The Inimitable Tiff

  1. The Need For An Independent Investigation Into JP Morgan Chase | The Baseline Scenario

    In effect, JPMorgan Chase operates with the implicit backing of the United States government – primarily in the form of actual and potential access to borrowing from the Federal Reserve, with the implication that the Treasury could also provide support. Being effectively backed by the full faith and credit of the government is a great help; it lowers a bank’s funding costs because it reduces the risk to creditors. JPMorgan Chase and the other big banks in the American economy are effectively government-sponsored (and subsidized) enterprises.

    There is no kind of market involved in determining the franchise value of mega-banks; this is a government subsidy scheme, pure and simple. …