On Tue, Jul 23, 2002 at 04:30:55PM -0400, Nomiprins at aol.com wrote:
> In a message dated 7/23/2002 2:45:32 PM Eastern Daylight Time,
> laflame at aaahawk.com writes:
>
>
> > Though the DOW is relatively stable today the banks are imploding. They are
> > blaming it on Congressional hearings but I don't think that's the whole
> > story. Citi and JPMorgan down near 20% for the day.
>
> Aside from a series of lawsuits, Citi and JPM are sitting on billions of
> dollars of non-performing loans through credit facilities they offered
> flailing and bankrupt companies over the past two years. Since most of the
> companies, particularly the ones in the telecom sector (4 of which - Global
> Crossing, Adelphia, NTL, and WorldCom make the all time top 10 bankruptcy
> list), are comprised of almost worthless assets due to immense over-capacity
> post dereg in 1996, the banks have little hope of retrieving anything, even
> after long drawn out bankruptcy court hearings. It doesn't help that JPMChase
> and Citi in particular had a nasty habit of diving in with loans for
> companies whose values were diving faster - on the off-chance of capturing
> investment banking fees.
>
> Separately, JPMChase is the poster child of why Glass Steagal shouldn't have
> been repealed, and spends more time pointing figures at Citi than protecting
> its own retail customers.
>
> Nomi
-- Michael Perelman Economics Department California State University Chico, CA 95929
Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu