JP Morgan Chase

John Gapper

The US investigation into JP Morgan Chase having hired the children of well-connected officials in China is one of those events that threatens to up-end a business practice that is long-established and widespread, yet hard to justify when it is placed under a harsh spotlight.

The problem is at least as much for China itself as for the Wall Street banks and financial institutions that have followed the local practice by trying to get themselves some good connections. It speaks to the justified resentment of many Chinese at the way the elite “princeling” class accrues wealth.

As it happens, the investigation has emerged in the same week that Bo Xilai goes on formal trial on charges of bribery, corruption and abuse of power. Mr Bo’s downfall was a catalyst in exposing the extreme internal strains within the Chinese leadership caused by such issues. Read more

When Goldman Sachs bought the commodity trading house J Aron in 1981, it also took on Lloyd Blankfein, then a salesman of silver coins. Thirty-two years later, Mr Blankfein is Goldman’s chairman and chief executive and the bank owns, among other commodity assets, some aluminium warehouses near the ailing city of Detroit.

John Gapper

How well is Wall Street doing? That depends on whether you are looking at their results as a casual observer, or a shareholder.

This is turning into one of the best earnings seasons on Wall Street since 2009, when banks made a rapid recovery from the 2008 crisis. Not only were they bailed out but supported by ultra-low interest rates and official backing for troubled assets. Read more

US chief executives are beginning to wean themselves from their perplexing attachment to the role of chairman. But at a few large banks, the addiction persists.

John Gapper

In a sense, the complaint brought against JPMorgan Chase for bad behaviour in the mortgage market is history. It concerns Bear Stearns, the ill-fated investment bank acquired by JPMorgan in spring 2008 as the financial crisis broke out.

But the suit from Eric Schneiderman, the New York attorney-general, which is part of a broader regulatory initiative to crack down belatedly on mortgage securitisation abuses, is still a fascinating portrayal of how bad things got. Read more

John Gapper

London is acquiring a dangerous reputation for US financial institutions.

The financial crisis in 2008 was set off by the London-based derivatives unit of American International Group, which was insuring potential losses for banks. Now, JP Morgan Chase finds itself in trouble over a $2bn hedging/trading loss in London. Read more