JPMorgan Chase Spends $500 Million On a Data Center 275
1sockchuck writes "JPMorgan Chase spends $500 million to build a data center, according to CEO Jamie Dimon. That figure places the firm's facilities among the most expensive in the industry, on a par with investments by Google and Microsoft in their largest data centers. Dimon discussed the firm's IT spending in an interview in which he asserts that huge data centers are among the advantages of ginormous banks. Dimon also offered a vigorous defense of the U.S. banking industry. 'Most bankers are decent, honorable people,' Dimon says. 'We're wrapped up in all this crap right now. We made a mistake. We're sorry. It doesn't detract from all the good things we've done. I am not responsible for the financial crisis.'"
Re:Oh, shut up (Score:5, Interesting)
And it's not like this particular fellow, Jamie Dimon, just got involved in the sector. He's got a long history [wikipedia.org] doing all sorts of stuff, some of it more on-the-up and some of it more questionable.
Break up the big banks and... (Score:4, Interesting)
reinstitute Glass-Stegall, preventing conglomerates of investment banks with commercial lenders backed by government-insured savings and checking accounts. And the assembling of massive coast-to-coast financial supermarkets like Bank of America and Citibank should never have been approved by Federal regulators under the Clinton and Bush administrations.
Dimon and JPMC actually proves the rule. After the 2008 banking crash and TARP fiasco, Dimon was anointed as proof that not every big bank CEO was a bad egg. (Although JPMC accepted TARP money, they did so because Henry Paulson asked them to, not because they necessarily needed it). Jamie Dimon, said John McCain and many others, was old school and took his responsibilities to the world economy and banking industry seriously.
Obviously, not seriously enough in the face of the non-ending quest for superior returns and mind-blowing take home pay.
Who cares? (Score:4, Interesting)
'Most bankers are decent, honorable people,'
Being decent and honorable isn't worth shit if the institution they work for is monstrous.
That's what it boils down to, at the end of the day. They internalised the profits and externalised the losses as best they could. They would have blown that bubble up for eternity if they could have, and paid no heed to the consequences. They want every cent you have, no less. Regulation kept them in chains, and now those chains are broken.
What we've witnessed is 30 years of large financial institutions gradually being allowed to do exactly what the fuck they want. Naturally, the monster devoured so much, so greedily, and took such monumental risks that it took merely a few years of true excess for it to ignite the biggest world slump since 1929. It didn't learn from then, it didn't repent or change its ways, and you can be sure as hell that it hasn't learned now. The devastation it wrought will happen again and again, simply because destruction is all it knows.
In light of that grim reality, who gives a toss how decent they are as individuals.
How is this necessary? (Score:4, Interesting)
"We were a port of safety in the storm."
“It’s a free. Fucking. Country.”
This article really makes me angry. Who does this support other than the IT industry that supplies them with 500 Million in servers, networking equipment & infrastructure?
What is this data center going to do? A grad student could design a decent database system for trades and banking. So they now have a 500 million $ data center, are they now going to use that scrape a few more milliseconds off there HFT's or the associated algorithm's? Are they going to figure out the optimal market strategy to beat there competitors? They can't possibly have enough data to fill something like that, so it has to computation power, right?
How does this contribute to society other than support an electric company? Don't give me liquidity bullshit.
Separate your banking from investing and then we can talk about how "banks" like this isn't a plague on society. /rant
Re:Huh. (Score:5, Interesting)
Yeah ProPublica is wrong. It's called an accounting trick. Borrow money from the government in loan #2, and then pay back the government on loan #1 (TARP). General Motors pulled the same schenanigans when it claimed to "pay back" the loans, but in fact is still deep in debt to the government.
It's reminiscient to how a certain president (I'll let you guess) claimed to "put 100,000 more cops on the street". In reality the law said 100,000 cops or 100,000 cop-equivalents... like new computers. Most departments spent the money on computers and only hired an additional ~500 actual cops.
When you listen to a politician or CEO or marketer you have to realize they are not lying to you. Instead they are redefining words on the fly (a "cop" is not really a cop... could be a computer), or omitting crucial information (we paid TARP, but we borrowed money to do it).
Re:Huh. (Score:5, Interesting)
Re:Huh. (Score:5, Interesting)
They got a fair interest rate. They borrowed $25B, and paid it back 7 months and 20 days later. The revenue to the government was $1.7 B.
It was preferred stock with a 5% dividend, with warrants attached. This basically means the banks sold stock to the government with a required, 5% dividend. The government also received warrants, which allow them to purchase additional common stock at a predetermined price (These warrants were dilutive, that is, existing shareholders pay for the government's profit when they are exercised). The banks "repaid" the loans by buying back the preferred stock. The government was then left with the ability to buy shares of the banks at a discount if their stock performed well (If the share price was greater than the exercise price of the warrants, the government would purchase the shares at a discount).
TARP was certainly not a sweetheart deal. Bernanke and Paulson (Not Geithner) sat in a room and basically said they were going to offer the banks the loans, but it was all or nothing. If anyone refused to take the loans, no banks would be able to borrow. Any bank that had refused would have gone down in history as "The bank that vetoed the bailout." Payback was also forcibly delayed. The idea was that if half of the banks took loans and half didn't, the market would panic, selling the banks that took loans and buying the banks that didn't. This would have caused the bailout to fail immediately, and, in fact, have the opposite of the desired effect.
I guess to answer your question; yes, I have an opinion.
Re:Line Item (Score:4, Interesting)
Holy shit you're a brainwashed idiot.
1) Nobody makes money making sub-prime loans. It's trivial for any idiot to understand that loaning money to people who can't pay it back is a dumb idea.
This is why Mitt Romney won't be inviting you to his inauguration. You don't know how to think like a high-flyer. I know a bank that specialized in subprime loans. They, in fact, sold off the good ones because the subprimes were their cash cows.
Banks don't make money off the principal. They make it off the interest, which on a 30-year mortgage would typically exceed the principal and more. In fact, one of the old Carter-era loans at 10% on 30,000 would end up costing the mortagee over $100K.
But what good does that do when people don't pay back? No good at all, if, in fact, they don't pay. But few people actually take out a loan with the express intent of defaulting on it and trashing their credit rating, they try very, very hard to keep paying. But if they're closer to the bottom 1% than the top 1%, they will frequently fall behind and that's where the subprime advantage kicks in. ZING! Late fees and penalties. Even MORE income on top of the returning principal and the mortage interest and servicing fees. Suddenly subprime doesn't look so bad after all. The same old story. The richer you are, the cheaper you can live - no need to resort to payday loan roulette or usurious auto title loans if you're a 1-percenter.
It's only when the economy completely tanks and people give up on repayment entires and the (foreclosed) home prices deflate that subprime actually starts to look bad from the loan servicer's point of view.
Dimon should go to jail! (Score:5, Interesting)
Perhaps he's sorry that, as one of the biggest crooks in the world, he didn't go to jail? Or maybe he's sorry about the wash trading he did, and that he got only a 30k fine, for manipulating the crude oil markets? Or probably, he is sorry for JP-Morgan naked short selling on the Silver market? Or for emitting more bonds of Silver than they physically have? Or...
Come on, we all know what these data centers are for. They are for doing high frequency trading. It's been a long time that we all know such trades are destroying more wealth than it creates.
Such declaration is simply outrageous. We're tired of the financial terrorists. None have been punished, yet destroying jobs and lives by the millions, and proves of that accumulating. This one day will stop, once the general public understands what is going on. They'd better have strong necks when that day comes, because probably, their head will go off, just like in the French revolution.
In the mean time, since the people have lost their power over this disgusting "elite", everyone should play on the same game, and buy (physical) silver coins. Not only this is a very good investment, especially considering today's record low, but this also has the side effect of crashing JP-Morgan, since (as I wrote above) they did very dangerous bets, and already lost billions. As Max Keiser puts it: "GO GO! Silver liberation army!"