JPMorgan Chase Reports Q3 Profit of $3.6 Billion Powered By Investment Banking

October 15, 2009 by · Leave a Comment
Filed under: Industry News 

If you get basically free money from the central bank and have mark-to-market accounting rules changed so you don’t have to realize many losses, then you bet your bottom dollar you can make a profit as a commercial/investment bank.  Heck, if you can’t make money in that environment then you are in the wrong business.

One piece of interesting information is that JPMorgan set aside another $2 billion in reserves in anticipation that their consumer credit card division will be taking some more hits in the future.   This brings the total to over $31 billion in bank reserves against potential losses.  CEO Dimon made a statement that he thought consumer credit may be stabilizing but he was still cautious.  With unemployment expected to rise in the coming months, it is very likely that we will see increasing credit card and loan defaults in the coming quarters.

Also many analysts still believe with the Dow at 10,000, we have come too far too fast and the valuations are not realistic for the mode our economy is in.  Some estimates say we should see a 15-20% correction to bring it in line to more realistic valuations but at the moment they see people chasing the market and it would not be surprising to see it increase from here regardless.

NY Time Article

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!