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JPMorgan Trading Loss May Reach $9 Billion
NY Times ^ | 6/28/12 | JESSICA SILVER-GREENBERG AND SUSANNE CRAIG

Posted on 06/28/2012 6:34:16 AM PDT by Kartographer

Losses on JPMorgan Chase’s bungled trade could total as much as $9 billion, far exceeding earlier public estimates, according to people who have been briefed on the situation. When Jamie Dimon, the bank’s chief executive, announced in May that the bank had lost $2 billion in a bet on credit derivatives, he estimated that losses could double within the next few quarters. But the red ink has been mounting in recent weeks, as the bank has been unwinding its positions, according to interviews with current and former traders and executives at the bank who asked not to be named because of investigations into the bank.

(Excerpt) Read more at dealbook.nytimes.com ...


TOPICS: Business/Economy; Crime/Corruption
KEYWORDS: jpmorgan
Almost like a government projects and their cost over runs, the 'hole' just gets deeper and deeper and.....
1 posted on 06/28/2012 6:34:22 AM PDT by Kartographer
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To: Kartographer
.

Looks like JPMorgan's analysts have been moonlighting as advisors to Governor Jerry Browns financial staff.... /sarc

2 posted on 06/28/2012 6:43:39 AM PDT by pointsal
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To: Kartographer

“lost $2 billion in a bet on credit derivatives”

When the house can’t win in a fixed game it’s sad...ban all derivatives they have no intrinsic value.


3 posted on 06/28/2012 6:44:16 AM PDT by A Strict Constructionist (We're an Oligrachy...Resistance to tyrants is obedience to God. Thomas Jefferson)
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To: Kartographer

Somebody please remind me...just EXACTLY what does “investment banking” do for We the People?

I think I know what it does for the Feds...but how about the Feds employers?!!!


4 posted on 06/28/2012 6:50:34 AM PDT by mo (If you understand, no explanation is needed. If you don't understand, no explanation is possible.)
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To: Kartographer
But the red ink has been mounting in recent weeks,

Upon further review the official ruling is: COMPLETELY EXPECTED. There will be no drinking on this.

5 posted on 06/28/2012 6:51:16 AM PDT by KarlInOhio (You only have three billion heartbeats in a lifetime.How many does the government claim as its own?)
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To: A Strict Constructionist

the most immediate effect of this will be to get a Fake White Indian elected to the US Senate.


6 posted on 06/28/2012 6:55:17 AM PDT by Buckeye McFrog
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To: Kartographer
Remember, JP Morgan was given 94.7 billion in the 2008 bailout. They've supposedly paid it back. Dimon claims all the losses JP Morgan amassed are covered by assets and do not involve any customer funds. To recap: During a U.S. economic emergency and subsequent recession/depression which required 'loaning' 94.7 billion dollars to JP Morgan, they've managed to pay it all back - plus interest - and amass losses of at least 9 billion and that 9 billion was 'profit'.

Seems to me, we can completely erase our Country's deficit and become financially sound (and then some) just by letting Jamie Dimon handle everything. /s

7 posted on 06/28/2012 6:55:24 AM 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: liberalh8ter

Just to be fair about JP Morgan if my memory is right Paulson and Helicopter Ben forced Dimon to take TARP money. They did not want to have the banks that really needed TARP to become marked so they forced all the big banks to take TARP.


8 posted on 06/28/2012 6:58:37 AM PDT by C19fan
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To: Kartographer

No one who had fiduciary responsibility for the goods of others, and that includes top corporate managers, who at least in theory are supposed to look out for their shareholders, should trade in derivatives, except as a hedge against risk in real investments (equities, bonds, commodities, real estate).

It looks increasingly like neither personal responsibility on the part of fiduciaries nor the influence of shareholders on management suffice to prevent this, so I’m afraid this may actually be a case in which government regulation is warranted. Perhaps the law establishing such regulation should create a classes of corporations and mutual funds that have the phrase “speculative trading” in their names that would be exempt from the rules, so investors who’d like their money managers to take risks on derivatives with their money could do so. But if it does neither banks nor mutual funds nor pension funds should be allowed to invest in “speculative trading” entities, and there should be strict, low limits on the percentage of other corporations’ holdings that can be invested in such enterprises.


9 posted on 06/28/2012 7:02:51 AM PDT by The_Reader_David (And when they behead your own people in the wars which are to come, then you will know. . .)
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To: C19fan

Maybe so but they kept the money for a year. If they didn’t need it, they could have returned it the next day. Call me cynical but I think when the smoke clears, we’ll find out that there was a wealth distribution to big banks. Why else have the elite fought tooth and nail to halt any attempt to fully audit the Fed?


10 posted on 06/28/2012 7:03:59 AM 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: mo

Back in the day, investment banking aided capital formation for businesses and was thus a useful service to the economy as a whole, and thereby indirectly to the citizenry as a whole.

There was a piece less than a year ago written by an investment banker who had resigned a post a Goldman Sachs, in which he lamented that the company had “lost its soul” and that the bankers now referred to clients as “muppets”. The problem, which I had seen from afar, and which that piece confirmed, is that our zeitgeist may be described as “the Era of Bad Stewards” (or as one wag here at FR suggested it be typeset “the Era of BAd STewARDS”): folks who have fiduciary responsibility for the goods of others (like investment bankers, corporate CEOs, Congressmen, university presidents, . . .) all now act as if their positions exist not to serve the good of others, but to enrich themselves. Once that zeitgeist permeates an investment bank, it not only doesn’t do anything for the public good — which was never the point, really — it doesn’t do anything for its clients or shareholders either.


11 posted on 06/28/2012 7:10:17 AM PDT by The_Reader_David (And when they behead your own people in the wars which are to come, then you will know. . .)
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To: liberalh8ter

In defense of the trust, JP Morgan could not give the TARP money back when it wanted to. It had to get approval from the Federal gov’t and Reserve. Once again they were not given immediate approval because Bernanke etc did not want to mark distressed banks with a big bulls eye on them.


12 posted on 06/28/2012 8:13:10 AM PDT by C19fan
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To: Kartographer
Ann Barnhardt called this a long time ago. She said it would end up being more like $30 billion.

"Ann Barnhardt" is becoming a verb.
Posted by Ann Barnhardt - May 22, AD 2012 2:32 PM MST

"Ann Barnhardt" is becoming a verb, and amazingly, it doesn't mean "to eat bacon cheeseburgers to gluttonous excess."

Woody O'Brien has shut down his brokerage and surrendered his licenses. He "joined the Ann Barnhardt parade."

http://www.youtube.com/v/ERLiHp0d3kQ?version=3

This is a very interesting interview, and O'Brien talks about the JP Morgan prop trade debacle. Jamie Dimon initially said the losses were $2 billion. Now people are talking about it being $7 billion. I think it is $30+ billion. Why? Because as ZeroHedge pointed out, JP Morgan has stopped their stock buy-back program even though their share price has tanked. Interestingly, JPM was told by the Fed that IF they suffered a $31 Billion dollar prop trade loss, they would have to suspend all stock buy-backs.

Uh-huh. Dollars to doughnuts says JPM lost at minimum $30 billion.

That piece is here.

13 posted on 06/28/2012 8:14:44 AM PDT by E. Pluribus Unum (Government is the religion of the sociopath.)
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To: The_Reader_David

Back in the day investment banks were partnerships. So the partners had a direct financial stake to make sure the bank was a watertight as possible and did not sink dragging them along with it. When this changed and investment banks became publicly owned corporations now you can run up the risk get huge compensation packages when the bets paid off and jump like a rat off the ship.


14 posted on 06/28/2012 8:17:22 AM PDT by C19fan
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To: Kartographer

They keep going on about JPMC and their LEGAL loss of company money.

Not a word about the criminal theft of funds from MF Global by John Corzine.

Not a word. I wonder why?

Mark


15 posted on 06/28/2012 8:40:16 AM PDT by MarkL (Do I really look like a guy with a plan?)
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To: liberalh8ter
If they didn’t need it, they could have returned it the next day.

No they couldn't.

Call me cynical but I think when the smoke clears, we’ll find out that there was a wealth distribution to big banks.

LOL! It cost JPM $795,138,889 in dividends.

And the Treasury sold the JPM warrants for $936.1 million.

16 posted on 06/28/2012 8:43:07 AM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
My thoughts are what we've been told about all of this is BS. I have no choice to believe that because A.) there's been no complete accounting of the FED and B.) Bernanke has already been caught in a lie about bailing out foreign interests. At such a time that a complete audit is undertaken and disclosed and it's proved that Ben didn't lie, I'll agree with you.
17 posted on 06/28/2012 8:48:19 AM 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: liberalh8ter
My thoughts are what we've been told about all of this is BS.

Yeah, the banks lied about paying it back and the Treasury lied about getting the money.

I have no choice to believe that because A.) there's been no complete accounting of the FED

TARP was the Treasury, not the Fed.

B.) Bernanke has already been caught in a lie about bailing out foreign interests.

What lie? Where? Link?

At such a time that a complete audit is undertaken

They're audited every year.

18 posted on 06/28/2012 8:58:48 AM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
No they couldn't.

Sure they could. It's called a "check". Just make it out, sign it, and drop it in the mail. Then deduct that amount from their cash on hand ledger.

Whether or not it's cashed isn't up to JPM. But they could have sent out a press release saying they'd sent the Fed a check and that the debt was now officially off their books. They could have done that an hour after they were forced to accept the money.

19 posted on 06/28/2012 9:04:23 AM PDT by Lurker (Violence is rarely the answer. But when it is, it is the only answer.)
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To: C19fan
Just to be fair about JP Morgan...

I think you should demonstrate with a sign that reads " Fairness for JP Morgan". Do the bankers have to come in and take your furniture before you understand what's happening?

20 posted on 06/28/2012 9:06:56 AM PDT by Stentor (Former free citizen of the US. Currently subject of the same.)
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To: Kartographer

Here comes another bailout.


21 posted on 06/28/2012 9:09:35 AM PDT by dfwgator
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To: Toddsterpatriot
What lie?Where? Link?

http://www.unelected.org/audit-of-the-federal-reserve-reveals-16-trillion-in-secret-bailouts

They're audited every year

The audit was 'limited'

http://rgvrlc.org/2011/08/gaos-limited-audit-of-the-federal-reserve-sickening

22 posted on 06/28/2012 9:24:37 AM 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: Lurker
Sure they could. It's called a "check".

No they couldn't. They had to get permission from their regulators first.

23 posted on 06/28/2012 11:38:56 AM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: liberalh8ter
http://www.unelected.org/audit-of-the-federal-reserve-reveals-16-trillion-in-secret-bailouts

Thanks for the link. Now all you have to do is show me what Bernanke said and tell me how your link proves he lied.

They're audited every year

The audit was 'limited'

What do you feel was left out?

24 posted on 06/28/2012 11:42:54 AM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
They had to get permission from their regulators first.

Bullcrap. Show me the documentation of that. Cite the page number and paragraph with a link to a PDF or Word document.

25 posted on 06/28/2012 11:58:52 AM PDT by Lurker (Violence is rarely the answer. But when it is, it is the only answer.)
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To: Lurker
U.S. Said to Plan Approval Today for 10 Banks to Repay TARP

First paragraph.

The Treasury is preparing to announce today it will let 10 banks buy back government shares, people familiar with the matter said, signaling confidence some of the largest U.S. lenders won’t again need a taxpayer rescue.

JPMorgan Chase & Co. is among those cleared to repay Troubled Asset Relief Program funds, a person said on condition of anonymity.

26 posted on 06/28/2012 12:10:22 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
Thanks for the link. Now all you have to do is show me what Bernanke said and tell me how your link proves he lied.

Go to YouTube and look for the video of Alan Grayson querying Bernanke on who received the credit swap money. Bernanke says (paraphrasing) 'he doesn't know because the Fed only gave, short-term, colatarized liquidity swaps to the CFPP.".

Then, there's this:

http://www.zerohedge.com/article/meet-35-foreign-banks-got-bailed-out-fed-and-just-cpff-banks

Suddenly, they know who got the money....

What do you feel was left out?

The senate slashed the audit bill so that no individuals, partnerships or hedge fund bail outs were included in the audit.

27 posted on 06/28/2012 12:41:30 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: Buckeye McFrog

“the most immediate effect of this will be to get a Fake White Indian elected to the US Senate.”

She is like a derivative, she has no intrinsic value.


28 posted on 06/28/2012 1:06:56 PM PDT by A Strict Constructionist (We're an Oligrachy...Resistance to tyrants is obedience to God. Thomas Jefferson)
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To: Toddsterpatriot

That’s not what I asked you for.


29 posted on 06/28/2012 1:08:25 PM PDT by Lurker (Violence is rarely the answer. But when it is, it is the only answer.)
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To: liberalh8ter
Go to YouTube and look for the video of Alan Grayson querying Bernanke on who received the credit swap money.

Grayson is a moron. Credit swap money? You mean swaps between the Fed and other central banks?

If that's the case, the Fed swapped dollars in exchange for their foreign currency. If you think Grayson and his smugly, idiotic questions caught Bernanke in a lie, you'll have to show me the clip.

I'll be happy to explain your error.

What do you feel was left out?

The senate slashed the audit bill so that no individuals, partnerships or hedge fund bail outs were included in the audit.

Huh? You'll have to clarify, because that makes no sense. Do you understand what an audit includes?

30 posted on 06/28/2012 2:13:25 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Lurker

What part of the government bought shares and wasn’t going to sell them back just because you “mailed tham a check” was too confusing for you?


31 posted on 06/28/2012 2:15:13 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
I've provided you with everything you've asked for, I can't make it any clearer than I have. Your question regarding the audit leads me to believe that it's you that doesn't understand what the audit includes. Good day to you.
32 posted on 06/28/2012 2:46:15 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: liberalh8ter
I've provided you with everything you've asked for

No you haven't. You said Bernanke lied. Then you failed to provide his lie. Or show that your magazine article proves he lied.

Your question regarding the audit leads me to believe that it's you that doesn't understand what the audit includes.

Audits include assets, liabilities, cash flow statements, purchases and sales. What else do you think they should include?

Good day to you.

Run away.

Be sure to let me know if you ever find proof for your claims.

33 posted on 06/28/2012 2:56:10 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: Toddsterpatriot
A.) it doesn't matter that crazy Grayson asked the queston, what matters is Bernanke's answer to a question which

B.) is then refuted by the ZH article. BTW, there are other ZH articles re: Bernanke's lies about the European bailout. He's also on record lying on 60 minutes about printing money (attests to Bernanke's credibility) but then, you don't seem to be interested in the proof that's out there as much as you seem interested in defending Bernanke.

C.) audits involve more than the items you listed depending on the type of audit. Like I said, the senate cut the bill and it then precluded auditing particulars in regard to bailouts of entities other than banks.

D.) I'm not running anywhere, I just have no further interest in providing you with information that you obviously haven't even looked at. Aside from that, you seem to enjoy playing internet tough guy and I'm just not interested.

34 posted on 06/28/2012 3:48:33 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: liberalh8ter
Link to the video and tell me the time at which Bernanke lies.

Then we can continue the discussion.

audits involve more than the items you listed depending on the type of audit.

http://www.federalreserve.gov/monetarypolicy/bst_fedfinancials.htm

The above link has the last 2 years of audited Fed financials.

Like I said, the senate cut the bill and it then precluded auditing particulars in regard to bailouts of entities other than banks.

Fed bailouts? How is a loan, a short term loan, a bailout?

I just have no further interest in providing you with information

Yes, I've noticed your inability to provide information proving your claims.

35 posted on 06/28/2012 4:04:12 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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To: liberalh8ter

http://www.youtube.com/watch?v=n0NYBTkE1yQ

LOL!


36 posted on 06/29/2012 4:15:01 PM PDT by Toddsterpatriot (Math is hard. Harder if you're stupid.)
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