Jumped time?

1991 Grand Marquis - 112,000 miles - 5.0 dual exhaust - I was given this car after it overheated on the freeway. After pressure washing the engine compartment, it was obvious that the water pump had failed (literally broken at the heater hose). I replaced the pump but found that the engine ran poorly. Suspecting a head gasket, I took a compression check and found that all cylinders were within specs with the lowest at 115 and the highest at 140. Judging by the way the car turned over and ran when it would finally start, I then suspected that it had jumped time. I have now found after dismanteling that it has not jumped time but that the timing chain is very loose (great deal of play)And the marks are not exactly lined up (very small difference,maybe 1/8" to 1/4"

. Could this be the reason that this car runs the way it does? Or did I miss something? Thanks, I will donate to the cause...