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Message
re: JPMorgan Chase...uh oh!
Posted on 5/10/12 at 10:34 pm to LSURussian
Posted on 5/10/12 at 10:34 pm to LSURussian
quote:
I can see JPM falling quite a bit, maybe 25%.
If JPM took a 25% haircut I would seriously look into buying hand over fist, that being said I hadn't really looked into this situation to much...
But I'm very nervous about financials right now. I'm staying with the stronger banks
2
Posted on 5/10/12 at 10:45 pm to greenhead11
I would absolutely buy on margin if that happened.
Posted on 5/11/12 at 7:42 am to greenhead11
quote:It's off to a good start today. JPM is down 8% in pre-market trading this morning.
If JPM took a 25% haircut I would seriously look into buying hand over fist
ETA: Make that 9% now....
This post was edited on 5/11/12 at 8:30 am
Posted on 5/11/12 at 8:18 am to LSURussian
Why is this effecting the prices of the other banks? I understand Euro contagion fears and the systemic risk issues in '08, but is JP Morgan losing $2B actually of any consequence to the other banks? As big as that is, shouldn't JPM be able to cover that relatively easily?
ETA: Oh Gods of the Money Talk Board, I come to you and ask the above questions with humility. Please bless me with your answers with a minimal amount of snarkiness.
ETA: Oh Gods of the Money Talk Board, I come to you and ask the above questions with humility. Please bless me with your answers with a minimal amount of snarkiness.
This post was edited on 5/11/12 at 8:21 am
Posted on 5/11/12 at 8:25 am to mule74
quote:
Why is this effecting the prices of the other banks? I understand Euro contagion fears and the systemic risk issues in '08, but is JP Morgan losing $2B actually of any consequence to the other banks? As big as that is, shouldn't JPM be able to cover that relatively easily?
1) Because markets are stupid.
2) Yes, but it made Dimon seem like a dumbass, and his repuation is one of the most valuable assets of JPM.
Posted on 5/11/12 at 8:27 am to mule74
quote:It is less than half of one quarter's net profit. With the tax write offs available, it is probably less than one-third of a quarter's profit. The fear is the $2 billion is just a start. JPM still has the positions and therefore may have additional losses from it.
As big as that is, shouldn't JPM be able to cover that relatively easily?
quote:The unknown of if they have similar investment positions is all I can think of.
Why is this effecting the prices of the other banks?
Posted on 5/11/12 at 8:35 am to mule74
quote:
but is JP Morgan losing $2B actually of any consequence to the other banks?
Not significantly. BUT with Euro zone debacle the other US banks will get indiscriminately brought down with JPM. People are going trade and some case panic sell ETF and funds that hold JPM.
Posted on 5/11/12 at 8:36 am to greenhead11
quote:
Not significantly. BUT with Euro zone debacle the other US banks will get indiscriminately brought down with JPM. People are going trade and some case panic sell ETF and funds that hold JPM.
Translate: Mr. Market got up on the wrong side of the bed this morning.
Posted on 5/11/12 at 8:40 am to CamdenTiger
quote:
the London whale," was making such large trades that he was moving prices in the $10 trillion market.
I couldn't even begin to fathom having the green light to make these kind of trades. Be cool as hell until...well your 2b loss makes headline news.
Posted on 5/11/12 at 9:21 am to LSUAfro
Breaking News from NYT:
"The US and UK regulators have been in discussion with JPM for a month about these trades".
The question now is the adjustment on their risk model and how are they going to get out of these trades? I wonder who made the money on the other side? Probably a hedge fund.
I would be looking to buy around $28-29. Real risk is the outcry from the .gov on limiting these trades. Regulations would hurt profits of banks and would have to take another look at valuation.
"The US and UK regulators have been in discussion with JPM for a month about these trades".
The question now is the adjustment on their risk model and how are they going to get out of these trades? I wonder who made the money on the other side? Probably a hedge fund.
I would be looking to buy around $28-29. Real risk is the outcry from the .gov on limiting these trades. Regulations would hurt profits of banks and would have to take another look at valuation.
Posted on 5/11/12 at 9:37 am to LSURussian
quote:
The unknown of if they have similar investment positions is all I can think of.
But they really don't. They've been making a big deal out of this one trader in London cornering the entire CDS market with giant trades for like the last 2 months. Its a unique situation within JPM and to JPM in and of itself.
Posted on 5/11/12 at 9:44 am to kfizzle85
The part about the story which I can't figure out is they (CNBC) keep saying the losing position was a hedge. If so, wouldn't that normally mean the position they were hedging against would have offsetting gains? Obviously it was not a "fit and proper" hedge.
Somehow what was meant to be a hedge really was not a hedge.
Somehow what was meant to be a hedge really was not a hedge.
This post was edited on 5/11/12 at 10:03 am
Posted on 5/11/12 at 9:54 am to LSURussian
Are you presuming Russian that more then .5% of the population have any idea what a true hedge is? lol
Posted on 5/11/12 at 10:00 am to igoringa
Good point! 
Posted on 5/11/12 at 10:46 am to igoringa
quote:
Are you presuming Russian that more then .5% of the population have any idea what a true hedge is?
Posted on 5/11/12 at 12:17 pm to donRANDOMnumbers
The SEC should be looking at how financial institutions and hedge funds are using the media. Look at the chronology going back to the end of the first quarter:
Tuesday, March 13,2012. Jamie D (after the close) makes a surprise announcement of dividends and stock buybacks. This forces Ben Bernanke to release the results of the stress test by 2 days. I believe the results were schedule to be released at 4:30 on Thursday, the 15th.
April 3, 2012. JPM trots out Blythe Masters in an in depth interview with Melissa Lee on CNBC. Although her division is not related to these announced losses, Masters was there to explain to viewers that JPM was not speculating in commodities. Granted, there had been a lot of buzz on the interwebs about JPM and their silver position, but what else is new? The metals bugs are always heavy on this topic.
The Bruno Iksel story has been out there for a month. I listened to an interview this morning from the NYT writer who wrote the story. It was blatantly obvious from his interview that the Hedge Funds who were on the opposite side of the JPM trade were talking to journalists. JPM certainly isn’t going to disclose exactly what their position entails.
Indeed, in a Bloomberg article today, Jonathan Weil, admits that the hedge funds were leaking because the position became so large it was crowding out positions. No shite! It was obvious also that hedge funds leaking to zerohedge last month. I know that many here are critical of zerohedge, but whether right or wrong, financial market players are leaking information to these journalists and bloggers.
It is an election year and this story ain’t over.
Tuesday, March 13,2012. Jamie D (after the close) makes a surprise announcement of dividends and stock buybacks. This forces Ben Bernanke to release the results of the stress test by 2 days. I believe the results were schedule to be released at 4:30 on Thursday, the 15th.
April 3, 2012. JPM trots out Blythe Masters in an in depth interview with Melissa Lee on CNBC. Although her division is not related to these announced losses, Masters was there to explain to viewers that JPM was not speculating in commodities. Granted, there had been a lot of buzz on the interwebs about JPM and their silver position, but what else is new? The metals bugs are always heavy on this topic.
The Bruno Iksel story has been out there for a month. I listened to an interview this morning from the NYT writer who wrote the story. It was blatantly obvious from his interview that the Hedge Funds who were on the opposite side of the JPM trade were talking to journalists. JPM certainly isn’t going to disclose exactly what their position entails.
Indeed, in a Bloomberg article today, Jonathan Weil, admits that the hedge funds were leaking because the position became so large it was crowding out positions. No shite! It was obvious also that hedge funds leaking to zerohedge last month. I know that many here are critical of zerohedge, but whether right or wrong, financial market players are leaking information to these journalists and bloggers.
It is an election year and this story ain’t over.
Posted on 5/11/12 at 12:25 pm to Blakely Bimbo
quote:True. We will learn which politicians JPM's PAC didn't contribute to......
It is an election year and this story ain’t over.
Posted on 5/11/12 at 1:34 pm to Blakely Bimbo
quote:
Indeed, in a Bloomberg article today, Jonathan Weil, admits that the hedge funds were leaking because the position became so large it was crowding out positions. No shite! It was obvious also that hedge funds leaking to zerohedge last month. I know that many here are critical of zerohedge, but whether right or wrong, financial market players are leaking information to these journalists and bloggers.
I'm not sure what you're getting at here (or ever really, but you never answer rebuttles so), but every story I read about this subject prior, the entire point of the story was other traders (hedge funds or otherwise) complaining about the whale crowding out positions. I'm not sure how that's "leaking information," it was the basis of the story from the get go.
Posted on 5/11/12 at 3:43 pm to kfizzle85
Fitch just downgraded JPM.
The story originated with the Hedge funds. They wanted the story public for their benefit. It's all being played out in the media.
J Weil
The story originated with the Hedge funds. They wanted the story public for their benefit. It's all being played out in the media.
quote:
The reason the world learned last month of JPMorgan’s “London Whale” bets on the credit markets to begin with is they had become so big -- with as much as $100 billion riding on one side of a single transaction -- that the bank’s trades were moving, and maybe even distorting, the market. Some of the bank’s counterparts were so upset about this that they started complaining to journalists. Getting Squeezed They seem to have discerned the broad outlines of the trading positions a while ago. Now they are squeezing the bank for maximum gain, while JPMorgan is trying to unwind the trades without losing its skin. JPMorgan can delay coming clean with the basic facts, though they probably will come out eventually. Some congressional committee is bound to subpoena its trading records.
J Weil
Posted on 5/11/12 at 4:01 pm to Blakely Bimbo
I still don't understand what you're trying to get at, as if there's something nefarious going on, but you do tend to pop up whenever something might be even marginally negative economically, so IDK why I'm debating myself here.
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