Thursday, June 28, 2012

Rounding Error

Odds of it being "only" $2 billion were pretty low.
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.

Still he's the bestest and the brightest and the smartest of all the bankers and his bank is the bestest and the bestest run and the promise of perpetual bailout and the presence of the free money bazooka from the government has nothing to do with any of that so stop saying that shut up Shut up Shut Up SHUT UP SHUT UP SHUT UP SHUT UP.

And why is this even worth remarking on?
“Essentially, JPMorgan has been operating a hedge fund with federal insured deposits within a bank,” said Mark Williams, a professor of finance at Boston University, who also served as a Federal Reserve bank examiner.

That was the whole point of repealing Glass-Steagall, though it was pitched for other reasons. Take your money to the great casino, heads they win, tails they win and we lose.