Let's take a good look at tomorrow douchebag of the week, Jamie Dimon, head of JP Morgan/Chase. It was discovered this week that the bank had lost at least $2 billion and many feel that is just the tip of the iceberg. Bank stocks fell off the map but the rest of the market remained steady, the only reason being the Plunge Protection Team, which is still only rumored to exist, bought huge quantities of stock to keep the DOW afloat. This is almost certainly in connection with the alleged trillionaires of the planet using their vast sums of money to inflate a stock market that is now nothing more than a rigged casino. In other days, the market would have dropped at least 500 points on the news that JP Morgan lost such a vast sum of money, but no, the market dropped only 30 points instead. Still believe the market isn't rigged?
But let's look at the bigger picture, one mentioned many times over the past few years, that the out of control derivative market is a sword of Damocles and about to fall. The financial world has long considered Jamie Dimon one of the best CEO's in the country and has long been one of the most vocal people against re-instating the Glass-Steagal Act or even the watered down Volker Rule that would have ever prevented these kind of losses. Yet, here we are four years after the financial ruin banks brought us to and we see nothing has changed. The derivative market is a black hole waiting to suck us all in and no one seems to notice.
Banks have become casinos with huge payouts or busts depending on the market. This week JP Morgan hit bust and no one knows what the outcome will be. When these too big to fail banks choose right, they make billions. When they don't, they make take the world economy down with them. Over the last forty days, JP Morgan lost at least $2 billion. This is just a small amount of the total market which is estimated somewhere between 600 trillion and 1.5 quadrillion dollars, or more money than the entire planet has. When this bubble bursts, and many (like DHS) think it will, the Depression that will result will make the last one on the thirties look like tame in comparison.
The MSM keeps telling us it was a "bad bet." This would be a bad bet in same way that one of us went to casino with every dollar we had, plus the entire monetary value of everyone in the same town as me, and gambled with it. CEO Jamie Dimon admitted that the strategy was “flawed, complex, poorly reviewed, poorly executed and poorly monitored”. YOU THINK?
So if JP Morgan is doing this kind of crap, don't you think other banks are too?
Here's CNBC's explanation of what happened.
The failed hedge likely involved a bet on the flattening of a credit derivative curve, part of the CDX family of investment grade credit indices, said two sources with knowledge of the industry, but not directly involved in the matter. JPMorgan was then caught by sharp moves at the long end of the bet, they said. The CDX index gives traders exposure to credit risk across a range of assets, and gets its value from a basket of individual credit derivatives.The SEC has said they will investigate, of course after watching lots of porn and finding a way to not do anything of any substance as they have been known to do. As Wall Street CANNOT police themselves, as Dimon and others have suggested forcefully for years, new rules have to be implemented. But who is a bigger question as the bought and paid for government doesn't seem interested in fixing things either. Too bad the Consumer Protection Agency the worthless GOP keeps blocking funding for isn't around who could helped prevent this.
This point was underscored in a recent commentary by Henry Blodget of Business Insider….
Wall Street can’t be trusted to manage—or even correctly assess—its own risks.We have learned nothing from the economic collapse of 2008 and have continued to make the same mistakes. Wall St can take all the risks they want because they can screw the economy blue and the worst that will happen is they get fired. Meanwhile, we the taxpayers have to subsidize the gambling addiction. Where is the worthless Tea Party on this matter? Oh that's right they are too busy screaming about gay people getting married and spending on poor people. These retards probably don't even know what the derivative market is. Here's the official numbers for what each bank holds in derivative exposure loss:
This is in part because, time and again, Wall Street has demonstrated that it doesn’t even KNOW what risks it is taking.
In short, Wall Street bankers are just a bunch of kids playing with dynamite.
There are two reasons for this, neither of which boil down to “stupidity.”
- The first reason is that the gambling instruments the banks now use are mind-bogglingly complicated. Warren Buffett once described derivatives as “weapons of mass destruction.” And those weapons have gotten a lot more complex in the past few years.
The second reason is particularly insidious. The worst thing that can happen to a trader who blows a huge bet and demolishes his firm—literally the worst thing—is that he will get fired. Then he will immediately go get a job at a hedge fund and make more than he was making before he blew up the firm.
- The second reason is that Wall Street’s incentive structure is fundamentally flawed:Bankers get all of the upside for winning bets, and someone else—the government or shareholders—covers the downside.
JPMorgan Chase – $70.1 Trillion
Citibank – $52.1 Trillion
Bank of America – $50.1 Trillion
Goldman Sachs – $44.2 Trillion
Plus, the derivatives losses have been illegally put onto FDIC backs meaning if the market collapses, your 401K, and any bank assets you have, will disappear overnight. Anyone having large, medium or small sums of money in any banks will get nothing back. Feel better yet? This could be just the start of what might be an earth shattering economic collapse.
Add to this with the news today, that since elections have been called off in Israel, they are ready to attack Iran at a moment's notice. Here's the link to RT news
http://rt.com/usa/news/us-attack-iran-strike-036/
As I stated in an earlier article, an attack could occur sometime in the May/June time period, although something still tells me August/September is more likely. Either way, WW3 may follow any attack on Iran if the Russian get involved, which they very well may. US officials are said to be scrambling to prevent such an attack, especially during an election season.
On top of all of that comes word the the Fukishima disaster may be even worse than thought. Tokyo News is reporting high levels of cancers, as well as other health issues in the Tokyo area. Several scientists have come forward and said that if the waste pool in reactor four collapses, the ensuing radiation could wipe out all life on the planet.
None of that is good news. The one thing I will leave you with on some sort of hope is that the national polls that show Romney leading Obama by seven points is worthless. The state polls are all that matters and news for states like Ohio and Pennsylvania don't bode well for MittBott 2012. PA has gone blue the last five Presidential elections, due to high turnout and democratic presence in the Philly area. Ohio is still stinging from the GOP attempt to get rid of unions which may have backfired as Obama leads in most polls in the state. Only a handful of states matter and in almost all of them, Obama is leading. Obama may not be the greatest president or even a good one, but he will certainly be better than handing the GOP the keys to the country and watch them total it yet again. I hate to say it but Obama 2012. God I feel dirty.
Does the topic has to do with your professional status or maybe is it mostly about your hobbies and ways to spend your leisure time?
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