djAdvocate
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Post by djAdvocate on May 21, 2012 20:39:52 GMT -5
how high will it have to go before the apologists stop trivializing it? $10B? $20B? money.cnn.com/2012/05/18/markets/jpmorgan-loss/index.htm?iid=LeadNow as the overall market has worsened, it costs even more for JPMorgan Chase to sell protection against possible bankruptcies on corporate bonds
Since JPMorgan Chase is basically the only one on its side of the bet, a worsening market makes it even more expensive to keep this position and more difficult to find other places to offset these losses.. my bet: the American Public will be asked to socialize these costs. but we won't call that socialism.
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formerexpat
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Post by formerexpat on May 21, 2012 20:42:10 GMT -5
Let them fall.
Doubt that will happen; JPM is a DC favorite with that sweetheart deal they got for Bear Stearns.
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djAdvocate
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Post by djAdvocate on May 21, 2012 20:52:24 GMT -5
Let them fall. Doubt that will happen; JPM is a DC favorite with that sweetheart deal they got for Bear Stearns. nfk. this bank is a complete POS. i would like to see it run down the shredder. it won't happen. we will loan it more money, instead.
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Deleted
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Post by Deleted on May 21, 2012 21:19:33 GMT -5
Nobody is going to bail out a bank if it goes bankrupt. But hopefully any other banks without sufficient controls over their derivatives trading will take note and learn from these mistakes.
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handyman2
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Post by handyman2 on May 21, 2012 21:20:32 GMT -5
My guess is that JPM will be absorbed by some other large financial institution and its losses will be written off to the detriment of other financial entities.
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djAdvocate
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Post by djAdvocate on May 21, 2012 22:01:20 GMT -5
Nobody is going to bail out a bank if it goes bankrupt. But hopefully any other banks without sufficient controls over their derivatives trading will take note and learn from these mistakes. i wasn't talking about bankruptcy. the gov will never allow that. they will, however, throw billions at it to prevent that. THAT is what i was talking about.
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mwcpa
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Post by mwcpa on May 22, 2012 5:48:25 GMT -5
..... in this mess, will the CEO will still be rewarded ..... i guess we can expect "fees" at Chase to rise soon enough ..... it seems the bank did not learn their lesson, oh wait, will we have learned our lesson is probably more appropriate, will we allow Congress to bail them out again? Clearly Dodd Frank does not go far enough (in my opinion) to keep the too big to fail arrogance in check....if Chase, a supposed conservative institution did this, what do we think the riskier banks did or do?
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Deleted
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Post by Deleted on May 22, 2012 6:23:07 GMT -5
Why would the gov't throw billions at the bank? They have no reason to. The $6-7B is already gone. Giving them money wouldn't serve any purpose.
"Clearly Dodd Frank does not go far enough (in my opinion) to keep the too big to fail arrogance in check....if Chase, a supposed conservative institution did this, what do we think the riskier banks did or do?"
Personally, I'd like decisions to be made based on facts, not on someone's assumptions. And I don't understand why everyone seems to think the gov't is going to try to step in and bail out JPM. Banks fail all the time. The gov't doesn't bail them out.
The only time the gov't stepped in and stopped banks from failing was when they were all about to fail at the same time which would have destroyed the global economy. Anybody here who would have preferred total destruction instead of a recession, raise your hand.... Anybody?
And even when they did that, they let one big bank fail on purpose. There are not banks that are "too big to fail". They are just "too big to fail all at the same time".
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morrisr2d2
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Post by morrisr2d2 on May 22, 2012 6:23:40 GMT -5
According to Jamie, this is a "nick" on their balance sheet. Is this more of a hit to earnings for a few quarters or do you really think they will need to be saved, and at what point? $50B? $100B?
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Post by Deleted on May 22, 2012 6:40:08 GMT -5
"According to Jamie, this is a "nick" on their balance sheet."
They've had their credit downgraded over this. If it's just a "nick", it has developed a nasty infection.
"It also seems that once JPM starts to sell the value of these positions will tank. I've also read that they own so much of them that they can't quickly trade out of them. "
Yes, that's why a small loss can balloon into a huge loss so quickly. Most likely, the trader lost a little, tried to fix it before anyone noticed, and then things really got out of control. It's a major black-eye for the bank. Not only is it money lost, but their credit was downgraded, and I'm sure they'll lose customers over it.
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mwcpa
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Post by mwcpa on May 22, 2012 6:58:33 GMT -5
"Personally, I'd like decisions to be made based on facts, not on someone's assumptions."
That's why I asked the question.... I still personally feel that Glass Steagall (or something like it) should be reinstated.... banking should be boring in my opinion..... banking should not involve big gambles..... and it now appears that this "hedge" was a big gamble....
Wile I do not disagree with the "saving the system" rally about the big bank bailout, the big banks did little, in my opinion after the bailouts to help regular folks (which was the advertised intent by Mr Bush, Mr Paulson, Mr Geithner and others)... they took our tax money, they firmed up their balance sheets, they paid bigger bonuses to the few while they laid off the masses, got bigger and fatter and control more.... and now they are getting in trouble again (after the robo signing issues), possibly big trouble.... we still need more facts, but I am not optimistic given history and the greed over huge benefits for short term (and in many cases short sighted) results .....
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workpublic
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Post by workpublic on May 22, 2012 8:31:15 GMT -5
mwcpa,
agree!
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:35:01 GMT -5
Why would the gov't throw billions at the bank? They have no reason to. The $6-7B is already gone. Giving them money wouldn't serve any purpose. rewind to 2007. press play. you're welcome.
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:36:29 GMT -5
According to Jamie, this is a "nick" on their balance sheet. Is this more of a hit to earnings for a few quarters or do you really think they will need to be saved, and at what point? $50B? $100B? right now it would take 2-3 quarters to make this up in absolute terms. in cash flow terms, it is probably more like a year. it is going higher.
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Post by Savoir Faire-Demogague in NJ on May 22, 2012 10:37:26 GMT -5
Why would the gov't throw billions at the bank? They have no reason to. The $6-7B is already gone. Giving them money wouldn't serve any purpose. rewind to 2007. press play. you're welcome. Nearly all the tarp loans were paid back. The Treasury reaped a windfall on those transactions. Heck $500 million was blown on Solyndra.
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:37:51 GMT -5
ditto. i will add something further: perhaps the threat of NATIONALIZING THEIR ASSES (not a typo) might get their attention.
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:40:57 GMT -5
rewind to 2007. press play. you're welcome. Nearly all the tarp loans were paid back. The Treasury reaped a windfall on those transactions. socialism at it's finest.Heck $500 million was blown on Solyndra. million begins with an "m".
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Driftr
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Post by Driftr on May 22, 2012 10:47:52 GMT -5
Couldn't be happening to a nicer bunch of guys.
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:50:40 GMT -5
Couldn't be happening to a nicer bunch of guys. my sentiments precisely. i hope that they are offered no relief and a lot of abuse for it. that is my ONLY concern.
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vandalshandle
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Post by vandalshandle on May 22, 2012 10:51:43 GMT -5
Chase Bank, is right up there with wireless cell phone companies, time sharing sales operations, and telemarketing operations on my integrity scale. I suspect that everyone who is above supervisor status should be taken outside and shot, and the rest of the employees should be unshackled and allowed to escape.
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djAdvocate
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Post by djAdvocate on May 22, 2012 10:57:14 GMT -5
Chase Bank, is right up there with wireless cell phone companies, time sharing sales operations, and telemarketing operations on my integrity scale. I suspect that everyone who is above supervisor status should be taken outside and shot, and the rest of the employees should be unshackled and allowed to escape. i think that each non-management employee should be sent a rock, with instructions on how to use them.
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Post by Savoir Faire-Demogague in NJ on May 22, 2012 11:14:46 GMT -5
Nearly all the tarp loans were paid back. The Treasury reaped a windfall on those transactions. socialism at it's finest.Heck $500 million was blown on Solyndra. million begins with an "m". It was $500 million of public tax payer money. While the JP Morgan loss is a serious matter, it is private money. There is no law against losing money in the financial markets.
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Post by Savoir Faire-Demogague in NJ on May 22, 2012 11:15:23 GMT -5
Chase Bank, is right up there with wireless cell phone companies, time sharing sales operations, and telemarketing operations on my integrity scale. I suspect that everyone who is above supervisor status should be taken outside and shot, and the rest of the employees should be unshackled and allowed to escape. Add public employee unions to that list.
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djAdvocate
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Post by djAdvocate on May 22, 2012 11:19:55 GMT -5
million begins with an "m". It was $500 million of public tax payer money. correct. and there are still billions out on the bailout. that is also taxpayer money. or does it not count because some of it made a profit.While the JP Morgan loss is a serious matter, it is private money. There is no law against losing money in the financial markets. no it isn't. it is public money. Shittybank is a public corporation. but you are right, there is no law against ripping the public off, when you call it "investment". the pen truly is mightier than the sword.
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frep
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Post by frep on May 22, 2012 11:33:25 GMT -5
Investors must not be too concerned with the increased loss estimate. JPM is up 5% today.
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workpublic
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Post by workpublic on May 22, 2012 11:38:57 GMT -5
good.
i'm also glad they didn't lower the dividend(quarterly).
i own a few shares.
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djAdvocate
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Post by djAdvocate on May 22, 2012 11:41:26 GMT -5
Investors must not be too concerned with the increased loss estimate. JPM is up 5% today. it is still down 17% since the scandal broke. it will probably go lower, until the scope is known.
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frep
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Post by frep on May 22, 2012 11:46:44 GMT -5
I know it's still down. Just saying the new loss estimate doesn't look like it's bothering investors. Maybe they already assumed it was higher. If it initially dropped 10% when they disclosed a $2B loss, you would expect an increase in that amount to make it drop farther.
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Driftr
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Post by Driftr on May 22, 2012 12:03:17 GMT -5
I know it's still down. Just saying the new loss estimate doesn't look like it's bothering investors. Maybe they already assumed it was higher. Investors understand there's usually not just the one cockroach.
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workpublic
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Post by workpublic on May 22, 2012 12:20:07 GMT -5
eventually It'll get back up to $46. I've seen it in the $20s
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