JPMorgan Chase admitted to a massive $2 billion trading loss because of wagers gone wrong by its in-house trading operations. Mark Williams teaches finance at BU’s School of Management and is a former Federal Reserve bank examiner. He is the author of Uncontrolled Risk: The Lessons of Lehman Brothers. Williams offers the following comment:
“These substantial trading losses demonstrate excessive risk-taking at the highest level of the bank. JPMorgan lost billions not caused by a rogue trader, but by approved rogue policy. As a too-big-to-fail bank, it needs to curb its risk-taking appetite. It should not be allowed to engage in strategies that put taxpayer money at risk.
“Stronger Fed oversight action is needed. It must immediately curb JPMorgan’s excessive risk-taking appetite and demonstrate they are going to aggressively manage banks that can put our economy in peril. As the biggest U.S. bank, JPMorgan has a duty to behave in a responsible manner and cease activities that could ripple negatively into the overall economy.”
Contact Williams at 617-358-2789; firstname.lastname@example.org