Dennis Kelleher, president of Better Markets, made the following statement on the JPMorgan Chase’s surprise announcement today of $2 billion in losses from trading in high-risk illiquid derivatives:
Ignoring the trillions in dollars of damage done by Wall Street in causing the economic collapse, JPMorgan Chase CEO Jamie Dimon has been a relentless critic of financial reform. He has denied that the biggest banks continue to threaten our financial system and our economy and claims they are well run and know how to manage risk. JPM’s announcement today of a surprise $2 billion in losses from illiquid derivatives proves him wrong and shows the need for financial reform, especially a strong Volcker Rule, to limit such risky betting.
Too-big-to-fail banks like JP Morgan, with trillions in assets and trillions more in high-risk investments and trading, require regulation and transparency. This is yet another example of the need for the more than $700 trillion derivatives market to be brought into the light of financial regulation. That is the only thing that will reduce the risk these banks pose to the taxpayers, the financial system and the economy.
Jamie Dimon and JP Morgan Chase just proved what anyone not getting a paycheck from a Wall Street bank already knows: gigantic too-big-to-fail banks are too-big-to-manage. They must not be allowed to continue to threaten our financial system and our economy.