Bank CEO thinks journalist salaries are 'outrageous'

I did miss your point.

The financial services business is very real. If you have ever used a credit card, gotten a mortgage, written a check, had money in a money market account, etc. then you really are familiar with what a company like JP Morgan Chase does. No, it's not iPhones or widgets. But we don't just live in a tangible assets world. Financial services companies are the glue that allow us to do our financial transactions more easily than ever. And that doesn't just apply to consumers, because as I pointed out, JP Morgan is largely abandoning consumer/branch banking, due to the regulatory hurdles that have been thrown up. What they do also allows businesses to operate on a day to day basis. Their services are vital to those operations, and its a pretty profitable business for them.

As for the Tribune bankruptcy, correct me if I am wrong please (and I may be), but JP Morgan would have been a secured creditor. As a secured creditor they have a security interest over some or all of the Tribune's assets. In another words, as a bank they made a loan in return for collateral.

I haven't followed what is going on with the Tribune. Have they even finalized terms of that bankruptcy? It's been dragging on for years.

If they haven't, and JP Morgan is a senior creditor holding secured debt, what makes you say they made a terrible decision?

They made a business loan. They secured collateral in return. That is the business they are in. Whatever the outcome of a bankruptcy, unlike unsecured creditors and equity holders, they have a claim for everything they are owed and when the assets are divied up, they will be the first paid (in whatever terms the bankruptcy goes through. I am guessing they might accept a debt for equity swap, but I don't know if that is the case).

Why is a collateral-based loan a terrible decision? Am I missing something?

 

However you feel about this, Dodd-Frank has made it so they really don't want your business under the conditions they are being forced to operate under. So you may not have to worry about experiences with Chase much longer (or any bank), unless you are OK with never seeing a human, banking only via ATM and computer, and paying up front fees on your checking account to cover the cost they incur from you and to offset the government price-fixed fees set on transactions, such as those for debit car swipes.

Those were costs you could have avoided in the past, because of the fees they collected from others because of things like overdrafts, bounced checks, etc. that allowed them to give free checking and debit cards at a loss, knowing that people would incur other fees that made up the cost and gave them a profit.

 

I'm not arguing with your frustration, JD.

But if someone paid me with a check that bounced, I'd be frustrated by my bank sure. I'd also understand that that bounced check costs them, and that they are passing along the costs. They also are tacking on more of a fee, because traditionally that was how they covered the freebies they gave away at a loss, such as free checking, debit cards, etc. So yeah, I'd be pissed that I got hit with a $10 fee.

But who is responsible? The paper that bounced the check. Was your anger more directed at them? Because they are the ones that owed you $10.