Can We Make It Five Straight Up Days?

Eh…probably not, but you never know. The U.S. stock market is looking to open lower today even though the Prime Minister of Greece survived his no-confidence vote today.

The main of focus of today’s trading will be the Federal Reserve’s meeting. The policy statement will come out at 12:30 and Ben Bernanke’s press conference will be at 2:15 pm. Most likely, this will be a non-event.

What’s interesting is that Bernanke’s latest comments have been directed to Congress. He wants the U.S. to clean up its fiscal mess, but not just yet; otherwise it could spoil any possible recovery. Specifically, Bernanke has said that Congressional negotiators shouldn’t use the debt limit debate as a bargaining chip to force spending cuts.

JPMorgan Chase ($JPM) said that it reached a deal with the SEC yesterday to pay a $153.6 million fine to settle charges that they misled investors.

In March and April 2007, as the housing market teetered toward collapse, J.P. Morgan senior management pressed the salespeople responsible for Squared CDO 2007-1, a complex “collateralized debt obligation” of derivatives linked to the mortgage market, to avoid permanent losses, the Securities and Exchange Commission said.

The bank was already looking at a $40 million mark-to-market loss, but decided to press forward with a marketing pitch to institutional clients instead of shutting down the deal, the SEC said, in an effort to avoid greater losses.

Let’s add some perspective: JPM has nearly four billion shares outstanding so this fine works out to less than four cents per share. Just the news of the resolution of the issue helped the stock gain 43 cents per share yesterday.

The real danger is how much the bank is exposed to future lawsuits.

Posted by on June 22nd, 2011 at 8:34 am


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

Tickers: