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JP Morgan’s Dimon sees financial stress similar to the global financial crisis ahead

  
  Analysis
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Jamie Dimon is chief executive officer of JPMorgan Chase & Co.

On the coronavirus pandemic:
  • “At a minimum, we assume that it will include a bad recession combined with some kind of financial stress similar to the global financial crisis of 2008” 
  • More specifically for his firm, JPM earnings this year will be “down meaningfully”
  • 180,000, or about 70%, of the firm’s employees are working from home
  • JPM is paying around $1,000 to those whose jobs don’t allow them to work remotely
Adds:
  • people could return to work more quickly if governments made tests widely available
  • to determine who has recovered from the disease
  • “The country was not adequately prepared for this pandemic,”

Dimon is correct on the unpreparedness. Three months of denial from the very top of the US administration that there was even a problem has cause such a tragic escalation in the numbers of lives lost.

JP Morgan think progress in US-China talks is unlikely

  
  Analysis
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JP Morgan on the upcoming talks between the US and China.

  • We are more sceptical
  • still see risks to our growth outlook for 2H 2019 skewed to the downside
JPM that a deal could be struck at the ministerial level talks in mid-Oct and “activity get a cyclical bounce into year end”. But:
  • “Are either likely? No.”
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Based on what we have seen come out of US-China talks so far I find it difficult to disagree with JPM.

Jamie Dimon and Warren Buffett can’t get it right

  
  Analysis
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Jamie Dimon and Warren Buffett can’t get it right

15 months ago Jamie Dimon and Warren Buffett were warning people not to buy bonds. At the time, US 10-year yields were at 3.0%. Today they’re at 1.48%. 30-year yields are now below 2%.
Here’s a look at 30-year futures since:
Jamie Dimon and Warren Buffett can't get it right
They’re up 16% while the S&P 500 and Berkshire Hathaway shares are both flat.
He wasn’t alone. On the same weekend last year, JPMorgan CEO Jamie Dimon was warning about the 10-year rising to 4%.
Dimon
The point here isn’t to point out incorrect calls. I’ve had plenty myself.
It’s a reminder that no one knows the future. Jamie Dimon is going to continue to be the greatest bank CEO of his era while Buffett will remain the greatest investor of all time.
Sometimes you’re wrong. Roll with the punches.

JPMorgan Chase :Markets are overbought

  
Analysis, Economy, Education, US Market
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“Although the SEC fraud case does not have direct implications outside Financials, the rise in uncertainty is negative for equities at a time when equity markets are overbought. Technicals have been pointing to overbought equity markets for some time now and Friday’s correction has the potential to drag the S&P 500 down toward 1175 in the near term. But our technical strategists see very little chance of the S&P 500 falling below 1150, i.e., the January high, over the coming weeks.”

Source: JPMorgan Chase & Co. (Public, NYSE:JPM)

Please note that JPMorgan Chase & Co. (Public, NYSE:JPM) has been dead right on their market calls, as the Pragmatic Capitalist points out in his website, “few of the big banks have traded the recovery as well as JP Morgan. They nailed the reflation trade and they have subsequently been dead right about the reflation trade transforming into the recovery trade. They’ve recommended that investors pile into the highest risk names in the market and its been a winning trade since.”

Charting The Epic Collapse Of The World's Most Systemically Dangerous Bank

  
Analysis, Education
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It’s been almost 10 years in the making, but the fate of one of Europe’s most important financial institutions appears to be sealed.
After a hard-hitting sequence of scandals, poor decisions, and unfortunate events,Visual Capitalist’s Jeff Desjardins notes that Frankfurt-based Deutsche Bank shares are now down -48% on the year to $12.60, which is a record-setting low.
Even more stunning is the long-term view of the German institution’s downward spiral.
With a modest $15.8 billion in market capitalization, shares of the 147-year-old company now trade for a paltry 8% of its peak price in May 2007.

THE BEGINNING OF THE END

If the deaths of Lehman Brothers and Bear Stearns were quick and painless, the coming demise of Deutsche Bank has been long, drawn out, and painful.

In recent times, Deutsche Bank’s investment banking division has been among the largest in the world, comparable in size to Goldman Sachs, JP Morgan, Bank of America, and Citigroup. However, unlike those other names, Deutsche Bank has been walking wounded since the Financial Crisis, and the German bank has never been able to fully recover.

It’s ironic, because in 2009, the company’s CEO Josef Ackermann boldly proclaimed that Deutsche Bank had plenty of capital, and that it was weathering the crisis better than its competitors. (more…)

JPM Develops A.I. Robot To Execute High Speed Trades, Put Humans Out Of Work

  
Analysis, Education
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With high-margin FICC revenues stuck in a secular decline across the financial industry, banks are forced to extract as much profit as possible from existing product lines. Which explains why JPMorgan will soon be using a “first-of-its-kind robot” to do away with carbon-based traders altogether and execute trades across its global equities algorithms business using a “robot”, after a recent trial of JPM’s new artificial intelligence (AI) program showed it was “much more efficient than traditional methods of buying and selling“, the FT reports.

JPMorgan, the world’s biggest bank by revenue, believes it is the first on Wall Street to use AI with trade execution and said it would take rivals 18 to 24 months and an investment of “multiple millions” to come up with similar technology.

 The AI — known internally as LOXM — has been used in the bank’s European equities algorithms business since the first quarter and will be launched across Asia and the US in the fourth quarter, Daniel Ciment, JPMorgan’s head of global equities electronic trading, told the Financial Times.

In the latest victory for robot kind over humans, LOXM’s job will be to execute client orders with maximum speed at the best price, “using lessons it has learnt from billions of past trades — both real and simulated — to tackle problems such as how best to offload big equity stakes without moving market prices.” (more…)

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