The following article is brought to you by Raymond J. Learsy HuffingtonPost.Com.
Wall Street continues in its ways unabated. Here we have a nation with 9% plus unemployment, an economy that is deep in recession and at the precipice of worse with a government that protects one sector of the economy, the financial sector, to the vast expense of the working stiffs who keep the country functioning on a day to day basis.
And now, to bring insult to injury, J.P. Morgan Chase with all its access to taxpayer funded programs and Beltway agencies, ranging from the TARP bailout of the financial sector, access to the Federal Reserve window and its de minimus cost of money, the mortgage backstop of the Freddie Mac and Fannie Mae programs, its depositors monies guaranteed by the Federal Deposit Insurance Corporation and on, has now outdone itself reaching the Herculean heights previously scaled when its policies led to foreclosure on the homes and families of servicemen on active duty in Afghanistan and Iraq.
Not content to play in the casino with its access to money chips underwritten in large measure by the myriad government programs referred to above, J.P. Morgan Chase has now gone one step further and is buying an important stake in the Casino itself. As reported by Bloomberg buying a stake from MF Global (a provenance that speaks for itself) in the London Metals Exchange that will make it the largest single share holder ahead of guess who? Right, Goldman Sachs!
Now what exactly is an institution that calls itself a bank at this critical time in the nation’s economic crisis — with its urgent need for an accommodating banking sector — doing using resources made available to it in large measure by taxpayer funded programs buying a stake in the gaming tables themselves? Might it have anything to do with that tidbit of information reportedjust under a year ago by the Telegraph revealing that J.P. Morgan Chase was the “mystery trader” that bought £1billion-worth of copper on the LME. That purchase, according to the Telegraph, pushed up the price of copper at the time to the highest level since the financial crisis in October 2008.
Bravo, that’s just what a bank with all its access to those government programs is meant to do. Speculate on the exchanges, be it copper, oil, food grains and on, to make life more expensive for all of us. And this is but one example of the distortion enabled by commodity exchanges, such as the LME and their willing gamblers such as J.P. Morgan Chase who are neither consumers nor producers of the commodity traded, but like hanging out at and playing the blackjack or roulette tables.
One only need go back to the comments Leon Hess, the legendary founder of Hess Oil and then the dean of the oil industry, made to the Senate Committee on Government Affairs on November 1, 1990. ” I’m an old man but I’d bet my life if the Merc (the New York Mercantile Exchange) was not in operation there would be ample oil and reasonable prices all over the world without this volatility.” Things have only gone downhill ever since. May Leon Hess rest in peace.
Which raises the question, why are we letting these ‘banks’ play roulette with what, given all the government’s involvement, is our money, and now they are positioning themselves to buy the roulette table? Is it not long past time that the moniker of ‘bank’ is lifted from them, with all it means in its access to myriad public funding programs. If they want to gamble, they, as any of us should be free to do so. But the rest of us do it with our money, at our own risk, not piggy backing on public financed initiatives with these banks’, “Heads I win, tails you lose”, ethos.