JPMorgan hoards cash as Dimon expects rates to rise

Reuters2021-07-15

NEW YORK (Reuters) - Jamie Dimon's optimism about the economy is costing JPMorgan Chase & Co money, the bank's latest financials show. The CEO said this week the country's largest lender continues to ...

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Comments

Doge2theMoon
2021-07-19
Doge2theMoon
Cash is optionality.
BestHenry
2021-07-15
BestHenry
Cash is king
Flashtrade
2021-07-15
Flashtrade
Comment
- Flashtrade:
  Sgare
- Flashtrade:
  Share
- Flashtrade:
  Share
- Flashtrade:
  AGree
Flashtrade
2021-07-15
Flashtrade
Like
Jade78
2021-07-15
Jade78
Only time will tell. Jimmy Dimon is honest enough to say that he doesn’t know how the stock market will pan out. Keep some cash in case….
- KRPK:
  Yes when the time is right, cash in hand will be handy
- zcml:
  Like thx
Ke1991
2021-07-15
Ke1991
okok
- zcml:
  Like thx

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Jamie Dimon's optimism about the economy is costing JPMorgan Chase & Co money, the bank's latest financials show.\nThe CEO said this week the country's largest lender continues to stockpile cash instead of investing it in securities, such as U.S. Treasuries and mortgage-backed bonds, which pay more than cash deposits.\nHow the country's largest lenders manage an unprecedented glut of cash weighing down their balance sheets will be important in separating winners from losers in coming quarters as uncertainty grows over the inflation and interest rate outlook, according to analysts.\n\"The balance sheet mix will be a key driver for the stocks as we move into 2022,\" David Konrad, an analyst at Keefe, Bruyette & Woods, wrote in a recent report to clients.\n\"In our view, the risk/reward favors holding cash and under- earning in this environment.\"\nJPMorgan is waiting for the chance to buy securities with higher yields once exceptionally strong economic growth kicks in and drives up inflation and interest rates, Dimon and Chief Financial Officer Jeremy Barnum told analysts on Tuesday.\n\"You may have growth in the second half this year that's stronger than it's ever been in the United States of America,\" Dimon said in a call with analysts on Tuesday.\nThe yield on 10-year Treasury notes, at around 1.35% versus 1.75% in March, could climb to 3%, Dimon added.\nDimon's comments came after JPMorgan posted quarterly financials on Tuesday that showed its average cash balance held on deposit at central and other banks increased by $89.6 billion while it added only $2.6 billion of investment securities.\nJPMorgan made 0.06% on its cash while its securities paid 1.31%, its reports showed.\nIn contrast, $Bank of America Corp(BAC-N)$'s results released on Wednesday showed it has let its cash decline by $31 billion while it added $107.3 billion to its securities holdings.\n\"The reality is that we generated $80 billion deposit growth, and we've got to put it to work,\" CEO Brian Moynihan told analysts. \"We're not timing the market or betting.\"\nJPMorgan's deposits grew by nearly $100 billion during the quarter.\nTRADE-OFFS\nCash from government stimulus and Federal Reserve programs continues to pour into the financial system, dampening demand for bank loans.\nU.S. financial markets are also wrestling with a spike in inflation, which they believe could prompt the U.S. Federal Reserve to raise interest rates.\nDuring this quarter, analysts have pressed bank executives about their cash and securities mix because of how important it is for profits. 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optionality.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/173617308","repostId":2151529580,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":147274517,"gmtCreate":1626361589639,"gmtModify":1703758756687,"author":{"id":"4087883379425460","authorId":"4087883379425460","name":"BestHenry","avatar":"https://static.tigerbbs.com/fb02013d79e46c203e3d6a7f85d2857e","vip":1,"crmLevel":3,"crmLevelSwitch":0},"htmlText":"Cash is king","listText":"Cash is king","text":"Cash is 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time will tell. Jimmy Dimon is honest enough to say that he doesn’t know how the stock market will pan out. Keep some cash in case….","listText":"Only time will tell. Jimmy Dimon is honest enough to say that he doesn’t know how the stock market will pan out. Keep some cash in case….","text":"Only time will tell. Jimmy Dimon is honest enough to say that he doesn’t know how the stock market will pan out. Keep some cash in case….","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":4,"commentSize":2,"repostSize":0,"link":"https://ttm.financial/post/147845495","repostId":2151529580,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":5229556,"gmtCreate":1626355273853,"gmtModify":1663231013951,"authorId":3554952819125110,"author":{"id":3554952819125110,"authorId":3554952819125110,"name":"KRPK","avatar":"https://static.tigerbbs.com/881610765cd032fe6e1b38c240a49844","vip":1,"crmLevel":4,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":147845495,"type":1,"supId":0,"prevId":0,"content":"Yes when the time is right, cash in hand will be handy","text":"Yes when the time is right, cash in hand will be handy","html":"Yes when the time is right, cash in hand will be handy"},{"id":5229303,"gmtCreate":1626353500885,"gmtModify":1663231012946,"authorId":4088490026197220,"author":{"id":4088490026197220,"authorId":4088490026197220,"name":"zcml","avatar":"https://static.tigerbbs.com/282fc713a264eae65e8d4ae7f74b3395","vip":1,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":147845495,"type":1,"supId":0,"prevId":0,"content":"Like <u>thx</u>","text":"Like <u>thx</u>","html":"Like <u>thx</u>"}],"langContent":"EN"},{"id":147842359,"gmtCreate":1626352901371,"gmtModify":1703758454861,"author":{"id":"4087720904797660","authorId":"4087720904797660","name":"Ke1991","avatar":"https://static.tigerbbs.com/58f1461ca18e85868a39dec883897eef","vip":1,"crmLevel":1,"crmLevelSwitch":0},"htmlText":"okok","listText":"okok","text":"okok","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":3,"commentSize":1,"repostSize":0,"link":"https://ttm.financial/post/147842359","repostId":2151529580,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"comments":[{"id":5229307,"gmtCreate":1626353510618,"gmtModify":1663231011644,"authorId":4088490026197220,"author":{"id":4088490026197220,"authorId":4088490026197220,"name":"zcml","avatar":"https://static.tigerbbs.com/282fc713a264eae65e8d4ae7f74b3395","vip":1,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[]},"repliedAuthorId":0,"objectId":147842359,"type":1,"supId":0,"prevId":0,"content":"Like <u>thx</u>","text":"Like <u>thx</u>","html":"Like <u>thx</u>"}],"langContent":"EN"}],"isCommentEnd":false,"newsSizeData":{"likeSize":103,"commentSize":16,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.24.2","shortVersion":"4.24.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2151529580"}