Why is JPMorgan So Big? Double Leverage
So when we ask why large banks are so big, the answer is that the Federal Reserve Board allows large BHCs to use more leverage
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The Institutional Risk Analyst
© 2003-2023 | Whalen Global Advisors LLC All Rights Reserved in All Media | ISSN 2692-1812
Banks | Markets | Fintech
R. Christopher Whalen
- Jul 20
- 5 min
Update: U.S. Bancorp & Goldman Sachs
We expect to see USB trading at a discount to JPM and Peer Group 1 until the bank improves its operating leverage to pre-COVID levels.
527 views
R. Christopher Whalen
- Jul 16
- 6 min
What Does Washington Federal Say About Bank Earnings?
We all dodged a bullet in Q2 2023 because the repricing of assets and deposits slowed from the crazy levels seen at the end of March.
915 views
R. Christopher Whalen
- Jul 15
- 5 min
Bank Earnings: JPM, WFC & Citi
JPM has an impressive lead in earnings and growth over WFC and C, neither one of which is positioned to catch up with Jamie Dimon in 2023.
478 views
R. Christopher Whalen
- Jul 11
- 4 min
Michael Barr's Capital Proposal Deliberately Misses the Point
The sad fact is that even with another 2% capital, most US banks are arguably insolvent thanks to the Fed “going big.”
1,148 views
R. Christopher Whalen
- Jul 8
- 7 min
Mortgage Lenders Face Return of a Purchase Market
The “winners” in the mortgage sector will be those larger players with equally large servicing books that can access bank funding
890 views
R. Christopher Whalen
- Jul 5
- 6 min
Housing, China & the Dollar
The world of secured finance is still coming to grips with the idea of several more increases in the federal funds rate this year.
938 views
R. Christopher Whalen
- Jul 3
- 7 min
Top Five Banks: JPMorgan Leads the Pack
JPM is really a large mutual fund with a bank attached, as shown in the table below.
797 views
R. Christopher Whalen
- Jun 28
- 7 min
Profile: Comerica Inc.
If the FOMC raises the target rate for fed funds further, then banks like CMA are likely to come under renewed selling pressure.
1,350 views
R. Christopher Whalen
- Jun 26
- 8 min
Update: Mortgage Lenders, TBA Contango & MSRs
We look for lower prices for legacy MBS and MSRs as new allocations are used up and P&Ls sink deeper into the red...
1,070 views
R. Christopher Whalen
- Jun 21
- 5 min
Update: GS, MS, SCHW, RJF & SF
If you agree with our view that the short-selling of the stock was mistaken, then the discount for SCHW is unwarranted.
849 views
R. Christopher Whalen
- Jun 19
- 8 min
Powell Ought to Pivot to Bond Sales
If the FOMC raises fed funds further, bank failures and perhaps even a market access crisis for the Treasury are next.
1,641 views
R. Christopher Whalen
- Jun 14
- 5 min
Update: Banks & Fintechs
With inflation fears moderating, look for Buy Side managers to buy bank stocks – even if earnings remain constrained...
767 views
R. Christopher Whalen
- Jun 12
- 5 min
Bank Deposits vs US Treasury Bills
Remember, for every $1 in debt redeemed on the books of the Fed, a bank deposit disappears.
1,878 views
R. Christopher Whalen
- Jun 9
- 6 min
Profile: Synchrony Financial
What can SYF tell us about the bleeding edge of unsecured consumer credit?
656 views
R. Christopher Whalen
- Jun 6
- 6 min
AI, Automobiles & Great Cities
If it’s artificial, then it’s not intelligent.
1,148 views
R. Christopher Whalen
- Jun 5
- 2 min
The IRA Bank Book | Q2 2023 Industry Outlook
How much of book value do banks lose
as the Fed adjusts interest rates to fight inflation?
852 views
R. Christopher Whalen
- Jun 1
- 4 min
First Take on FDIC Bank Data
If we assume that asset returns will continue to rise, but that bank funding costs will rise 5x asset returns, then US banks have a problem
1,052 views
R. Christopher Whalen
- May 29
- 7 min
Calculate the WAC of Bank of America
If you believe that the Fed is going to keep interest rates at or above current levels through to 2024, then we have a problem....
2,718 views
R. Christopher Whalen
- May 25
- 8 min
Interest Rates, MSRs, Mortgage Putbacks & FICO Scores
Persistent talk about a 5.5% 30-year mortgage rate later this year is badly wrong as TBAs flip from 5.5% to 6% coupons for delivery in June
1,108 views
Christopher Whalen
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