JP Morgan Down $17 Billion

http://www.forbes.com/sites/petercohan/2012/05/12/how-jpmorgan-lost-17-5-billion/

Yesterday JP Morgan was down 2 billion.  Today they are now down 17 billion.  Can’t wait to read tomorrows news.

This story is convoluted and difficult to understand.  Not even the “experts” really understand it.  Every article I read is a lot of words and no details as to how you lose billions and billions of dollars.  

Basically JP Morgan was offering insurance to investors who invested in big risky companies (RR Donnelly is one of them) Then there was some manipulation and deception and rival hedge funds started getting annoyed and betting against JP Morgan causing everything to unravel.  It is still unraveling.  

There are derivatives involved.  There are credit default swaps involved.  There is a lot of betting involved.  Pretty much all the things that created the 2008 crisis (which were supposedly fixed (wink wink)) are still happening and achieving the same results.  

All the fans of deregulation can stand up and take another bow as another bank catastrophe unfolds before our eyes.

http://www.cbsnews.com/video/watch/?id=4501762n

60 minutes warned the world about Derivatives back in 1995.  17 years ago they told the world these things could bring down the banking system.  They explained that nobody knows what these things are.  Nobody knows what they do.  Nobody controls them.  Obviously nobody (but me) was paying attention 17 years ago because here we are talking about how JP Morgan has lost 17 billion dollars (in 6 weeks) because of derivatives.

Funny how this stuff always happens in a presidential election year.