Wall Street heavyweight JP Morgan suffers $2 billion trading loss.

ironic the guys who drove the risky play was named Achilles..

Brig back Glass Spleagall(sp)!

Rockslinger said:

Brig back Glass Spleagall(sp)!

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Won't happen. Far too many people make too much money now.

But we might get the Volcker Rule now.

Is proprietary trading a "zero sum" game? If J.P. Morgan loses $2billion on a trade, does it stand to reason that somebody else made $2billion?

Rockslinger said:

Is proprietary trading a "zero sum" game? If J.P. Morgan loses $2billion on a trade, does it stand to reason that somebody else made $2billion?

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For that particular trade, building a huge position on the CDX IG9 (a credit derivative index that's not the latest but still probably the biggest) the answer is yes, definitely. Credit derivatives in general are zero-sum games. They don't really generate economic activity, in the way that, say issuing bonds do, or even buying swaps.

Iksil was making such huge trades that people knew what he was up to (flattening the tail end of the curve) and everyone and their dog bet against him!

This is the tip of the iceberg for JPM.

http://www.silverdoctors.com/jpm-axes-its-achilles-2-more-execs-over-derivatives-losses/

Is it 2B or 100 Billion ?

BS

freekingfun said:

Iksil was making such huge trades that people knew what he was up to (flattening the tail end of the curve) and everyone and their dog bet against him!

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So, these other people made a profit of $2billion? Sort of like hockey, the Leafs lose but another team won. Life is full of winners and losers.

I spoke to my broker. He said that J.P Morgan lost $2billion bit somebody else who is smarter, wiser, bolder and/or luckier made a profit of $2billion on the same trades. For every loser there is a winner. For every winner there is a loser.

rafterman said:

http://www.washingtonpost.com/busin...lure/2012/05/11/gIQAjxqnHU_story.html?hpid=z1

Ha ha ha "an egregious failure". CEO Jamie Dimon has been one of the most vocal critics of those calling for greater regulation and oversight of the Wall Street investment banks.

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I heard he still get his $23 million salary. geez for that kind of salary I could screw up all day long!