All Things in Moderation

Morning Report 6/13/12

14 Responses

1. 

   ScottC, on June 13, 2012 at 8:21 am said:

   Jamie Dimon now tesifying.

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2. 

   Brent Nyitray, on June 13, 2012 at 8:25 am said:

   Have you looked closely at this trade? Was it mainly selling short-term vol to buy long term vol (I am looking at CDS as basically put protection against the market). In other words, were they basically doing a put spread, where they were reducing the cost of long-term protection by selling short-term protection? And once the market knew what was going on, the vol skew shifted?

   I am trying to relate the posi into an overall hedging strategy…

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     ScottC, on June 13, 2012 at 9:35 am said:

     Brent:

     Have you looked closely at this trade?

     I have not.

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     • 

       ScottC, on June 13, 2012 at 11:07 am said:

       I thought Dimon did a very good job. He was honest and humble about the loss, but did not let the committee browbeat him. My favorite moment was when he set the record straight on TARP…it was “forced upon us.”

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3. 

   lmsinca, on June 13, 2012 at 8:51 am said:

   I’m not complaining but you guys do realize you’re speaking in some kind of secret code right, assuming Scott answers that is. Also, I can’t tell you how many acronyms I’ve looked up over the past months, and then I forget what they were when I see them again and have to look them up a second and third time. It’s no wonder the rest of us have no clue what to do with our money, if we have any extra………;>)

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4. 

   Brent Nyitray, on June 13, 2012 at 8:53 am said:

   lms, point taken. Are my posts inscrutable as well, or is just when we get into the weeds in the comments?

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5. 

   lmsinca, on June 13, 2012 at 9:05 am said:

   I understand the posts fine for the most part and try to follow some of the links as I’m interested in this stuff. And you’re more than entitled to be in the weeds, I just thought you might want to know that at least for myself, I have no clue what you’re actually talking about. I have the same problem with some of the lawyer posts and comments. My background is science and psychology so I’m pretty far removed from the technical economic and legal lingo. I’m trying to learn as time and interest allow though. Sometimes I think my interests are almost too broad and my brain no longer has room for all this information. I’m pretty sure I’m not getting senile yet, but my memory doesn’t seem to be what it used to be…………… 🙂

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6. 

   lmsinca, on June 13, 2012 at 9:07 am said:

   What does posi mean?

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7. 

   Brent Nyitray, on June 13, 2012 at 9:09 am said:

   posi = position.

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8. 

   lmsinca, on June 13, 2012 at 9:14 am said:

   Thanks, I was thinking positive and it really didn’t make sense.

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9. 

   Brent Nyitray, on June 13, 2012 at 11:09 am said:

   Did he say WaMu was forced upon him too?

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   • 

     ScottC, on June 13, 2012 at 11:23 am said:

     Brent:

     Did he say WaMu was forced upon him too?

     Of course not. Wouldn’t you have done that deal willingly?

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10. 

    jnc4p, on June 13, 2012 at 2:26 pm said:

    With regards to Jamie Dimon, this is worth a reread regarding how much the conventional wisdom has changed:

    “The Banker Who Saved Wall Street
    Sep 10, 2009 8:00 PM EDT
    How JPMorgan Chase CEO Jamie Dimon bailed out Bear Stearns and the federal government—and lived to turn a profit.

    On the morning of Sept. 18, 2008, the phone rang in Jamie Dimon’s office on the 48th floor of JPMorgan Chase’s New York headquarters. It was Hank Paulson, the secretary of the Treasury, who for the second time in six months had a pressing question: would Dimon be interested in acquiring the floundering investment bank Morgan Stanley—at no cost whatsoever?

    The call came at a tumultuous moment. Stocks had fallen 27 percent between Aug. 29 and Sept. 10. Lehman Brothers had already failed, Merrill Lynch had been sold to Bank of America, and AIG had received an emergency loan of $85 billion from the federal government. The only remaining question was whether it would be Morgan Stanley or Goldman Sachs to fail next. The government was desperately seeking to stave off a total wipeout of Wall Street. And here was Paulson offering Dimon the chance to own Morgan Stanley for absolutely nothing. At the government’s urging, Dimon had agreed to take over Bear Stearns in March in a whirlwind 48-hour deal, a transaction that established Dimon as the government’s banker of last resort. “Some are coming to Washington for help,” Sheila Bair, chairman of the Federal Deposit Insurance Corp., later said. “Others are coming to Washington to help.””

    http://www.thedailybeast.com/newsweek/2009/09/10/the-banker-who-saved-wall-street.html

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11. 

    jnc4p, on June 13, 2012 at 4:39 pm said:

    Local governments ought to be prohibited from selling streams of city revenue for time periods that exceed their term of office:

    http://www.rollingstone.com/politics/blogs/taibblog/new-york-to-repeat-chicago-s-parking-meter-catastrophe-20120613

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