Sunday, February 7, 2016


In 2011 it was reported that Wells Fargo had assets in the neighborhood of $1.26 trillion. This amount was the equivalent to about 8% of U.S. GDP. In 2016 the amount of assets under the control of Well Fargo climbed to about $1.75 trillion. This means, unlike most Americans - who are still climbing out from under the 2008 market collapse - Wells Fargo saw its managed holdings climb about 30% between 2011 and 2016.

Nice. That is, if you're Wells Fargo.

Here's the real fun part. Other banks control even more assets.

Almost five years ago Bank of America and JP Morgan Chase combined had roughly $4.5 trillion in assets. If it's hard to imagine how much money this is take a look at the picture below. Each column is made up of stacked pallets stuffed with $100 bills. Each column represents $1 trillion (the smaller stack to the right represents $420 billion).

Each column above is made up of a base of 100 pallets, which are stacked 100 high. Every row of pallets 
is worth $10 billion (100 x $10b = $1 trillion). The smaller column has 42 pallet bases, worth $420 billion.

Today, Bank of America ($2.15 trillion) and JP Morgan Chase ($2.35 trillion) are still worth a combined $4.5 trillion - or about $80 billion more than what the smallest column shown above reflects.

What this means is that Bank of America and JP Morgan Chase are managing assets that are equivalent to about 25% of what the U.S. economy produced last year (2015 U.S. GDP: $17.93 trillion).

So, yeah, we learned nothing from 2008. If one or two of these banks go under we're all in trouble. Again.

- Mark

P.S.: If you want a visual of how these pallets are stacked click here.

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