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JPM Crashing After It Convenes Emergency Call To Advise Of "Significant Mark-To-Market" Losses
ZEROHEDGE ^ | 5-10-12 | Tyler Durden

Posted on 05/10/2012 2:47:31 PM PDT by tcrlaf

Out of nowehere, JPM announced 40 minutes ago that it would hold an unscheduled 5pm call to coincide with the release of its 10-Q. Rumors were swirling as to why. The reason is as follows:

JPMORGAN SAYS CIO UNIT HAS SIGNIFICANT MARK-TO-MARKET LOSSES - "Fortress balance sheet" at least until Bruno Iskil gets done with it. JPMORGAN SAYS LOSSES ARE IN SYNTHETIC CREDIT PORTFOLIO - but, but, net is NEVER, EVER Gross. JPM WOULD NEED $971M ADDED COLLATERAL IF RATINGS CUT ONE-NOTCH JPM WOULD NEED $1.7B ADDED COLLATERAL IF RATINGS CUT 2 NOTCHES - how about three notches? JPMORGAN: MAY HOLD SOME SYNTHETIC CREDIT POSITIONS LONG TERM - "Level 3 CDS FTW" "As of March 31, 2012, the value of CIO's total AFS securities portfolio exceeded its cost by approximately $8 billion"

As a reminder, the CIO unit is where Bruno Iksil was making $200 billion-sized bets. Basically JPM has suffered massive losses at its CIO group most likely due to its IG/HY positions held by Iksil.

(Excerpt) Read more at zerohedge.com ...


TOPICS:
KEYWORDS: bank; jpmorgam; obama; qe
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WHAT??? How can this be??? They just passed the Fed Stress Test with flying colors?! Who knew those big bets on Greek Bonds might go bad? The EU/FED was going to make everybody good, right?

LORDY, LORDY, PRAISE THE MESSIAH! It's a good thing the Obama economy is so strong, and we won't need QE3! (OOPS)

1 posted on 05/10/2012 2:47:33 PM PDT by tcrlaf
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To: tcrlaf

This will be another AIG type disaster. Our banks will ‘need’ help because European ones owe them. The open market will close up again, because no one trust another for good reason. Enter Uncle Ben to the rescue.


2 posted on 05/10/2012 2:49:56 PM PDT by Theoria (Rush Limbaugh: Ron Paul sounds like an Islamic terrorist)
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To: tcrlaf

Mark to market....LOL!


3 posted on 05/10/2012 2:50:17 PM PDT by stephenjohnbanker (God, family, country, mom, apple pie, the girl next door and a Ford F250 to pull my boat.)
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To: Theoria

Dimon is telegraphing to Bernanke that JPM needs a BILLION DOLLARS more in liquidity (free taxpayer money) if they get down-graded by the ratings agencies because of this.

FIRE UP THE PRINTING PRESSES, here comes QE3!


4 posted on 05/10/2012 2:54:25 PM PDT by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: tcrlaf

keep their filthy mitts out of the taxpayer cookie jar!!!!


5 posted on 05/10/2012 2:54:41 PM PDT by elpadre (AfganistaMr Obama said the goal was to "disrupt, dismantle and defeat al-hereQaeda" and its allies.)
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To: elpadre; All

Details slowly leaking.
Losses of $4.2 Billion “reasonably possible.”

Get ready to pony up, kids! Your future has to save Obama’s election, now!


6 posted on 05/10/2012 2:56:06 PM PDT by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: tcrlaf

Let ‘em die....enough is enough.


7 posted on 05/10/2012 2:56:29 PM PDT by dfwgator (Don't wake up in a roadside ditch. Get rid of Romney.)
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To: stephenjohnbanker

” Mark to market....LOL! “

Heaven forbid that all of the ‘big banks’ carry these assets on their books at their real (liquid) value...

All that honesty would surely bring the whole ‘too big to fail’ system down....

(By the way - doesn’t the FED hold untold billions of these inflated ‘assets’???)


8 posted on 05/10/2012 2:57:15 PM PDT by Uncle Ike (Rope is cheap, and there are lots of trees...)
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To: tcrlaf

How is the SP500 futures market doing right now?


9 posted on 05/10/2012 2:57:16 PM PDT by forgotten man (forgotten man)
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To: tcrlaf
hunh. I had to double check the date on this. I'm sure I expressed marvel that JPM had managed to be a Citi clone without suffering Citi's fate. But that was a long time ago and I gave up on it.

I have a feeling that the Obama admin will say, "drop dead, Jamie!" and that means that Tim can parcel it up to his buddies like they did with Bear.

10 posted on 05/10/2012 2:57:29 PM PDT by the invisib1e hand
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To: Uncle Ike

This has GREEK SWAPS written all over it...
And explains the Goldman-Sachs call for MORE QE on Friday.

To answer your other question, it came out Monday that the FED was holding $177 BILLION in “Other assets”.

TRANSALTION: Stocks the FED has been propping for the last 5 months.


11 posted on 05/10/2012 2:59:38 PM PDT by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: elpadre
keep their filthy mitts out of the taxpayer cookie jar!!!!

keep their filthy obamas out, too.

12 posted on 05/10/2012 3:01:35 PM PDT by dfwgator (Don't wake up in a roadside ditch. Get rid of Romney.)
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To: the invisib1e hand

“I have a feeling that the Obama admin will say, “drop dead, Jamie!””

This is LOSE-LOSE for Obama, no matter which way it goes.

The FED tried has tried to postpone the crash, and to prop things past the election. Doesn’t look like, tonight anyway, that it’s going to work out that way.


13 posted on 05/10/2012 3:01:55 PM PDT by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: tcrlaf

Bfl


14 posted on 05/10/2012 3:02:37 PM PDT by liberalh8ter (If Barack has a memory like a steel trap, why can't he remember what the Constitution says?)
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To: dfwgator

“The Era of Bailouts IS OVER!” Barack Obama, 2010


15 posted on 05/10/2012 3:05:01 PM PDT by tcrlaf (Election 2012: THE RAPTURE OF THE DEMOCRATS)
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To: kalee

bump


16 posted on 05/10/2012 3:06:32 PM PDT by kalee (The offenses we give, we write in the dust; Those we take, we engrave in marble. J Huett 1658)
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To: tcrlaf

Obama’s STASH, baby! We’re all gonna be RICH! Woo-hoo!!!!/sarcasm;)


17 posted on 05/10/2012 3:07:18 PM PDT by Frank_2001
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To: forgotten man
How is the SP500 futures market doing right now?

down 11.4, dow -91, as you know doubt know by now.

Don't get me started on this.

2 bil is a relatively small amount of money for such a huge operation. Can this be the one time that "big harvests [don't] get bigger?"

18 posted on 05/10/2012 3:09:14 PM PDT by the invisib1e hand
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To: Frank_2001

Oh, yeah. Isn’t JPM where they found all of MF Global’s “missing” centi-millions?


19 posted on 05/10/2012 3:10:20 PM PDT by the invisib1e hand
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To: tcrlaf

What’s that about reserve requirements? Oh, you dont have money, you paid out bonuses. Ok, fine. Good for you, but you don’t have money to cover your potential loses?


20 posted on 05/10/2012 3:10:51 PM PDT by Theoria (Rush Limbaugh: Ron Paul sounds like an Islamic terrorist)
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To: Theoria
What’s that about reserve requirements? Oh, you dont have money, you paid out bonuses. Ok, fine. Good for you, but you don’t have money to cover your potential loses?

Like in Goodfellas, "F U, Pay Me!"

21 posted on 05/10/2012 3:11:57 PM PDT by dfwgator (Don't wake up in a roadside ditch. Get rid of Romney.)
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To: tcrlaf

Hmmm.....


22 posted on 05/10/2012 3:14:19 PM PDT by Vendome (Don't take life so seriously, you won't live through it anyway)
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To: Uncle Ike

What’s funny is all the regs put in place were suppose to end this crisis.

Time for another crisis.

Oh for Crisis sake.


23 posted on 05/10/2012 3:15:57 PM PDT by Vendome (Don't take life so seriously, you won't live through it anyway)
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To: Vendome

24 posted on 05/10/2012 3:17:05 PM PDT by dfwgator (Don't wake up in a roadside ditch. Get rid of Romney.)
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To: the invisib1e hand
Oh, yeah. Isn’t JPM where they found all of MF Global’s “missing” centi-millions?

Yes, and this is obviously the real reason the money got stolen.

25 posted on 05/10/2012 3:18:37 PM PDT by Vince Ferrer
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To: elpadre
keep their filthy mitts out of the taxpayer cookie jar!!!!

Foolish peon! Don't you know it's their cookie jar? They just allow us to fill it!

26 posted on 05/10/2012 3:19:04 PM PDT by Hugin
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To: dfwgator

Obama blames this on Bush/Romney/Wall Street in 5...4...3...2...


27 posted on 05/10/2012 3:19:18 PM PDT by TexasNative2000 (Jimmy Carter's incompetence + Richard Nixon's paranoia = Barack Obama)
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To: tcrlaf

We need a preemptive Tea Party press release, No Bailouts!


28 posted on 05/10/2012 3:26:20 PM PDT by Vince Ferrer
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To: Frank_2001

29 posted on 05/10/2012 3:29:00 PM PDT by tomkat ( FU.baraq <font finger=middle>)
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To: tcrlaf
0 bummer's answer

Too
Big
To
Fail

30 posted on 05/10/2012 3:30:58 PM PDT by Arrowhead1952 (It's time to take out the trash in DC.)
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To: tcrlaf
I have to plead ignorance. The whole article is Greek to me. Please translate.
31 posted on 05/10/2012 3:34:23 PM PDT by shatcher
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To: Arrowhead1952

Trust
Bernanke
To
Fund.


32 posted on 05/10/2012 3:34:34 PM PDT by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: tcrlaf

The noise should bring gas prices down a whole dime or so. Tourists, laden with government incomes, will all drive out at once to spend their debt in our “service economy” and elicit more loans from Uncle Jintao. Keep the USD artificially high for our idle political regulator class. Have fun. Enjoy the slide. Don’t mention our lack of manufacturing.


33 posted on 05/10/2012 3:35:39 PM PDT by familyop ("Wanna cigarette? You're never too young to start." --Deacon, "Waterworld")
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To: Uncle Ike

Here is the problem. What is the real value? A mortgage that is current is a contract and the value of the contract is what the home owner agreed to pay, not the underlying value of the asset.

However, if it is show that the contract is not being followed (late payments, etc) then the contract is devalued down to a new level. What is that new level? Mark to market establishes the current value of that contract as the current retail value of that asset.

But the value of a house that just sold in the neighborhood is not likely to be the value of that asset. There is now cost associated with administration of the sale of that asset. The proper way should be to value the asset lower than current market by some amount that represents the cost of selling that asset.

I am of the opinion that valuation should be mark to contract until the home owner falls behind. Then mark to less than market (say 10% less) once there is a late payment of say 60 days or more.


34 posted on 05/10/2012 3:35:46 PM PDT by taxcontrol
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To: DuncanWaring

Isn’t the Morgue Bernanke’s designated silver market manipulator?


35 posted on 05/10/2012 3:38:02 PM PDT by Neidermeyer
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To: TexasNative2000

A CYA memo will not suffice this time! HooRah!


36 posted on 05/10/2012 3:38:22 PM PDT by willibeaux (de ole Korean War vet age 82)
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To: tcrlaf

This seems to me like the biggest news all day, all week, bigger than anything on breaking news. Am I wrong, right? The repercussions of this would affect all other stories.


37 posted on 05/10/2012 3:39:10 PM PDT by OldNewYork
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To: shatcher

I’m no financial wizard, but I think the brown stuff is about to hit the fan.


38 posted on 05/10/2012 3:42:56 PM PDT by willibeaux (de ole Korean War vet age 82)
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To: tcrlaf

conference call shortcut .. http://bit.ly/KTDygZ


39 posted on 05/10/2012 3:43:54 PM PDT by Neidermeyer
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To: tcrlaf
Time to dust this one off:

Jump You F*#kers

40 posted on 05/10/2012 3:44:44 PM PDT by FReepaholic (Stupidity is not a crime, so you're free to go.)
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To: tcrlaf
You guys prove there is a sucker born every minute. In 2011 JPM netted nearly $17 billion in profit. Even the high end number of $4.2 billion is a fraction of last year's net.

Do a LITTLE homework before you post about bailouts and Armageddon.

41 posted on 05/10/2012 3:45:02 PM PDT by LRoggy (Peter's Son's Business)
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To: tomkat

She was smarter or better-informed than the rest of us. Where did it come from? He borrowed it.


42 posted on 05/10/2012 3:45:02 PM PDT by expat2
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To: tcrlaf

JPM closed with a .25% gain.

Then at 4:02, it was down $2.79 or 6.85%.

JPMorgan Chase & Co. JPM-NYSE 40.74 0.10(0.25%).

4:02PM EDT|After Hours: 37.95 2.79 (6.85%) 6:45PM EDT - Nasdaq Real Time Price.

How may investors not in on the reality bought JPM before it started to head down south?


43 posted on 05/10/2012 3:49:21 PM PDT by Grampa Dave (ILLEGAL IMMIGRATION IS DESTROYING AMERICA-LOOK AT WHAT IT DID TO THE WHITE HOUSE!)
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To: tcrlaf
Well I hope I don't get screwed in the process. That Outfit sits on the Va backed mortgage to my house and property. Payments are current and always have been and I have dropped below the point where I don't have PMI (private Mortgage Ins. anymore. JP has been sending me second day air (UPS letter) wanting me refinance because they will give me a 2 point better rate for “FREE” there is no such thing as a “free lunch”, In the trash it goes. When that doesn't work they call, I ignore them. Seems that they want to put the loan back to 30 years so they can make more money. They don't say that up front but it isn't too hard to figure out their scam. F them!
44 posted on 05/10/2012 4:00:19 PM PDT by mongo141 (Revolution ver 2.0, just a matter of when, not a matter of if!)
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To: tcrlaf

On Fox right now. Big concerns . Maybe up to 4.2 Billion. JP Morgan was considered the safest bank.


45 posted on 05/10/2012 4:04:44 PM PDT by CaptainK (...please make it stop. Shake a can of pennies at it.)
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To: willibeaux

is it brown or baby diaper yellow?


46 posted on 05/10/2012 4:09:24 PM PDT by elpadre (AfganistaMr Obama said the goal was to "disrupt, dismantle and defeat al-hereQaeda" and its allies.)
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To: tcrlaf

JPM and GS are two banks with friends in very high places. Like how about the treasury and the FED and the SEC, and Congress and on and on. Does anyone think that JPM will not get whatever they need from the US tax payer via the back door. They all have been right along.


47 posted on 05/10/2012 4:09:33 PM PDT by Revel
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To: tcrlaf

Meanwhile the kenyan muslim in chief is giving billions to his muzzy brotherhood and paliscum terrorists.


48 posted on 05/10/2012 4:18:23 PM PDT by soycd
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To: tcrlaf

Soros sold off most of his shares last year. Nothing to see, move along.


49 posted on 05/10/2012 4:23:26 PM PDT by bgill
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To: tcrlaf

One more thing. JPM is the bank that it is rumored to have received much of that missing MF Global customer money in the wee hours before they declared bankruptcy. They should have to pay that back too.


50 posted on 05/10/2012 4:29:26 PM PDT by Revel
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