JPMorgan Buys Failed WaMu Assets for $1.9 Billion

Originally posted by Areal51
reply to post by mybigunit

 

I read what you wrote. And I read every post following that. But if you can, and if you feel moved, please explain why you would say that folks would lose deposits when nothing as such had been reported. You didn't credit your observations to the opinion of newscasters. I understand that it's breaking news, so should you.

Because if they did not open up the next day which at the time it was not known for sure then they would lose any deposits over 100k. That is the truth. Hey when news is breaking that is how things go sometimes.

BTW Edit to add also I put "Chances are if you go there tomorrow they wont be open" So I didnt GUARANTEE it would not be open. I said chances are.

[edit on 26-9-2008 by mybigunit]

Originally posted by dreamsnatcher
Grim, please don't make JPMorgan seem like a hero or some great company. They bought 300 billion in assets for 1.9 billion. Would you give me all your money for .05 on the dollar and think that was a good deal? They are absolutely laying the pipe to everyone of us and we think they care. I hate JPMorgan and will not have an account there no matter how big they are, I'd rather buy money orders at 7-11 than bank at Chase or Bank of America.

If you own stock in JPmorgan, the people who made this deal are heroes. If you are connected to WaMu bank, stock or otherwise, not so much. They are doing EXACTLY what business is meant to do in these situations. Don't hate them for it.

This is how businesses work. WaMu's banking assets were a big bargin to get for cheap, so they did. I don't understand your issue with it. FDIC just took over because WaMu was obviously heading face first to the dirt.

Also they didn't buy all the assets, just the banking ones.

My gut feeling is that if they pass the 700B plan JPMorgan will then sell all of the questionable loans to the GOV and pocket 200B from us sheeple. Thats just a guess and since I understand how corrupt these people are and how little they care for us consumers as people any chance they get to take my milk money they will. But hey its just business.

Well that would be true if they bought the "bad assets" which they didn't. They aren't selling anything.

Originally posted by SUNRAY06
www.save-a-patriot.org...

I see that JP Morgan is listed as one of the owners of the FEDERAL RESERVE BANK..so lets see How does this work..they lend themselves the money and we get to pay for it...MADNESS

[edit on 26-9-2008 by SUNRAY06]

like i told you it is all a conspiracy by the government to create the amero, and they are doing the bail out to prolong the collapse of the economy until they want it to officially collapse. This imo will happen in feb. or april.

Originally posted by grimreaper797
reply to post by camain

 

Same thing was going to happen when WaMu went over within the week. Their stocks were plummeting and their status was downgraded from junk bond to an even LOWER junk bond status. They were ready to fail. When they did, JPmorgan would have bought it for an equal or even lesser price.

Also, they didn't completely buy WaMu, just a significant piece. They picked up the banking sector of WaMu and left the FDIC to deal with the lending sector.

Do you mean (not trying to be facetious) that JPM got the assets, and left the debt for the FDIC to deal with? How does that work?

Also, the title of the thread is kind of misleading. JPmorgan didn't buy the failed WaMu assets, they bought the good WaMu assets and left the bad ones to the FDIC.

WaMus banking was in decent condition, it was their lending that was under junk bond status. I would say the title would more accurately read "JPmorgan Buys WaMu Banking Assets For 1.9 Billion"

reply to post by SUNRAY06


You are right and sometimes you need to step away and think. Follow my logic and see if you agree.

Fed owned by - private banks (Goldman, JPM, Not sure who else and just a guess)
JPM buys WAMU, .05 on the dollar, gets 200B in homes (current value), FED loans gov 700B (fed loans guarantee 6% return by collecting tax on sheeple) to buy all questionable loans (at current value) probably like .50 on the dollar. JPM makes .45 on the dollar plus gets large number of loans in good standing. FED keeps printing money driving the value of the dollar into the ground and will need more bailout as we realize most people can not afford 500K homes, 6.00 a gallon gas, 6.00 a gallon milk, 5.00 loaf of bread, 2.00 per apple, yada, yada, yada. I'm looking at this through my fluoride coated brain so just tell me if i'm wrong or on the right track. And who is asking for the 700B anyway? My guess FDIC. Will the real freak out occur when the FDIC fails and your precious $$$ is no longer insured. See I'm not worried as I lost all my money already.

reply to post by Maxmars


When a company goes under or a bank get overtaken by the FDIC, the goal is to sell off everything, regardless of how low it has to drop. Thats the only thing better than a fire sale, a collapse.

Once it goes under, the only goal is to get rid of the assets ASAP. They can sell it in pieces or as a whole. The only goal is to get rid of it, so if JPmorgan wants to buy the banking part of WaMu, 1.9 billion was obviously good enough for the FDIC to get rid of it.

Its just a matter of how low they will go. I mean if somebody offers .1 cents on the dollar for these bad assets, and nobody else will buy them, that might be the route that gets taken since they need to get rid of the assets.

Unless of course you want the money to come out of your pocket to hold these assets via taxes. If not, the goal is for the FDIC to get rid of all the assets and salvage some of the company's stock holders.
At least the company didn't go bankrupt and the stock holders lost everything.

reply to post by grimreaper797


Grim I don't see anyone as heros when the value of the company is gone. How is buy Bear Stearns/wamu for 2 per share saving anyone? that just means you lost everything but 2 per share unless you shorted the whole way down, then you did real well. But the average investor does not short or even understand that tactic. GS shorted the housing market and made a profit, but now no more shorting. When they called all the CEO's to congress to answer why things were bad and if they had shorted, they conveniently did not invite GS to the questioning. So when they asked did you short housing the ones present could say, No. But GS wasn't there. These companies are so corrupt I bet JPM shorted WAMU from the top down. I don't put anything past the lot of them. Thank god for Sarbane Oxly, these companies have been held to such a high standard since Enron.

Grim think about the leverage you have when you write the loans and collect on them and you know before everyone that housing is going into the tank. How nice that would that information be for shorting purposes? Plus you can actually help it along by driving the value of the dollar by printing to much, guaranteeing the failure of housing. Just think how hard it will be to sell a home when they raise interest rates, which at some point they will have to.

Anyway you are more informed than me and I am alittle emotional about this as i'm one of the people that has lost everything. I just have a hard time believing anything i'm being told by politicians and bankers. My beef is not with you in any way.

reply to post by dreamsnatcher


Point blank, if you own stock in JPmorgan, they just made you money. Their stocks will continue to climb, and they just made a hell of a deal for their company by buying WaMu's banking branches.

If you invested in WaMu, sorry. This is what happens when a company goes under. They go under and others pick up the assets for dirt cheap. Thats just the way the market works.

Originally posted by dreamsnatcher
reply to post by SUNRAY06

 

And who is asking for the 700B anyway? My guess FDIC.

I thought you might find this little snippet from Forbes interesting:
(Bold text is my emphasis which relates to your question.)

The Paulson Plan
Bad News For The Bailout
Brian Wingfield and Josh Zumbrun 09.23.08, 6:39 PM ET

Lawmakers on Capitol Hill seem determined to work together to pass a bill that will get the credit markets churning again. But will they do it this week, as some had hoped just a few days ago? Don't count on it.

"Do I expect to pass something this week?" Senate Majority Leader Harry Reid, D-Nev., mused to reporters Tuesday. "I expect to pass something as soon as we can. I think it's important that we get it done right, not get it done fast."

Sen. Sherrod Brown, D-Ohio, says his office has gotten "close to zero" calls in support of the $700 billion plan proposed by the administration. He doubts it'll happen immediately either. "I don't think it has to be a week" he says. "If we do it right, then we need to take as long as it needs."

The more Congress examines the Bush administration's bailout plan, the hazier its outcome gets. At a Senate Banking Committee hearing Tuesday, lawmakers on both sides of the aisle complained of being rushed to pass legislation or else risk financial meltdown.

"The secretary and the administration need to know that what they have sent to us is not acceptable," says Committee Chairman Chris Dodd, D-Conn. The committee's top Republican, Alabama Sen. Richard Shelby, says he's concerned about its cost and whether it will even work.

In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.
"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."

Wow. If it wants to see a bailout bill passed soon, the administration's going to have to come up with some hard answers to hard questions. Public support for it already seems to be waning. According to a Rasmussen Reports poll released Tuesday, 44% of those surveyed oppose the administration's plan, up from 37% Monday.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, who testified before the Senate committee Tuesday, will get a chance to fine tune their answers Wednesday afternoon, when they appear before the House Financial Services Committee.

A spokesman for House Speaker Nancy Pelosi, D-Calif., says she is optimistic that the House will pass a bill this week. But that doesn't mean the Senate, which is by nature more sluggish than its larger counterpart on the other side of Capitol Hill, will be so quick to act.

"They will act first," says Sen. Minority Leader, Mitch McConnell, R-Ky. "Many of our members today were just beginning to have interaction with Secretary Paulson."

Dodd proposed his own counter-proposal to Paulson's plan earlier this week. Among other things, it calls for limits on executive compensation at troubled firms and for the Treasury to take a contingent equity stake in those firms. On Tuesday, Paulson rebuffed both ideas, as it might discourage firms from participating in the bailout program.

Those things aside, lawmakers have plenty of other concerns with Treasury's proposal. Sen. Charles Schumer, D-N.Y., suggested the bailout be doled out perhaps $150 billion at a time, instead of $700 billion all at once. Sen. Mike Enzi, R-Wyo., says it has an initial cost of $2,300 for every man, woman and child in the country. Sen. Jim Bunning, R-Ky., calls it a "financial socialism and it's un-American."

Dodd says that in speaking with his Senate colleagues, all are agreed on three issues: that a bailout bill include some oversight accountability for the Treasury, protection for taxpayers and that it address the continuing foreclosure problem.

He also points to one other concern: Paulson, the bill's chief architect, is scheduled to leave office in just four months.

"I'm not about to give a $700 billion appropriation to a secretary I don't know yet," says Dodd.

--Senior writer Liz Moyer contributed to this article.

reply to post by grimreaper797


Thank you GR! I was curious - that makes more sense.

Looks like the doomsayers are all wrong - again. Looks like people were being overly dramatic - AGAIN!

As of 1:29 p.m. CST the Dow was UP 30 points, not down. In fact, it has not been down anywhere close to what was predicted (300 to 400 points I believe on the 2nd page). And a deal on the bailout still has not been reached.

Can't you guys accept that things aren't as bad as your peers or the media make them out to be?

And the devil is in the details looks like it did hurt JPMorgan a little bit to acquire WAMU

Sept. 26 (Bloomberg) -- JPMorgan Chase & Co. raised $10 billion in a stock sale to cover writedowns and losses after taking on deposits and branches of Washington Mutual Inc., the biggest U.S. savings and loan, for $1.9 billion.he shares were sold for $40.50, or 6.8 percent less than yesterday's closing price of $43.46. New York-based JPMorgan sold 246.9 million shares, according to a statement today.

JPMorgan, now the largest U.S. bank by deposits, said the capital infusion would offset an estimated $8 billion of credit provisions, writedowns and losses in the third quarter. The WaMu acquisition will force JPMorgan to set aside an additional $2 billion to cover bad loans on the failed thrift's books. Chief Executive Officer Jamie Dimon said the deal would boost earnings per share by 50 cents in 2009.

JPMorgan had to find more capitol to cover buying WAMU.

JPMorgan is adding $176 billion in mortgage-related assets and will write down the value of those securities and other portfolios by $31 billion, the company said. The bank will pay $1.9 billion to the U.S. Federal Deposit Insurance Corp. as part of the deal. The bank said it may sell another 37 million shares to cover excess demand.

SOURCE

So tell me again how this helps not hurts JPMorgan in the short term?

In a time when Banks are going fail as we have already seen. Investing the very capitol that your going to need to stay afloat to buy more assets that you will not be able to move because there is no market for them does not make any sense. what happens when JPMorgan Can't get billions in capitol from stock sells in the coming weeks?

They follow WAMU only thing is there is no one to save JPMorgan now.

Moral of the story These bankers have not learned the lessons of the past and they are way behind the curve of the current lesson being taught right now.

Grim you can try and spin it anyway you like. But the simple fact of the matter is JPMorgan DIDn't have the capitol on hand to buy WAMU and cover its bad debts from the parts of WAMU it bought and also cover their own books. They are taking on to much risk in a time when they should not be taking risks!

Originally posted by sos37
As of 1:29 p.m. CST the Dow was UP 30 points, not down. In fact, it has not been down anywhere close to what was predicted (300 to 400 points I believe on the 2nd page). And a deal on the bailout still has not been reached.

This should make you more nervous. Either persons on Wall Street are getting fed insider information that we do not have. Or the market is behaving completely irrationally. By all logic and understanding the markets should have been tanking today, futures pointed to it, common sense pointed to it. The Nations largest bank failure occurred just before this trading session. The capital markets are completely dry.

The market is either being manipulated or has lost all grounding. Either is a bad thing.

They sure know how to keep people distracted. If this failed to distract everyone, I wonder what else would have happened?

reply to post by DisabledVet


Great to see you have become one of the few who have realized how the whole system is and has been rigged by the international bankster cartel.

Now everyone needs to learn the truth so we can audit all the firms involved:
SEC, Rating agencies, Secretary of the Treasury, Fed Reserve, IMF, The World Bank, Bank for International Settlements, the world's central depositories, Freddie and Fannie.

All of the above are owned by Rothschild, Morgan, Rockefeller, Warburg etc.

These guys are the ones behind the scenes pulling the strings of all commodities, gold, worlds currencies because they are controlling shareholders in the worlds gold, diamond, and supply of currencies the world over. Once you gain control of the SUPPLY of anything, you have a monopoly and the framework for a true NWO.

Our financial system was 'designed' to fail by these banksters all along. Its financial and economic terrorism and tyranny and this alone provides the motive and right to audit the above institutions with a worldwide consortium of auditors to ensure the auditors aren't blackmailed, threatened, or (commit suicide) or rather murdered.

They will stop at nothing to achieve a NWO and 9/11, WTC93, USS Cole, USS Liberty and on and on were just created to cause a panic in America to bring in more NWO legislation (The Patriot Act, 700Billlion asset grab etc.) to gain more control and rid of us our Consititutional liberties and highjack our Bill of Rights.

People need to understand this worldwide for the system to 'correct' itself and bring a restored faith in the worlds financial systems.
See my other posts for more.
Audit and prosecute em all!!!
There is NO other choice from here on out.
They know they've been exposed and want to consolidate US assets while the gettin is still good.
Are we to stand by allow these people to create a true sheeple class of uninformed surfs? That's what is ahead if we don't act NOW!!


[edit on 26-9-2008 by Perseus Apex]

[edit on 26-9-2008 by Perseus Apex]

And is it not true that there are only five countries left in the world that do not have a Rothschild dominated central bank? Iran, North Korea (where is Kim?), Cuba, Libya, and Sudan.

reply to post by jackinthebox


Very true. That is the reason these international banksters have pulled the strings of our govt to take over these holdouts. Once these remaining countries are taken over, then their currencies will merge into the combined future Amero currency and Euro to create a ONE WORLD CURRENCY. This was their plan envisioned since the late 1700s.

Once one reads every word of the links below you will become what they say 'enlightened'. The truth is out there for those who seek it.
Its great to see people here on ATS wake up to reality.
You deserve to be one of the first informed. You sought it.
Now its your turn to lead with what you know.
Its your responsibility now to spread the word among the brethren.

No more divide and conquer techniques 'designed' to weaken and indebten a coutry to take it over. These games must end and end NOW!
Thats the first step. You can't defeat a tyrant if you don't know how they operate.

quotes.liberty-tree.ca...
quotes.liberty-tree.ca...
quotes.liberty-tree.ca...

And finally, the timeline, the master plan as recorded through history:
iamthewitness.com...



[edit on 26-9-2008 by Perseus Apex]

reply to post by mybigunit

TextThere is validity to your point for sure. When you look at all of the financial crisis over the past 100 years theres always a power grab the big taking out the small. I totally agree. Heres one thing though and that is Lehman had a part of the FED and it went under. This is my only flaw in your theory. Jp Morgan is a FED bank and so is Citi and yes they are still going strong B of A though Im not sure if they are a FED bank or not.

Lehman are owned by the same international banksters involved in taking them over. They are just consolidating their own assets. Your theory is correct.

reply to post by mybigunit

Well it was JP Morgan who started rumors to start the panic of 1907 which led to the creation of the FED. The FED since then has really done the opposite of its intention since then. They CAUSE these problems though credit extensions and retractions leaving not enough money in the supply to pay all the debt with interest. Complicated and I dont feel like explaining it no offense.

Yes, and it was Rothschild who, during the Napoleanic war with England, had his courier arrive before the official English courier so he could cause a panic in Englands financial system. Rothschild got word that the English had won though he fooled the public by selling all his investments on the open market to fool the public into believing English had lost the war. He knew they won the war and subsequently, hours later bought up all the shares he just sold and then some in order to take over the English banking system. The family has owned the English banking system ever since.

Its all here:
iamthewitness.com...

Grim, you bring up interesting points, but even at $.25 on the $1.00, these "good assets" may not be so good... People STILL may not be able to afford these mortgages. It's not as easy as you are saying it is, in my opinion. I could be wrong, I don't claim to have any great knowledge of these things, but knowing how things are "on main street" (as the media beats into the ground), it is not certain that people will be able to re-finance even at the reduced cost.

And you don't even know if JP Morgan will offer reduced rates, do you?

I mean if they were truly on the up and up they would, but...

If it is an intentional crash, like some think, then they are just holding on to this stuff until they get "consolidated" into something else.

I am convinced this is what most of the people here think it is, it's just a power grab by the elite...