Dear Mr. Berko:

Dear F.S.:

Banks made galactic fortunes in the housing, mortgage and consumer spending booms during the last dozen years by sucking the marrow from the bones of the American middle class (AMC). There was glitter in the air; revenues and earning seemed limitless as bankers danced like gypsies in a celebratory carnival of riches. The Dow Jones industrial average boomed, billions in bonuses were paid, 401(k) plans became flush, dividends exploded and balance sheets became fat.

“Those were the days, my friend,” as the song goes. “We thought they’d never end.” But they did, and the Ponzi scheme collapsed.

The big banks, including Wall Street’s investment banks, created a financial earthquake of nearly 10 on the Richter scale. Bank revenues and earnings collapsed; share prices, dividends and balance sheets imploded; the economy cracked while trillions of dollars of value, personal dignity and hope plunged into the widening fissures.

The government lavished TARP funds to keep the big banks solvent, but the AMC was sliced at the jugular and bled buckets. Millions of AMC homes entered foreclosure; 8.7 million AMC workers lost their jobs, their credit and their honor, plus the silly notion that they were part of the American dream. Thanks to the open, excessive greed of Citigroup, JPMorgan, Bank of America, etc., the AMC is drowning in despair. This huge, wonderful middle class, the DNA of our labor force, the spine of our economy, whose spending represents 71 percent of our gross domestic product, has been reduced to poverty.

JPMorgan Chase & Co.’s (JPM-$45.04) earnings will be record-setting in 2011 at $4.56 per share, up 14.9 percent from last year’s $3.95. One of the reasons for this sparkling growth is the onerously higher fees skimmed from the credit and debit cards of the AMC. JPM is now considering an increase of its debit card fee to $5 per month from $3 per month.

Then JPM wants to limit your debit card purchases to $50 per swipe. Today, JPM charges you or the merchant 44 cents for each debit card swipe. For example, if you purchased a $250 TV yesterday, the merchant makes one swipe for $250, charging you or the merchant 44 cents. But because the swipe limit is lowered to $50, the merchant must swipe the debit card five times when you buy that $250 TV, increasing JPM’s income on that transaction fivefold to $2.20. So the AMC gets kicked in the butt once again by JPM.

The AMC will get kicked again when JPM begins to charge all its customers $3 each time they make a withdrawal from a JPM ATM.

Though I believe the dividend and book value will increase, I would not buy the stock. Though I believe JPM has an above-average potential return for the next three to five years, I would not own the shares.

Please address your financial questions to Malcolm Berko, P.O. Box 1416, Boca Raton, Fla. 33429 or email him at malber@adelphia.net. ©2011 Creators.com