin bits - money management, custodial accounts, etc.)

You don’t spend this kind of money for high frequency trading. For that you want a couple of fancy servers near the exchange and some expensive quants. It is real money – but not 500m in Delaware money.

No, this is to handle X number of checking, credit card and mortgage accounts - ensuring that all of the interested is calculated correctly, all of the transitions are posted – in multiple states / countries with different reporting requirements – in real time – with a high level of reliability.

Re:How is this necessary? (0)

Anonymous Coward | about 2 years ago | (#40978839)

500 million? That is only a single days losses for this company.

Knight Capital. 440 million
http://dealbook.nytimes.com/2012/08/02/trying-to-be-nimble-knight-capital-stumbles/ [nytimes.com]

I think you should reconsider the risk of not investing a half billion dollars This is only a stop gap. We are considering the next step. shortening the distance a trade signal travels by sending protons through the earth. Purchasing a collider isn't affordable for every company so we will have a huge edge.

There is a rumor that this investment and our collider will stop terrorists and rogue states from laundering trades through our system as they have in the past.

Remind me to short JPMorganChase tonight (1)

xxxJonBoyxxx (565205) | about 2 years ago | (#40978375)

>> JPMorgan Chase spends $500 million to build a data center...asserts that huge data centers are among the advantages of ginormous banks.

Remind me to short JPMorganChase tonight. Even the tiniest bank has access to "huge data centers" today because most banks already use an outsourced financial processor...which are all hosted in centralized, redundant data centers (which generally cost less than $500M).

Seems like this guy missed the leveling effect of cloud services - one that descended on the banking industry a good 10-15 years ago.

Re:Remind me to short JPMorganChase tonight (1)

kraut (2788) | about 2 years ago | (#40978633)

Remind me to short JPMorganChase tonight. Even the tiniest bank has access to "huge data centers" today because most banks already use an outsourced financial processor...which are all hosted in centralized, redundant data centers (which generally cost less than $500M).

I wouldn't be altogether surprised if you found that JPMorganChase is the "financial processor" that lots of banks outsource their payment systems TO.

Just saying.

Seems like this guy missed the leveling effect of cloud services - one that descended on the banking industry a good 10-15 years ago.

Bankers are extremely conservative with this stuff, and (at least sometimes) for good reason.

I am not responsible for the financial crisis (2)

cant_get_a_good_nick (172131) | about 2 years ago | (#40978381)

No one person is. The financial crisis was built by a huge number of people.

But he did contribute. Part of the financial crisis is the lack of regulation in the industry. The London Whale incident proved we're not quite past it. Mr. Dimon sure as hell lobbied for less regulation.

I liken regulation to maintenance on your heart. The parallel is... your heart rhythm is surprisingly similar to the general market health. There are inputs (you're sick, you're running you're sleeping... vs. general economic news, P/E ratios, etc) and even feedback. It works most of the time. I wouldn't want to be on an EKG all day. You're not gonna put a pacemaker in me to regulate my heart-rate for the odd chance i may need it some day. Its a waste of the machine and my time.

But... every once in a while a heart can get out of whack. You get arrhythmia, and you need to shock it back to normal. My grandmother has a pacemaker. She'd be dead now if it wasn't for that. She also had a heart attack, luckily enough she was in the hospital when it happened, so she's ok. By the "never regulate" crowd's wisdom, they'd say "well, there are so many people's hearts that work fine that a pacemaker is never needed, it a complicated surgery that just gets in the way" she'd not have a pacemaker, and they'd assume she'd magically adjust.

So, we need to strike the balance. Too much regulation/heart shocking kills the market/patient. But, many people see the normal market/healthy heart and say "hey, we'll never need regulation, it's wasted money". They say, don't even have the doctor, don't even have the defibrillator. Well, then when the market shock comes, they're unprepared, and we all die. Or in this case, we came in in the last minute with the shock, too late, and the patient has limped along. And half the country states that the problem was the defibrillator, that somehow the heart attack patient would have magically come back all on their own.

Re:I am not responsible for the financial crisis (1, Troll)

kraut (2788) | about 2 years ago | (#40978679)

No one person is. The financial crisis was built by a huge number of people.

But he did contribute

So did everyone who leveraged up to buy a big house...

Part of the financial crisis is the lack of regulation in the industry.

I don't think there's another industry (apart from possibly medicine) that is as regulated as finance.

So lack of regulation per se clearly isn't the problem.

Bad, or badly enforced regulation? Yes, that could well be the case.

Remember the Madoff case? People reported him to the authorities years before it blew up... and nothing happened.

The London Whale incident proved we're not quite past it.

The London Whale incident proves nothing, apart from the fact that trades lose as well as make money. Yes, it was a big loss, and they should have had better internal controls, but they only lost money they could afford to lose.

THIS GUYS IS AN HONORABE JOB CREATOR! (1)

Anonymous Coward | about 2 years ago | (#40978413)

now blow his wang like a good republican should!

Re:THIS GUYS IS AN HONORABE JOB CREATOR! (1)

gagol (583737) | about 2 years ago | (#40979023)

+1 Funny, sadly I have no mod points left...

Well, this is stupid (1)

alexmin (938677) | about 2 years ago | (#40978419)

I would guess that given the implosion of US market volume and all that space built out recently demand for DC space is just not there. Smart players (like BATS for example) are picking up space freed up by other at discount. Looks like JPMorgan is not in this category.

Re:Well, this is stupid (1)

kraut (2788) | about 2 years ago | (#40978717)

Or maybe
* JP Morgan needs more space than can be picked up cheaply
* They're thinking countercyclically - I'm sure it was cheaper to build this now than during the boom.
* They're planning ahead - they need some of the space now, and will fill the rest over the next few years

It's all nice an well to rib big banks for being stupid, and it's true that they are often slow and inefficient. But they didn't get to where they are buy being totally stupid.

Just some management cretin wanting a monument (2)

gweihir (88907) | about 2 years ago | (#40978481)

That is what you usually find behind these projects.

As to "we made a mistake", if that were all it was, why are those few bad apples not in prison and stripped of their fortunes? You let it happen on your watch, you are just as guilty as these criminals!

who are we? (0)

Anonymous Coward | about 2 years ago | (#40978547)

We're wrapped up in all this crap right now. We made a mistake.

We as in the innocent, good bankers, or we as in the innocent, good bankers?

The mistake was greed, so 'we' is pretty straight forward mixing a bunch of words to make it sound good and admitting fault.

Too Big To Fail (3, Insightful)

cpm99352 (939350) | about 2 years ago | (#40978553)

Remind me again how many "too big to fail" banks/finance firms/etc. have been broken up since 2007?

my first dime on slashdot (0)

Anonymous Coward | about 2 years ago | (#40978653)

It's a first seeing all comments only on one - at least those marked as 3+.

Sadly they will go under the bridge, and banks will continue to play their games with us. What I'm scared the most is that we really can't do anything about it :(

Re:my first dime on slashdot (0)

Anonymous Coward | about 2 years ago | (#40978943)

What I'm scared the most is that we really can't do anything about it

Are you willing to do what can be done? You could join a credit union. Stop doing business with a large bank. If not then STFU.

Eh... quicken loans = chase for me (1)

Dead_Smiley (49033) | about 2 years ago | (#40978687)

I refinanced a couple of years ago with Quicken Loans. They told me if mortgage rates dropped within two years they would automagically lower my rate. What they didn't tell me is that they would immediately sell my mortgage. Turns out they sold it to Chase. So now I am stuck with these bastards unless I want to refinance again. I will probably do it but I will ask more questions this time. Damn, I haven't posted here for a while. =D

It is possible for a banker to do good (1)

istartedi (132515) | about 2 years ago | (#40979075)

Here is one example. [cbsnews.com] of a banker who most would consider "good". Two observations: 1. It's news that a banker is good. 2. It's a very small bank.

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