JPMorgan, Government Reach “Tentative” $13 Billion Deal Over Mortgage Bonds

Doesn't include resolution to ongoing criminal probe

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Jerome Favre / Bloomberg / Getty Images

Updated: Saturday, October 19, at 3:25 p.m.

JPMorgan Chase & Co. are near to settling a federal investigation into its mortgage practices through a tentative $13 billion deal with the U.S. Justice Department, reports the Wall Street Journal.

The record agreement includes JPMorgan Chase doling out approximately $4 billion to the Federal Housing Finance Agency on behalf of financial agencies Freddie Mac and Fannie Mae, which claimed the bank misled them in the quality of mortgages sold during the housing bubble, sources close to the discussions told the Journal.

The deal will require the bank to continue cooperating in an ongoing criminal probe, which Attorney General Eric Holder has refused to drop, related to the bank’s history of mortgage bonds sales and its role in the mortgage crisis that began in 2008.

The particular language of the deal is still being hammered out.

More recently JPMorgan Chase reported a third quarter net loss of $380 million on Oct. 11, citing legal costs.

[Wall Street Journal]

This post was updated to reflect JPMorgan Chase & Co.’s tentative deal with the Justice Department.

4 comments
BabuG.Ranganathan
BabuG.Ranganathan

SOCIETY’S RIGHTS VS. CAPITALISM’S RIGHTS

Babu G. Ranganathan

Many in society have been taught to believe that the public has no right to tell corporations what to do with their money any more than a private citizen has the right to tell his neighbor what to do with the money he earns from a business or store. This is not a fair analogy.

True enough that a private citizen doesn't have the right to tell his neighbor what to do with his money but the public does have the right to tell corporations what to do with their money. Why? Because corporations couldn't exist without very special and unique government help. Corporations are special legal entities that have unique rights, privileges, and protections given by government that ordinary citizens and business owners do not have. And, since the government in a democracy like ours comes from the people (the majority in society) the people have the right to determine how corporations act and how they spend their money. The majority in a democracy own the franchise of government! 

Therefore, the public has a right to demand something from corporations in exchange for giving corporations the right to exist. Would I not have the right, even as a private citizen, to demand something from a business built on my property? The same logic applies to the relationship between the public (society) and corporations. Corporations cannot hide behind the specious argument of rugged individualism!

Many in our society have been brainwashed to believe that an absolutely free market place with no government controls or regulations would automatically fix our nation's problems. Have we forgotten already that the Great Depression of the early 1930's was the direct result of a free market economy with no government control or regulation?

Rugged individualism teaches that the individual has the right to benefit from social and economic interactions with society, but that society has no right to demand any benefit from the individual.

However, if it is true that a person has a moral right to be a rugged individualist, looking out only for himself, then it also follows that individuals (plural), by mutual consent and agreement, have a moral right to look out for themselves. Such a moral right of individuals (plural) is the basis for majority rule and unions in our society.

Certainly, if an individual is benefiting from commerce with the many individuals of society, then the many individuals of society have a right, by mutual agreement among themselves, to demand certain benefits from the individual, benefits such as decent wages, clean air, clean water, safe working conditions, safe products, etc.

No one has absolute individual rights in society. Those who want absolute individual rights must live outside of society. Those who want to be part of society with the benefits of government and law must be willing to grant what the majority want, even if it's at their own expense.

Yes, minorities have rights, but the majority has more rights.

Absolute individualism is absolutely unfair. The majority has the right to tax and use taxpayers' money to build a park even if individuals don't want or use the park.
 
Self proclaimed rugged individualists in society want all the benefits of what the majority has to provide - government, law, security, and protection - but they do not want give up anything to the majority in exchange for these benefits. These so-called rugged individualists are the real leeches and parasites of society.

The fact is there are no real rugged individualists in society!  

If capitalism and social consciousness cannot coexist then how is it that modern industrialized nations such as Sweden, Norway, Denmark, and others can have a high degree of social consciousness and still be capitalistic with a thriving free enterprise.

The rich are not paying their fair share of the taxes. Even billionaire Warren Buffet has said that his office secretary pays more in taxes in proportion to her income than he does.

In fact, one of Senator Obama's ideas for reviving our economy is by the federal government spending money to repair the infrastructure in our country (roads, bridges, highways, etc.). Much of this money would come from taxing the wealthy and corporations and making them pay their fair share taxes.

People can still become wealthy in a socialist society but not at the detrimental expense of others in society.

Many of the basic rights, especially regarding safety in the work place, that we take for granted were not graciously given to society by the rich but won by the blood of bludgeoned workers and strikers in the early twentieth century.

The Bible doesn't say that money is the root of all evil, but that "the love of money is a root of all sorts of evil." That love of money must be constrained in society or the worst aspects of capitalism will make a living hell for millions. Thank God, of course, that there are some capitalists who don't put money first or love money. God bless them!

The Christian Scriptures have much to say against the rich and wealthy who obtain and maintain their wealth through the detriment of the rest of society (James 2: 6, 7; 5: 1-6).

The author, Babu G. Ranganathan, has his bachelor’s degree with concentrations in theology and biology and has been recognized for his writings on religion and science in the 24th edition of Marquis “Who’s Who in The East.”

FredFlintsone
FredFlintsone

which represemts13% of JPMs 2012 revenues, just cost of doing business. JPMs business partner the government is happy too