Who got the 2 billion that JP Morgan lost?

[percysunshine]

It had to go somewhere....

The other side of the trade.

It is an interesting topic. Some group like Chase, or Barclays loses a couple billion dollars, but the money did not evaporate, it just changed hands. Someone is always on the other side of the trade, or there would never be a trade in the first place.


All that housing money that supposedly evaporated in the 2008 realestate bubble? It just traded hands. People who bought a house in California for $50,000, and then sold it 7 years later for $500,000 were the other hands.

Not entirely accurate. When a bank writes down a mortgage in default, that money extinguishes from existence. It was just debt money assumed to exist that the bank created in the first place by offering the loan.

An unpaid loan is an unpaid loan. Someone got the money up front.

 

[Paulie]

The other side of the trade.

It is an interesting topic. Some group like Chase, or Barclays loses a couple billion dollars, but the money did not evaporate, it just changed hands. Someone is always on the other side of the trade, or there would never be a trade in the first place.


All that housing money that supposedly evaporated in the 2008 realestate bubble? It just traded hands. People who bought a house in California for $50,000, and then sold it 7 years later for $500,000 were the other hands.

Not entirely accurate. When a bank writes down a mortgage in default, that money extinguishes from existence. It was just debt money assumed to exist that the bank created in the first place by offering the loan.

An unpaid loan is an unpaid loan. Someone got the money up front.

The bank creates the money out of thin air and it becomes an asset on their balance sheet. If that loan is written off in the event of a default, the bank's balance sheet contracts, and the money supply decreases.

You're looking at in too simplistic a way.

 

[Flopper]

Can't keep a lid on it because they can't help but create a new speculation. Kick the can. YEEEHAW

Here is a description of the trading that lost all the money. "It’s incredibly complicated, but basically he was selling a form of insurance to other investors based on his belief that certain U.S. corporate bonds would be very secure. He sold so much of it that any blip in the market could have caused him enormous pain. The market blipped. JPMorgan suffered losses of at least $2 billion, and potentially much more."

How the JPMorgan trade happened and what it means - The Washington Post

My neighbor who has an account at Chase asked the question, "What's my bank doing gambling on moves in interest rates, currencies, and commodities"? The US Congress needs to answer that question.

Damin has admitted that JP Morgan Chase, the largest casino in world, didn't know how much risk they were taking. That's pretty scary when you consider Chase holds over trillion dollars in deposits, 15% of the nation's GNP.

Jamie Dimon was once the silver-haired hero of Wall Street, scooping up failing banks during the worst of the financial crisis and avoiding the kind of toxic mortgage bonds that sent competitors into bankruptcy and pushed the American economy to the brink.
He was also one of President Barack Obama’s most prominent Wall Street friends, a rare high-profile Democrat in an industry dominated by low-tax, free-market Republicans. Dimon spent several years in Obama’s hometown of Chicago, where he ran Bank One after a nasty breakup with his one-time mentor. He got to know Rahm Emanuel. He hired Bill Daley as a top executive before Daley became Obama’s second chief of staff. He gave hundreds of thousands of dollars in contributions to Democrats.

Obama returned all the love, at least at first. Dimon made at least 16 trips to the White House and met at least three times with Obama — a bond that allowed the president to appear business-friendly. The New York Times in 2009 called Dimon Obama’s “favorite banker.”

Read more: The Jamie Dimon - President Obama saga - POLITICO.com

Love the way the left rewrite facts that don't suit them.

Jamie Dimon is not the problem. He's probably the most competent all the big bank CEOs. 25 years of bank deregulation has created businesses that are not just too big to fail, but are too big to manage. The only way the big banks can generate the profits demanded by investors is to balance off the relatively low return of conventional banking with highly speculative investments. If they can manage their risk, which they have not done very effectively, they become very profitable but it they blow it, they can bring down the whole economy.

 

[g5000]

All that housing money that supposedly evaporated in the 2008 realestate bubble? It just traded hands.

Completely false.

 

[dilloduck]

Chase has been leading the charge in trying to reduce risk for over 10 years and apparently not very successfully. Of course, if they did what they should be doing, managing customer deposits and making loans instead speculating in currency and derivatives markets, there wouldn't be any need for the elaborate risk management.

Can't keep a lid on it because they can't help but create a new speculation. Kick the can. YEEEHAW

Here is a description of the trading that lost all the money. "It’s incredibly complicated, but basically he was selling a form of insurance to other investors based on his belief that certain U.S. corporate bonds would be very secure. He sold so much of it that any blip in the market could have caused him enormous pain. The market blipped. JPMorgan suffered losses of at least $2 billion, and potentially much more."

How the JPMorgan trade happened and what it means - The Washington Post

My neighbor who has an account at Chase asked the question, "What's my bank doing gambling on moves in interest rates, currencies, and commodities"? The US Congress needs to answer that question.

Damin has admitted that JP Morgan Chase, the largest casino in world, didn't know how much risk they were taking. That's pretty scary when you consider Chase holds over trillion dollars in deposits, 15% of the nation's GNP.

Our economy is a shell game. Do you realize how much money people make just manipulating money or just plain gambling. They don't do a damn thing that a normal person would interpret as "work".