Sallie Krawcheck, the former President of Merrill Lynch Wealth Management was just on Bloomberg talking banking with Tom Keene and Brad Hintz of Sanford Bernstein.
And these days, you can’t talk banking unless you talk about JP Morgan’s massive $2 billion (and counting) trading loss. In case you’ve been under a rock, you know that these losses occurred in their London Chief Investment Office and went undetected for quite a while.
So here’s what Krawcheck had to say about it:
“There’s no doubt,” said Krawcheck, “that these banks have taken more risk that we as a nation and we as an industry would like them to.”
The amount of risk, she went on to say, is a problem because it seems no one can track it.
“The size of the JP Morgan loss in some ways is no big deal, but the fact that they didn’t know about it…”
That’s the rub, guys. Wall Street is biting off more than it can chew.