JP Morgan Managers Being Told Trade Loss is $9 Billion, Moody’s Could Cut Further

June 28, 2012 By 14 Comments

The day after Jamie Dimon went public with JPM’s losing CIO derivatives hedge our sources informed us JP Morgan’s actual losses were $100 billion.
The Fed’s latest stress test indicated $32 billion in potential derivatives losses for JPM.

Those two figures are becoming more accurate by the day as JPM managers are reportedly now admitting that the losses have grown to $9 billion, and the trade has yet to be unwound.

We are starting to talk real money as $9 billion is 2 quarters of JPM’s net income!
If JP Morgan actually reports CIO losses in the range of $9 billion (we expect accounting gimmicks such as litigation reserves to obscure the true losses) expect Moody’s to downgrade The Morgue further.

 

Banking competitors are trying to lure away top talent at JP Morgan by highlighting the recent prop trading losses are likely to affect bonues and Jamie Dimon isn’t being honest about how bad the loss will be. On July 13th the banking giant will announce 2nd quarter earnings and a real-time number is expected on how many billions net income gets wacked with because the London whale trade has been wound down or they’re willing to admit how bad the wind down will be. Last week Mark DeCambre at the New York Post wrote his JPM sources expect the loss to be between $4-6 billion – JPM’s estimate in May was only $2bn. But I heard this week JPM managing directors are being told it’s more. To the tune of $9 billion – Ouch!
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Check out these similar articles:

  1. JPM’s CIO Loss Widens to $5 Billion
  2. Margin Call? JP Morgan Sells $25 Billion in Securities to Offset Derivatives Losses
  3. ISI Estimates JPM to Report $4.2 Billion CIO Loss in Q2, Could Still Grow
  4. JPMorgan Reports $2 Billion Loss on Synthetic Positions
  5. Morgan Stanley Defaults on $3.3 Billion Tokyo Property
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Comments

  1. Avatar of silverbullion silverbullion says:
    June 28, 2012 at 10:21 AM

    I would love to hear what JP Morgan’s shareholders have to say about it.

  2. Avatar of Silvergood1 Silvergood1 says:
    June 28, 2012 at 10:44 AM

    THE TRUE LOSS WILL BE CLOSE TO 100 BILLION !!!!

    These banks are extremely corrupt.  Get your money out of all US banks now.  Just keep enough to pay operational expenses and convert the rest into silver.

  3. Avatar of aragornsos aragornsos says:
    June 28, 2012 at 10:49 AM

    Wish it were that easy to pull the money out.  Facing “you’re crazy / you’re having a mid-life crisis” from family (including wifey, who simply wants to stay part of the sheeple so she’s happy), so it’s gonna happen for me only in dribs and drabs.

    But hey, whatever I end up with when it all collapses, be it 80 or 100 or 200 or whatever ounces, that’s STILL more than 99.9% of the people out there have.

    and BONUS!  Went thru a huge pile of change I found in a box yesterday, and found a 1962 Roosevelt Dime (my daughter did actually) along with 3-4 dozen acutal copper pennies (pre 1982) which have melt value of 2.2cents each or so.  Great opportunity to teach the wee one about Constitutional money and why old coins with actual silver and copper have HIGHER worth (melt value, never mind numismatic) than the current ones which aren’t even valued at thier face value.

  4. Avatar of TimeForSomeFun TimeForSomeFun says:
    June 28, 2012 at 12:30 PM

    You can bet JPM shareholders are getting nervous.  I’m working on one here at work trying to convince him to at least pull out his original investment and put it in silver – a win win situation.  It’s taking time, but I am definitely getting through to him.

  5. Avatar of silverbullion silverbullion says:
    June 28, 2012 at 12:50 PM

    TFSF Good luck.

  6. Avatar of silverbullion silverbullion says:
    June 28, 2012 at 1:14 PM

    aragornsos A bonus indeed! :-)

    You’re right, it’s not easy, although I cannot complain too much, my close family (wife and kids) are fully onboard. My wife allows me to fully manage our household according to the Way. I am going to take our two year old to a coin show on Saturday, and needless to say, she is a silver stacker herself. lol She’s probably the youngest silver stacker in South Africa.

    Right on, it is better to have “80 or 100 or 200 or whatever ounces”, than not having anything to fall back on.

  7. Avatar of AGXIIK AGXIIK says:
    June 28, 2012 at 1:27 PM

    Morgan Stanley is set up to the the first TBTF to go down as a sacrificial lamb.  Goldman Sach  likely will be next. B of A is a zombie bank and JPM will be the last to go.  IMO   These banks will be hit very hard within 4 months.  September is the worst month for bank failures followed by October.  That’s about 75 days and a wake up before the dominos start falling.  Bunker in.

  8. Avatar of zinc zinc says:
    June 28, 2012 at 2:56 PM

    so more like 90 billion when you include the off balance sheet derivatives

  9. Avatar of 427 427 says:
    June 28, 2012 at 7:39 PM

    Two weeks ago Jake was calculating JPM lose had climbed to 10 billion. So I would say the news there letting out is slow in coming by a few weeks. So what is the loses today? Maybe the below article is going to be used for JPM instead 

    Geithner and Bernanke Demand New Mega-Bailout of Europe

    Capitol Hill sources have confirmed that Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke are demanding that Congress prepare emergency legislation for yet another hyperinflationary bailout of the hopelessly bankrupt trans-Atlantic financial system. For the past week, the two men have been meeting secretly with leading Congressional Democrats and Republicans, demanding that they draft new legislation to bailout the banks on an even larger scale than after the 2008 collapse.

  10. Avatar of Marchas45 Marchas45 says:
    June 28, 2012 at 8:01 PM

    Here! Here! 427 on that post about Jake reporting the TRUTHFUL loses of JPM we don’t seem to be getting any great up to date information anymore since Jake’s been gone, great loss as far as I’m concerned. The guy is a wiz on calculating shit like that.  Hear that Doc.

  11. Avatar of 427 427 says:
    June 28, 2012 at 8:14 PM

    Ya M45;

    And calculating all the short the get accumulated and predicting there move with all the stats he stored up. 
  12. Avatar of ricin3000 ricin3000 says:
    June 28, 2012 at 8:54 PM

    Expect silver (the SLV and the like) to drop more, as much as they can to make whole on the (other) derivatives. Year-low weekend already coming up, 2-yr low weekend very possible.
    IMHO,
    R3K  

  13. Avatar of ricin3000 ricin3000 says:
    June 28, 2012 at 9:01 PM

    Ag, Me thinks Goldman will be the last one standing. Because it was engineered that way.

    Perhaps I’m just getting carried away, but if I combine the hard “market” (cough) news with the somewhat more esoteric or conspiracy ways of thinking, I have the feeling GS is meant to end on top. Don’t they own most of EUR by now…

    Best,

    R3K

  14. Avatar of Ed_B Ed_B says:
    June 29, 2012 at 12:47 AM

    ”
    so more like 90 billion when you include the off balance sheet derivatives”


    Is it?  What I am wondering is whether or not these JPM loss numbers include their 40-50:1 leverage.  :-O

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