Forum Post: Article: Jamie Dimon Just Admitted To The World That JPM Assets Are Overvalued By $150 Billion
Posted 5 years ago on Aug. 12, 2012, 6:59 p.m. EST by minhaalmaa
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Buried in its mandated report on JP Morgan’s contingency plan in the event of collapse, JP Morgan has admitted it’s assets are overvalued by $150 billion, essentially leaving their equity position at (-$16 billion)! The Morgue’s recent $7 billion CIO losses weigh slightly larger against a real equity of -$16 billion!
Reuters published an exclusive story this morning:
U.S. banks told to make secret plans for preventing collapse Buried in the final paragraph:
In a presentation in March, JPMorgan Chase said it had a recovery plan in place and said it was ordered by regulators. The presentation was organized by Harvard Law School and was closed to the media at the time, but is now available online.
Here’s the BEST part of the JPM document.
It’s easy to see on the PDF: http://www.law.harvard.edu/programs/about/pifs/symposia/europe/baer.pdf
Go to page 9. Under the wipeout scenario JPM describes a $50 billion trading loss turning into a $200 billion loss as soon as the FDIC takes over. Why… ? Because JPM says they would expect the FDIC to immediately writedown JPM’s assets by an additional $150 billion.
Holy mark to bulls*. Jamie Dimon just admitted to the world that JPM is mis-marking assets to the tune of $150 billion.
It gets better. Go to page 10. The chart shows that they only have $184 billion in equity, minus the $50 billion loss, minus ‘the $150 billion fdic reality adjustment’, which leaves them in a negative equity position of (-$16 billion).
So, we can extrapolate that without this phantom loss of $50 billion, JPM’s real equity position is just $34 billion currently, not the $184 billion on their books.