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

#103
#103
Vols520 said:
I get that, investors should be pissed.
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I am sure some are and the meeting today will be even louder/angrier than it was already expected to be. There are bigger issues that will be discussed and voted on at the meeting than this play. Bottom line, it was a roll of the dice that came up snake eyes.
 
#104
#104
TT, how is it that you knew what was going on but that the leadership of the bank didn't know that they had billions of dollars on the line?
 
#105
#105
lawgator1 said:
TT, how is it that you knew what was going on but that the leadership of the bank didn't know that they had billions of dollars on the line?
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I believe he (and Volskin) has answered this twice, now.

More importantly, why is it that you care?
 
#106
#106
therealUT said:
I believe he (and Volskin) has answered this twice, now.

More importantly, why is it that you care?
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Just a pretty bold claim that was made in the context of saying, oh well, they invested and lost, nothing for the government to do here.

I questioned whether the investors, or those depositors possibly put at risk by such plays, really did know what was going on. My argument was that, if they didn't, that is the kind of thing that needs to be the subject of regulation.

Their response was a dismissive and glib "we knew." I don't believe them. It makes no sense to me that they would know and everyone else at the actual institution was effectively oblivious.

And so that's why I care.
 
#108
#108
lawgator1 said:
TT, how is it that you knew what was going on but that the leadership of the bank didn't know that they had billions of dollars on the line?
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Are you that small of a person.......I said I knew exactly what they were doing....ie: going heavy on a hedge bet.....one gets those types of "heads up" when you have a mid six figure account with a company.
 
#109
#109
lawgator1 said:
Just a pretty bold claim that was made in the context of saying, oh well, they invested and lost, nothing for the government to do here.

I questioned whether the investors, or those depositors possibly put at risk by such plays, really did know what was going on. My argument was that, if they didn't, that is the kind of thing that needs to be the subject of regulation.

Their response was a dismissive and glib "we knew." I don't believe them. It makes no sense to me that they would know and everyone else at the actual institution was effectively oblivious.

And so that's why I care.
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The investors absolutely know that their money is going to be used in risky moves. Investors accept that and hope for the big payouts. As for whether "depositers" were put at risk you are making a monstrous speculation with absolutely no warrant to do so, solely so that you can somehow justify having a dog in this fight. You don't and neither does the government.
 
#110
#110
What I can't understand is that LG wants more goverment over sight, when that is what started the whole mess in the first place.

The goverment lowered the standards of getting capital. This created a false market, and opened up demand that wasn't real or sustainable. This wasn't a secert. Everyone in the game knew they were passing around a pig in a poke, but everyone was making money like crazy and was riding the wave that the goverment started.
 
#111
#111
This is a great example of govt being govt. Obama said yesterday 1) there will be an investigation, 2) if JPM wasn't healthy we might have to bail them out, 3) this is why the financial reform they did is so important. Lot's of contradiction in those statements.
 
#112
#112
the bailouts provide incentives for riskier moves yet they are surprised when it leads to things like this
 
#115
#115
Watched the web cast.......the main line of questioning, as it should have been, was the mortgage market. There is very little concern among the share holders of this blip of a lose. Sorry to all those that want to make this more than a risky gamble that went bust.
 
#116
#116
rjd970 said:
That is really the bottomline of this thread.
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That's what bugged me most about Obama's comments. His knee jerk reaction was this could have led to the need for another bailout so we must prevent risk taking. Clearly their are other ways to solve the problem.
 
#117
#117
volinbham said:
That's what bugged me most about Obama's comments. His knee jerk reaction was this could have led to the need for another bailout so we must prevent risk taking. Clearly their are other ways to solve the problem.
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Don't forget his #1 minion.
 
#118
#118
Dodd-Frank law: Too big to succeed - Chicago Sun-Times

It was done in the name of ending too big to fail. But since 2008, big banks have gotten bigger. Richard W. Fisher, president of the Federal Reserve Bank of Dallas, has upset the titans of big finance and the potentates of big government by stating the obvious — these institutions are so huge that Washington would have little choice but to come to their rescue in another crisis.
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Quite the coup - encourage banks to become so big that they threaten the economy then use that as an excuse to regulate the absolute crap out of them.
 
#119
#119
volinbham said:
That's what bugged me most about Obama's comments. His knee jerk reaction was this could have led to the need for another bailout so we must prevent risk taking. Clearly their are other ways to solve the problem.
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If it is even a problem. Obama just needs to stop sticking his nose where it does not belong (JPM, Trayvon Martin, Libya, Syria, Iran, Cambridge Police, Auto-Industry).
 
#120
#120
therealUT said:
If it is even a problem. Obama just needs to stop sticking his nose where it does not belong (JPM, Trayvon Martin, Libya, Syria, Iran, Cambridge Police, Auto-Industry).
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I do think there is a too big to fail problem - that has basically been enshrined further by Dodd-Frank
 
#121
#121
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?
 
#122
#122
T-TownVol said:
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.
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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.
 
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#123
#123
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.
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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.
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#124
#124
TennTradition said:
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.
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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.
 
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