JP Morgan's manipulation woes

kevsta · 17th July 2012, 01:06 AM

As you are probably aware JP Morgan are one of the implicated banks in the LIBOR manipulation case and are currently under investigation, but admitting nothing as yet.

however you may not (yet) be aware of the further deep excrement that they are also in regarding the (alleged - they wouldn't do that, would they?

) manipulation of the global CDS market.

this is a BIG deal because a loss of confidence in the CDS market at this point in the financial crisis, is not exactly ideal.

once again story first broken as "speculation" by (ex CDS traders) ZH and admitted by JPM in their earnings report days ago

Quote:

'the recently discovered information raises questions about the integrity of the trader marks, and suggests that certain individuals may have been seeking to avoid showing the full amount of the losses being incurred in the portfolio during the first quarter. As a result, the Firm is no longer confident that the trader marks used to prepare the Firm's reported first quarter results (although within the established thresholds) reflect good faith estimates of fair value at quarter end."

the criminal investigation has now started

from Reuters

Quote:

Before last week's disclosure, the criminal probe largely had focused on the personal trading of some CIO traders, two of those sources said. The authorities were looking for evidence that some in London may have sold shares of JPMorgan in advance of the firm's May 10 disclosure that it could lose a minimum of $2 billion on the derivatives trades gone awry.

Now the investigation is focused on whether three JPMorgan employees in London committed fraud in reporting on their transactions. The bank is cooperating with authorities.

I think there should be an independent investigation into the global financial system as a whole to establish what, (if anything) is actually real.

UndercoverElephant · 17th July 2012, 01:44 AM

Originally Posted by kevsta

I think there should be an independent investigation into the global financial system as a whole to establish what, (if anything) is actually real.

Yes, of course there should be, but there won't be. However, it looks like enough of the truth has now already leaked out that it is not going to be possible to stop more following. And it doesn't really matter whether it all comes out in one go, or in a drip-drip, because there's only one way this thing is going now. We've had nearly four years of The System being patched up, lied about, rigged, etc... in an attempt to keep it going. The Powers That Be have actually done a pretty impressive job at kicking the various cans down the road (if "impressive" is the right word), but now the that system really is pranged because, as you say, nobody is sure what is real anymore.

It was always obvious that TPTB would try to keep the system limping along until we know who is going to be the next president of the US. The big question now is whether they can actually do this, or whether events in the eurozone or elsewhere will precipitate the global endgame before then.

kevsta · 17th July 2012, 03:33 AM

I would like the JP Morgan / ESF / Fed connection and market operations to come under independent scrutiny. I wont however be holding my breath.

UndercoverElephant · 17th July 2012, 03:59 AM

Originally Posted by kevsta

I would like the JP Morgan / ESF / Fed connection and market operations to come under independent scrutiny. I wont however be holding my breath.

[crystal ball]
The way this is heading, I think the real scrutiny can't come. If there was "real scrutiny" of LIBOR submissions next time there is a major financial shock (which is guaranteed happen at some point in the coming weeks/months) then there wouldn't be LIBOR rate, because many of the banks involved simply won't be able to get overnight loans at all. At that point, if people don't rig the official statistics, we are heading towards a "fast crash" scenario where the digital financial system stops working, and has to be suspended, followed by an unscheduled "bank holiday" leading to God only knows what. More likely "they" will rig the figures anyway, even though they know the world is watching and that everybody knows the figures are fictional. And that leads us towards an unreal situation where the financial system is still operating (sort of), but that everybody knows the whole thing is a fraud. That in turn in likely to lead to a physical run on the banks. A digital run can be responded to by creating more digital money with the stroke of a key; actual physical money has to be printed, and it will take no time at all for the banking system to run out of banknotes.
[/crystal ball]

Reality calling....reality calling...

Aber · 17th July 2012, 02:59 PM

They will only run out of banknotes if they are stuffed into matresses - if they are deposited in 'good' banks then they will be recycled. If there is still a run then expect deposit insurance to be government backed up to higher limits.

UndercoverElephant · 17th July 2012, 04:20 PM

Originally Posted by Aber

They will only run out of banknotes if they are stuffed into matresses - if they are deposited in 'good' banks...

That's what I'm saying - there wouldn't be any "good" banks at that point, and people will suddenly find CASH very attractive. No good in the long run because of inflation, but if you want to make sure you've got enough short-to-medium term liquidity then it's mattress time.

17th July 2012, 01:06 AM	#1
kevsta RBL CHeck Failed Join Date: Jun 2007 Location: in the shadows Posts: 2,395	JP Morgan's manipulation woes As you are probably aware JP Morgan are one of the implicated banks in the LIBOR manipulation case and are currently under investigation, but admitting nothing as yet. however you may not (yet) be aware of the further deep excrement that they are also in regarding the (alleged - they wouldn't do that, would they? ) manipulation of the global CDS market. this is a BIG deal because a loss of confidence in the CDS market at this point in the financial crisis, is not exactly ideal. once again story first broken as "speculation" by (ex CDS traders) ZH and admitted by JPM in their earnings report days ago Quote: 'the recently discovered information raises questions about the integrity of the trader marks, and suggests that certain individuals may have been seeking to avoid showing the full amount of the losses being incurred in the portfolio during the first quarter. As a result, the Firm is no longer confident that the trader marks used to prepare the Firm's reported first quarter results (although within the established thresholds) reflect good faith estimates of fair value at quarter end." the criminal investigation has now started from Reuters Quote: Before last week's disclosure, the criminal probe largely had focused on the personal trading of some CIO traders, two of those sources said. The authorities were looking for evidence that some in London may have sold shares of JPMorgan in advance of the firm's May 10 disclosure that it could lose a minimum of $2 billion on the derivatives trades gone awry. Now the investigation is focused on whether three JPMorgan employees in London committed fraud in reporting on their transactions. The bank is cooperating with authorities. I think there should be an independent investigation into the global financial system as a whole to establish what, (if anything) is actually real.
	__________________ "The world will soon wake up to the reality that everyone is broke and can collect nothing from the bankrupt, who are owed unlimited amounts by the insolvent, who are attempting to make late payments on a bank holiday in the wrong country, with an unacceptable currency, against defaulted collateral, of which nobody is sure who holds title." - Anonymous

17th July 2012, 01:44 AM	#2
UndercoverElephant Pachyderm of a Thousand Faces Join Date: Jan 2002 Location: Sussex, England Posts: 9,060	Originally Posted by kevsta I think there should be an independent investigation into the global financial system as a whole to establish what, (if anything) is actually real. Yes, of course there should be, but there won't be. However, it looks like enough of the truth has now already leaked out that it is not going to be possible to stop more following. And it doesn't really matter whether it all comes out in one go, or in a drip-drip, because there's only one way this thing is going now. We've had nearly four years of The System being patched up, lied about, rigged, etc... in an attempt to keep it going. The Powers That Be have actually done a pretty impressive job at kicking the various cans down the road (if "impressive" is the right word), but now the that system really is pranged because, as you say, nobody is sure what is real anymore. It was always obvious that TPTB would try to keep the system limping along until we know who is going to be the next president of the US. The big question now is whether they can actually do this, or whether events in the eurozone or elsewhere will precipitate the global endgame before then.
	__________________ "I am real!" said Alice, and began to cry. "You won't make yourself a bit realler by crying," Tweedledee remarked: "there's nothing to cry about."

17th July 2012, 03:33 AM	#3
kevsta RBL CHeck Failed Join Date: Jun 2007 Location: in the shadows Posts: 2,395	I would like the JP Morgan / ESF / Fed connection and market operations to come under independent scrutiny. I wont however be holding my breath.
	__________________ "The world will soon wake up to the reality that everyone is broke and can collect nothing from the bankrupt, who are owed unlimited amounts by the insolvent, who are attempting to make late payments on a bank holiday in the wrong country, with an unacceptable currency, against defaulted collateral, of which nobody is sure who holds title." - Anonymous

17th July 2012, 03:59 AM	#4
UndercoverElephant Pachyderm of a Thousand Faces Join Date: Jan 2002 Location: Sussex, England Posts: 9,060	Originally Posted by kevsta I would like the JP Morgan / ESF / Fed connection and market operations to come under independent scrutiny. I wont however be holding my breath. [crystal ball] The way this is heading, I think the real scrutiny can't come. If there was "real scrutiny" of LIBOR submissions next time there is a major financial shock (which is guaranteed happen at some point in the coming weeks/months) then there wouldn't be LIBOR rate, because many of the banks involved simply won't be able to get overnight loans at all. At that point, if people don't rig the official statistics, we are heading towards a "fast crash" scenario where the digital financial system stops working, and has to be suspended, followed by an unscheduled "bank holiday" leading to God only knows what. More likely "they" will rig the figures anyway, even though they know the world is watching and that everybody knows the figures are fictional. And that leads us towards an unreal situation where the financial system is still operating (sort of), but that everybody knows the whole thing is a fraud. That in turn in likely to lead to a physical run on the banks. A digital run can be responded to by creating more digital money with the stroke of a key; actual physical money has to be printed, and it will take no time at all for the banking system to run out of banknotes. [/crystal ball] Reality calling....reality calling...
	__________________ "I am real!" said Alice, and began to cry. "You won't make yourself a bit realler by crying," Tweedledee remarked: "there's nothing to cry about."

17th July 2012, 02:59 PM	#5
Aber Thinker Join Date: Apr 2011 Posts: 148	They will only run out of banknotes if they are stuffed into matresses - if they are deposited in 'good' banks then they will be recycled. If there is still a run then expect deposit insurance to be government backed up to higher limits.
Aber Thinker Join Date: Apr 2011 Posts: 148

17th July 2012, 04:20 PM	#6
UndercoverElephant Pachyderm of a Thousand Faces Join Date: Jan 2002 Location: Sussex, England Posts: 9,060	Originally Posted by Aber They will only run out of banknotes if they are stuffed into matresses - if they are deposited in 'good' banks... That's what I'm saying - there wouldn't be any "good" banks at that point, and people will suddenly find CASH very attractive. No good in the long run because of inflation, but if you want to make sure you've got enough short-to-medium term liquidity then it's mattress time.
	__________________ "I am real!" said Alice, and began to cry. "You won't make yourself a bit realler by crying," Tweedledee remarked: "there's nothing to cry about."