JP Morgan debacle: Regulation of the banks and Dodd-Frank

[VolsNSkinsFan]

I wonder if LG realizes yet that "this trade" was...

A) a bullish bet on the largest US companies that blew up because the economy sucks and
B) placed and approved by JPM execs who are big time supporters of the Obama admin?

[TennTradition]

Originally Posted by T-TownVol

Not you too......I knew of the play that they were making before it was made. I am not into the micro management of my account, that is what they are for. CEO is making prepared statements written by a PR firm. People that have no skin in this issue sure seem to care about it a lot more than those of us that do. Nice attempt to try to "pile on" though.

It was a Hedge Fund bet. High risk, high reward or lose.

So, the CEO is lying about what he was aware of?

And..I'm being serious here. There seems to be a disconnect between saying that it was known to investors who pay attention that this office was making these investments at these levels and the CEO's comments that it had gone much further without oversight than they realized and that it was essentially stupid and careless. Is he just lying about that?

It's interesting because you didn't just say you knew what was going on (this office was hedging), but you knew exactly what was going on (which office, how much, which hedges, etc.). That seems to contradict with the CEO's statements.

[VolsNSkinsFan]

T-Town you might have profited from the trade.

As One JPMorgan Trader Sold Risky Contracts, Another One Bought Them - NYTimes.com

Even as a trader for JPMorgan in London was selling piles of insurance on corporate debt, figuring that the economy was on the upswing, a mutual fund elsewhere at the bank was taking the other side of the bet.

But perhaps one of the most surprising takers of the JPMorgan trade was a mutual fund run out of a completely different part of the bank. The bank’s Strategic Income Opportunities Fund, which holds about $13 billion in client money, owns about $380 million worth of insurance identical to the kind the “London whale” was selling, according to regulatory filings and people with knowledge of the trade. It is unclear how much the fund made.

[T-TownVol]

Originally Posted by TennTradition

So, the CEO is lying about what he was aware of?

And..I'm being serious here. There seems to be a disconnect between saying that it was known to investors who pay attention that this office was making these investments at these levels and the CEO's comments that it had gone much further without oversight than they realized and that it was essentially stupid and careless. Is he just lying about that?

It's interesting because you didn't just say you knew what was going on (this office was hedging), but you knew exactly what was going on (which office, how much, which hedges, etc.). That seems to contradict with the CEO's statements.

Very "LG" of you to define what I meant by using the word "exactly".
Your questions have been asked and answered by me and others. But I will repeat, I do not micro manage my accounts, that is what my brokers are for. He would have provided exact funds, amounts and locations IF I had asked. I did not, as I suppose the CEO did not ask so that he can make the claims he is now making.

[T-TownVol]

Originally Posted by VolsNSkinsFan

T-Town you might have profited from the trade.

As One JPMorgan Trader Sold Risky Contracts, Another One Bought Them - NYTimes.com

.....amazing how that works isn't it......and people wonder why the shareholders are not "up in arms" over the bad hedge bets

[lawgator1]

Knowing that, generally speaking, they are investing in hedge funds, is not the same thing as knowing the amount, the type, or the risk, involved.

As I understand the comments of bank management and of Ttown (and Ttwon correct me if I am wrong) they were both in the former category. That is, the bank management, and Ttown as an investor, were generally aware that the portfolio included hedge funds, no necessarily what kind, amounts, etc.

Now, bank management says that sucks, they ought to have kept a better eye on it, they will reform, a few people are retiring, etc.

Ttown, you are okay with that because, in your view, knowing the general state of affairs is okay since you are investing with them precisely so that they manage the money. If the totally screw up and lose it all, then they go away. And the investor accepts that risk.

And, since the bank on the whole shows profit in investing, you simply view this as a loss to be balanced against better gains.

Have I about got it right?

[TennTradition]

Originally Posted by T-TownVol

Very "LG" of you to define what I meant by using the word "exactly".
Your questions have been asked and answered by me and others. But I will repeat, I do not micro manage my accounts, that is what my brokers are for. He would have provided exact funds, amounts and locations IF I had asked. I did not, as I suppose the CEO did not ask so that he can make the claims he is now making.

OK, so he is telling the truth but could have known had he not wanted plausible deniability.

Also, you could have known exactly what "bets" this office was making, but you didn't. Correct?

I didn't intend to stretch the meaning of the word exactly - I was simply trying to point out that exactly is a strong word. And, it seems that it didn't apply in this case...just that you could have known exactly had you wanted to micromanage your account (in other words, they weren't hiding this).

[BigPapaVol]

If he's trading on bank capital that is tied to FDIC deposits, it should be canned. If he's trading third party capital that is uninsured accounts, then the gov't should shut its piehole.

[T-TownVol]

Originally Posted by TennTradition

OK, so he is telling the truth but could have known had he not wanted plausible deniability.

Also, you could have known exactly what "bets" this office was making, but you didn't. Correct?

I didn't intend to stretch the meaning of the word exactly - I was simply trying to point out that exactly is a strong word. And, it seems that it didn't apply in this case...just that you could have known exactly had you wanted to micromanage your account (in other words, they weren't hiding this).

[T-TownVol]

Originally Posted by BigPapaVol

If he's trading on bank capital that is tied to FDIC deposits, it should be canned. If he's trading third party capital that is uninsured accounts, then the gov't should shut its piehole.

if only

[volinbham]

I know I'm stating the obvious but the only reason the govt is getting involved is for political theater

[Redstater]

So JP Morgan loses $2 to $4 billion of shareholder money over the course of six weeks and ~$15 billion in market capitalization. Every politician in DC, every news outlet and commentator goes ape____ calling for more regulation and for firings.

Every day if not every hour several billon of our money is wasted through incompetenance, theft and every other conceivevable way. Where's collective outrage?

I currently don't own JPM stock and as long as depositers' money wasn't gambled and they're not putting the banking system in danger I don't give a rip. What does irritate the hell out of me are sanctimonious politicians who wouldn't know a put from a call but are recklessly spending trillions.