Employees are being told that they may apply for other positions now.
Speculation is that this is also in response to position limits and other reforms in the Commodity Markets spearheaded by Commissioner Bart Chilton which will make it more difficult for large players to dominate the short term markets through sheer position size.
It is not clear if JPM will be exiting all markets at the same time including gold and silver in addition to other commodities.
We will look for clarification from their official statement which has not yet been issued.
According to a person who has been briefed, JPM will eventually be shutting down ALL proprietary trading in all markets in response to financial reform. This will include fixed income and equities which are much larger departments at the bank.
JPM recently suffered heavy losses in their proprietary commodity trading provoking a high level review by top executives.
JPM may continue to deal in these markets for commercial and private customers. They will cease trading for their own book.
It will be interesting to see what JPM does with RBS Sempra, a commodities company which they acquired earlier this year.
Bloomberg JPMorgan Said to End Proprietary Trading to Meet Volcker Rule By Dawn Kopecki and Chanyaporn Chanjaroen
Aug 31, 2010 4:45 PM ET
JPMorgan Chase & Co., the second- largest U.S. lender by assets, told traders who bet on commodities for the firm’s account that their unit will be closed as the company begins to shut down all of its proprietary trading, according to a person briefed on the matter.
The bank eventually will end all proprietary trading to comply with new U.S. curbs on investment banks, said the person, who asked not to be identified because
“FASCISM SHOULD MORE APPROPRIATELY BE CALLED CORPORATISM, AS IT IS THE MERGER OF CORPORATE AND GOVERNMENT POWER. THE TWENTIETH CENTURY WILL BE KNOWN IN HISTORY AS THE CENTURY OF FASCISM. DEMOCRACY IS BEAUTIFUL IN THEORY; IN PRACTICE IT IS A FALLACY. SOCIALISM IS A FRAUD, A COMEDY, A PHANTOM, A BLACKMAIL. FOR FASCISM THE STATE IS ABSOLUTE, INDIVIDUALS AND GROUPS ARE RELATIVE. IT BELIEVES NEITHER IN THE POSSIBILITY NOR THE UTILITY OF PEACE. FASCISM IS A RELIGION." BENITO MUSSOLINI
Note to Blythe Masters: Sorry to hear about your losses in the coal market because of a ‘rookie error’ in taking on overlarge positions, but an epic short squeeze is coming for your massive and untenable positions in silver and gold, and hell is coming with it.
And the vampire squid and its minions are going to wrap themselves around your neck, and inexorably suck the life from you, while the hedge funds lick your wounds. Your protectors in the government will not even return your calls, because they will be running for their own lives away from the disaster that you created, denying all knowledge of it, any of it.
Blythe Masters, JPMorgan Chase & Co.’s head of commodities, sought to reassure her team on an internal conference call after “extremely difficult” dismissals, defections and a first half in which some results were as much as 20 percent below expectations.
“Don’t panic,” she said in summing up the 35-minute call, a recording of which was obtained by Bloomberg News. “No one’s going to get screwed. We’re not going to do crazy things on compensation at the end of the year.”
Masters, who was named to run the business in late 2006, said the bank began dismissals on July 21, a day before the call, to trim overlap after buying parts of RBS Sempra Commodities LLP. The bank cut less than 10 percent of the combined front office, even as the oil unit lost “key people” who needed to be replaced, she said. She was discussing results with top executives after “we made a bit of
And I have pointed out that (1) the giant banks will make a killing on carbon trading, (2) while the leading scientist crusading against global warming says it won’t work, and (3) there is a very high probability of massive fraud and insider trading in the carbon trading markets.
Now, Bloomberg notes that the carbon trading scheme will be centered around derivatives:
The banks are preparing to do with carbon what they’ve done before: design and market derivatives contracts that will help client companies hedge their price risk over the long term. They’re also ready to sell carbon-related financial products to outside investors.
[Blythe] Masters says banks must be allowed to lead the way if a mandatory carbon-trading system is going to help save the planet at the lowest possible cost. And derivatives related to carbon must be part of the mix, she says. Derivatives are securities whose value is derived from the value of an underlying commodity — in this case, CO2 and other greenhouse gases…
Who is Blythe Masters?
She is the JP Morgan employee who inventedcredit default swaps, and is now heading JPM’s carbon trading efforts. As Bloomberg notes (this and all remaining quotes are from the above-linked Bloomberg article):
Masters, 40, oversees the New York bank’s environmental businesses as the firm’s global head of commodities…
As a young London banker in the early 1990s, Masters was part of JPMorgan’s team developing ideas for transferring risk to third parties. She went on to manage credit risk for JPMorgan’s investment bank.
Among the credit derivatives that grew from the bank’s early efforts was the credit-default swap.
Some in congress are fighting against carbon derivatives:
“People are going to be cutting up carbon futures, and we’ll be in trouble,” says Maria Cantwell, a Democratic senator from Washington state. “You can’t stay ahead of the next tool they’re going to create.”
Cantwell, 51, proposed in November that U.S. state governments be given
But but but Tim Cook said AAPL was "optimistic" about China!!!
China started the shenanigans by devaluing the Yuan fix by the most since the August collapse...sending a loud and clear message to The Fed - if you normalize rates (and strengthen the USD) we will unleash 'wealth-destroying' volatility...
The message is being heard among the pajama traders...
Today the Institute for Supply Management published its latest Non-Manufacturing Report. The headline NMI Composite Index is at 55.7 percent, up 1.2 percent from last month's seasonally adjusted 54.5 percent. Today's number came in above the Investing.com forecast of 54.7 percent.
Here is the report summary:
"The NMI® registered 55.7 percent in April, 1.2 percentage points higher than the March reading of 54.5 percent. This represents continued growth in the non-manufacturing sector at a slightly faster rate. The Non-Manufacturing Business Activity Index dec...
Many like to watch the price action of Junk Bonds, because they can send important messages about the strength or lack of in the stock market. Below looks at Junk Bond ETF JNK
CLICK ON CHART TO ENLARGE
As you can see, JNK looks to have created a double top in 2013 and 2014 and weakness in the sector soon followed. Once weakness really started to take place in this sector (2015), stocks didn’t have much luck moving higher.
JNK created a bullish reversal pattern (bullish wick pattern) the week of 2/5 and started turning high...
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Remember this? It was Monday. PRGO is down from around $130 to under $100 since I started following it LAST WEEK. That's down almost 25% in a week, and almost 50% in the last year. So I wrote,
"Perrigo CEO Joseph Papa leaves Perrigo (PRGO) to lead Valeant (VRX) while PRGO issues a warning about missing earnings expectations. Not surprisingly, PRGO stock plummeted today.
Robert Ingram, Chairman of the [Valeant] Board, stated, "The Board has conducted a thorough search process and believes that Joe is the ideal leader for Valeant at this time. He has a strong shareholder orientation,...
Although we try to stay focused on finding and managing promising trade ideas, the comments in the comment section sometimes take a political turn (for access, try PSW — click here!). So today, Jean Luc writes,
The GOP debate last night was just unreal – are these people running to be president of the US or to lead a college fraternity! Comparing tool size? The only guy that looks semi-sane is Kasich. The other guys are just like 3 jackals right now.
And something else – if Trump is the candidate, that little Romney speech yesterday is probably already being made into a commercial. And all these little snippets from the debate will also make some nice ads! If you are a conservative, you have to be scared now.
Phil writes back,
I was expecting them to start throwing poop at each other &n...
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at email@example.com with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
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