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Live Senate Hearing On JPMorgan Prop Trading Loss

Tyler Durden's picture


Sadly the man who thought (with good reason) he was more important than the Chairsatan (until the whole CIO fiasco blew up in his face of course), Jamie Dimon, will not be there (and will thus not be available to provide an update on the CIO's losses to date, which are likely orders of magnitude greater than the $2 billion benchmark previously disclosed, but that does not mean today's Senate hearing on lack of regulatory oversight and massive bank prop losses will be any less interesting. From C-Span: "The Senate Banking Committee will hold an oversight hearing on efforts to overhaul the regulation of derivatives. Lawmakers will focus on the steps the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) are taking to implement provisions of the Dodd-Frank Wall Street Reform Act, and their efforts to reduce systemic risk and improve market oversight. The session also will spotlight J.P. Morgan Chase's $2 billion trading loss, which is under investigated by the FBI and the SEC." We, for one, can't wait to find out what the FBI's trained CDS forensic experts discover on this one...

From the Senate Banking Committee:

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS will meet in OPEN SESSION to conduct a hearing on “Implementing Wall Street Reform: Enhancing Bank Supervision and Reducing Systemic Risk.” The witnesses will be: The Honorable Neal S. Wolin, Deputy Secretary, U.S. Department of the Treasury; The Honorable Daniel K. Tarullo, Member, Board of Governors of the Federal Reserve System; The Honorable Tom Curry, Comptroller of the Currency, Office of the Comptroller of the Currency; The Honorable Martin J. Gruenberg, Acting Chairman, Federal Deposit Insurance Corporation; and The Honorable Richard Cordray, Director, Consumer Financial Protection Bureau.

Those who will be testifying:

    The Honorable Neal S. Wolin
    Deputy Secretary, U.S. Department of the Treasury

    The Honorable Daniel K. Tarullo
    Member, Board of Governors of the Federal Reserve System

    The Honorable Thomas J. Curry
    Comptroller of the Currency, Office of the Comptroller of the Currency

    The Honorable Martin J. Gruenberg
    Acting Chairman, Federal Deposit Insurance Corporation

    The Honorable Richard Cordray
    Director, Consumer Financial Protection Bureau

Live webcast below, begins at 10 am Eastern (also live on C-Span 3):


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Wed, 06/06/2012 - 10:00 | 2499049 midgetrannyporn
midgetrannyporn's picture

The FBI and SEC will be busy licking Dimon's sack.

Wed, 06/06/2012 - 10:03 | 2499068 battle axe
battle axe's picture

Or a reach around...

Wed, 06/06/2012 - 10:06 | 2499085 Pladizow
Pladizow's picture

A further waste of tax payer money!

Wed, 06/06/2012 - 10:08 | 2499098 Global Hunter
Global Hunter's picture

Actually if ended and went no further than felatio we'd all be a lot better off

Wed, 06/06/2012 - 10:34 | 2499207 Colombian Gringo
Colombian Gringo's picture

Of course Dimon didn't show up, since the conclusions are predetermined. Dimon will make more money, JPM will be bailed out, and US taxpayers will foot the bill, ass fisted again by the banksters.

Wed, 06/06/2012 - 11:49 | 2499576 hedgeless_horseman
hedgeless_horseman's picture



Can I get some Freedom Fries with this Big Nothingburger?

Wed, 06/06/2012 - 13:01 | 2499905 Papasmurf
Papasmurf's picture

With a 15 oz "double shot" coke.

Wed, 06/06/2012 - 13:29 | 2500022 Hugh_Jorgan
Hugh_Jorgan's picture

Actually, I'm pretty thirsty I think I'll take the big upgrade to the newly resized NYC 15.9oz "Double Gulp"

Wed, 06/06/2012 - 12:24 | 2499747 eatthebanksters
eatthebanksters's picture

I'm almost looking forward to the 'GREAT RESET'.  Maybe then some real justice will be doled out.  I am amazed at the mindset of people like Geithner and Summers that we need to keep confidence in the financial system to keep it from imploding.  My question is how do we maintain our confidence when we know crooks like Dimon, Blankfein and Pandit (just to name a few) are in charge of so much of our money?  How do we remain confident when criminals aren't prosecuted for their crimes?  I guess morals, ethics and integrity don't have a place in the world of finance.

Wed, 06/06/2012 - 10:09 | 2499102 jcaz
jcaz's picture

LOL- yep, the fact that Dimon doesn't bother to show up himself says it all-  dog and pony show deluxe.....

Wed, 06/06/2012 - 10:05 | 2499080 Ruffcut
Ruffcut's picture

There are Business to Business relationships and other types towards consumers.

These sessions are Assholes to Assholes.

Wed, 06/06/2012 - 10:08 | 2499094 fiercekitty
fiercekitty's picture

LOL!!!!  Good one.  No, GREAT one!

Wed, 06/06/2012 - 10:05 | 2499083 LeBalance
LeBalance's picture

pindar position of fealty.

Wed, 06/06/2012 - 10:58 | 2499295 WallStreetClass...'s picture

Dimon teabags SEC, FBI....more at 11...

Wed, 06/06/2012 - 10:01 | 2499052 RobotTrader
RobotTrader's picture

Imagine the wild bets those guys are going to be making in order to "catch up" to their peers.

We are going to see a lot of JPM traders trying to "make their year" by buying low grade screamers off the lows.

Crappy names like Pulte Homes, already up 7% today.

Wed, 06/06/2012 - 10:08 | 2499078 razorthin
razorthin's picture

I took TNA and ERX yesterday, thank you.

Wed, 06/06/2012 - 10:09 | 2499103 CvlDobd
CvlDobd's picture

People are trading futures all night for big gains these days. That is my theory on the TPX collapse.

Wed, 06/06/2012 - 10:15 | 2499120 francis_sawyer
francis_sawyer's picture

The day AFTER the move, we'll be sure to hear about it from you...

Wed, 06/06/2012 - 10:01 | 2499054 Boilermaker
Boilermaker's picture

Who cares?

The DOW is soaring and so is my 401(k)?



Wed, 06/06/2012 - 10:06 | 2499075 GeneMarchbanks
GeneMarchbanks's picture

Great encapsulation of the general sentiment. Kudos.

Even so, it's always good to be able to talk about it for the sake of therapy.

Wed, 06/06/2012 - 10:07 | 2499092 Global Hunter
Global Hunter's picture

Retail you're the last one left, turn out the lights and close the door when you give up on this rigged game for good :)

Wed, 06/06/2012 - 10:09 | 2499101 fiercekitty
fiercekitty's picture

Just as I read your comment, the Van Halen song I am listening to proclaimed, "You'll get some leg tonight for sure!!"

Wed, 06/06/2012 - 10:13 | 2499114 CvlDobd
CvlDobd's picture

So you levered up at the 200 day just like the FRBNY? Well done retail!

Wed, 06/06/2012 - 10:02 | 2499057 Amish Hacker
Amish Hacker's picture

There's the problem in a nutshell: over-compensated and under-investigated.

Wed, 06/06/2012 - 10:07 | 2499090 rehypothecator
rehypothecator's picture

Under-investigated?!  They've held plenty of hearings on MF Global, but without a single indictment.  The real problem is that the criminals in government are too cozy with the criminals in corporations.  They're the same criminals, just going back and forth, and they look out for their own.  

Wed, 06/06/2012 - 10:59 | 2499297 Matt
Matt's picture

All animals are equal, but pigs are more equal.

Wed, 06/06/2012 - 11:07 | 2499328 Nobody For President
Nobody For President's picture

Didja notice how each and every one of the dudes testifying is titled: "The Honorable..."

Good thing truth in advertising laws don't apply.

Wed, 06/06/2012 - 10:14 | 2499118 JohnKozac
JohnKozac's picture

Could they ppleeze stop calling these people "Honorable"!

Wed, 06/06/2012 - 10:01 | 2499059 mess nonster
mess nonster's picture

Apparently, a coven of mongeese will now oversee the fox that rules the henhouse.

Wed, 06/06/2012 - 10:02 | 2499063 yabyum
yabyum's picture

I thought JP Organ had the best interests of their customers at heart.....fuck me!

Wed, 06/06/2012 - 10:04 | 2499073 midgetrannyporn
midgetrannyporn's picture


Wed, 06/06/2012 - 10:03 | 2499067 LeBalance
LeBalance's picture

/pardon off/

senators are bank empoyees.

theater of the absurd.

many words, tantilizing inferences, strong emotion, >>> meaningless

/pardon on/

it is no longer even amusing.

Wed, 06/06/2012 - 10:03 | 2499069 bigwavedave
bigwavedave's picture

You mean the F.B. Aii ?

Wed, 06/06/2012 - 10:03 | 2499070 razorthin
razorthin's picture

"Prop Trading Loss"

Ha!  No hedging there.  To the gallows!

Wed, 06/06/2012 - 10:05 | 2499081 Temporalist
Temporalist's picture

Gold and silver are both outperforming most major markets...again.


Soros and Paulson are bulish the precious belying the past articles.  EZ collapse my be approaching.

Gold Bugs Defy Bear-Market Threat With Soros Buying

Wed, 06/06/2012 - 10:11 | 2499110 fiercekitty
fiercekitty's picture

Ooooh, Spooky Dude is buying gold again!  Time to load up the boats.. :P

Wed, 06/06/2012 - 10:06 | 2499086 Global Hunter
Global Hunter's picture

Will they address Jamie Dimon as "Honorable Jamie Dimon" or is the term honorable reserved for people with government jobs rather than shadow government jobs?

Wed, 06/06/2012 - 10:30 | 2499183 GMadScientist
GMadScientist's picture

I'm sure he'd prefer Emperor, but in prison (yeah, right), he'll be known as "Gumby" (after some unfortunate encounters between his teeth and various hardened-steel obstacles).

Wed, 06/06/2012 - 10:07 | 2499091 mendolover
mendolover's picture

Wondering if there will be any mention of JPM's interest rate swap activity.  Doubting it.

Wed, 06/06/2012 - 10:14 | 2499116 DarkestPhoenix
DarkestPhoenix's picture

The article has a typo by saying JPM's loss is "under investigated" by the FBI/SEC.

On second thought, it's actually correct. 

Wed, 06/06/2012 - 10:45 | 2499257 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

"Freudian Slip!":)

Wed, 06/06/2012 - 10:16 | 2499121 Paul Atreides
Paul Atreides's picture

Honorable?!!?! what in the fuck have any of these guys done that his honorable...I would very much like to take my claymore to their jugulars and reclaim the word.

Wed, 06/06/2012 - 10:18 | 2499132 rehypothecator
rehypothecator's picture

Claymores being what they are, you could even take your claymore to their big toe and it would serve as well.  In any case, please do.  

Wed, 06/06/2012 - 11:47 | 2499564 Chaffinch
Chaffinch's picture

I think maybe one of you is talking about a Claymore which is a two- handed sword, and the other is talking about a Claymore which is an anti-personnel mine.
I'm not fussed which one gets used...

Wed, 06/06/2012 - 10:18 | 2499133 LULZBank
LULZBank's picture

Jamie playing Catch me if you can.

Wed, 06/06/2012 - 10:19 | 2499139 eclectic syncretist
eclectic syncretist's picture

Maybe they'll sanction JPM's negative reserve ratio.


FYI - Bank reserve requirements by various governments around the world.

Wed, 06/06/2012 - 10:20 | 2499141 marketcycles79
marketcycles79's picture
Citigroup - upgrade

major technical pattern explained.

Wed, 06/06/2012 - 10:21 | 2499146 Temporalist
Temporalist's picture

Without watching I can tell everyone what Jamie Dimon says:

"Don't blame the bankers."

Just like last year and the year before that...

Wed, 06/06/2012 - 10:23 | 2499151 optimator
optimator's picture

You'd think they could read better than that.  Didn't their masters rehearse them?  It looks like one of the old Politburo meetings.

Wed, 06/06/2012 - 10:25 | 2499158 f16hoser
f16hoser's picture

So when will the "real" wall street reform be forth coming? These hearings are pathetic!

Wed, 06/06/2012 - 11:03 | 2499314 Matt
Matt's picture

They are working to reform the system so the big banks go from practically guaranteed to make trading profits every single day, to actually guaranteed. Lossing money ever will be verboten. Any losses will require an instant mini-bailout.

The 'real'reform will come after a total break down in the market, maybe.

Wed, 06/06/2012 - 11:36 | 2499503 GMadScientist
GMadScientist's picture

After it's been razed and salted and not a day sooner.


Wed, 06/06/2012 - 10:27 | 2499170 theTribster
theTribster's picture

Johnson literally sounds like he can't read, almost retarded. Shelby should be in prison, he is one of the biggest criminals in Congress. And please with the fucking Dodd-Frank, prior to both of them leaving they managed to steal 10s of millions for themselves and let the banks steal Trillions! Needless to say they to should be in prison (or dead for treason). 

This committee will do nothing, this whole thing is a joke as they are NOT allowed to regulate the financial services sector. That's why Dodd-Frank is such a joke because for it to pass it HAS to be littered with loopholes that allow the financial institutions a way around the rules that are inconvenient.

If they wanted to fix things then they would put back Glass-Steagal which we know is extremely effective! Dodd-Frank is nothing more than legal cover for the banks to continue to steal and take on bigger and bigger risk. Johnson sounds like he might be drunk, listening to him is painful, thankfully he doesn't talk much. Embarrasing is what it is, one line of bullshit after another after another.

Just let the thing crash so we can reset and get on with it, you guys have zero intention of fixing any of these problems instead you will make sure that these companies are able to get away with more and more theft. Wow do I hate these people! Johnson must have a degree from Harvard or Yale....

Wed, 06/06/2012 - 10:33 | 2499190 ebworthen
ebworthen's picture

Nero does not have to appear before Rome's Senators.

The Senators instead will be questioning servants and message runners at the National Theater.

Wed, 06/06/2012 - 10:32 | 2499192 tony bonn
tony bonn's picture

this hearing is theater......nothing will come of it exccept to vent some frustration - and provide fodder for those who wish to have campaign material.....whenever the fbi is called in to investigate anything major, its role is to bury and exonerate.....bottom feeders will take the blame....

jpm's trading losses are are only tangentially related to european debt and derivatives....they are primarily related to interest rate swaps and the manically desperate attempt to suppress interest rates....the excess debt the treasury has been selling is to keep these swaps configured and from falling apart....unfortunately the towering columns of debt can no longer be is unraveling and will make europe's destruction look like a tame hiccup....

jpm's other duty is to prop up the  hopelessly insolvent deutsche bank....good luck on that....

the wheels of justice grind slowly, but grind they do. it will take a couple of years to fully plow jpm under but the irswaps will do it in.....

Wed, 06/06/2012 - 10:33 | 2499202 outamyeffinway
outamyeffinway's picture

The FBI isn't going to do shit. They've been reduced to an impotent, pansy ass organization that dare not speak up against their masters for fear of their paychecks being revoked.

Heaven forbid we had some patriots in the organization but anyone in the FBI will have to be satisfied with harassing domestic terrorists (citizens) until all of this blows over.

Of course when all of this blows over there may not be an FBI or a Federal gov't for that matter. Either way the organization should feel the shame from all of this inactiviy for decades if not centuries to come.

For shame, for shame. And we the tax payers pay your salaries to serve those who enslave you and us. Oh the irony.


Wed, 06/06/2012 - 10:42 | 2499240 Tuco Benedicto ...
Tuco Benedicto Pacifico Juan Maria Ramirez's picture

"We, for one, can't wait to find out what the FBI's trained CDS forensic experts discover on this one..."

Yeah, right!!  Ha, ha!  The foxes are investigating themselves.


I am Tuco

Wed, 06/06/2012 - 18:47 | 2501307 RECISION
RECISION's picture

No no, it's all fine...  the SEC is also investigating.

We can all relax now, everything will be alright.

Wed, 06/06/2012 - 10:41 | 2499235 adr
adr's picture

The only senate hearing worth seeing is the one where the guillotine is sitting on the steps.

Wed, 06/06/2012 - 10:52 | 2499271 optimator
optimator's picture

I'd settle for a hearing with a few Polygraphs hooked up.

Wed, 06/06/2012 - 11:39 | 2499518 GMadScientist
GMadScientist's picture

That may not prove useful with the criminally insane.


Wed, 06/06/2012 - 10:45 | 2499253 Hobbleknee
Hobbleknee's picture

Since when is a committee a court and when was the last time anyone was sentenced to prison by a committee?

Wed, 06/06/2012 - 18:50 | 2501319 RECISION
RECISION's picture

... the committee for public safety...


Wed, 06/06/2012 - 10:49 | 2499264 Vagabond
Vagabond's picture

Johnson sounds like he's sucked a few too many johnsons.

Wed, 06/06/2012 - 10:50 | 2499269 MrBoompi
MrBoompi's picture

The Senate Banking Committee and the list of those giving testimony are well-paid lackeys of the banking cartel.  Let the Dog & Pony Show begin.

The only sucker who gets in trouble by lying to a bunch of sellouts is an ex-athlete who used PEDs.  The bankers get a free fucking pass.

Wed, 06/06/2012 - 11:25 | 2499447 MrBoompi
MrBoompi's picture


The Senate Banking Committee is there to protect the interests of banks.  The regulators are not the only captured government employees.  Nobody has the guts to say what JP Morgan did was not hedging.  I have no problem with banks making bets, but there is no way taxpayers should be on the hook for losses and I hear only lip service to those concerns.



Wed, 06/06/2012 - 12:23 | 2499276 giovanni_f
giovanni_f's picture

1. We know it's a theatre staging senators masturbate in public

2. They know that we know.

3. They even know that we know that they know that we know.

4. They don't give a shit. That tells us how irreparably fucked the system is.

Wed, 06/06/2012 - 11:04 | 2499319 Ricky Bobby
Ricky Bobby's picture

A parade of lies and disinformation! I cannot bear to listen for one minute. A black hole has opened in the propaganda matrix and it is consuming the BS at an accelerating rate. If one were an optimist they could view this as a positive trend. Unfortunately I see Orwell's dystopia unfolding before me. 

Nothing like those F-117 flybys with a roaring crowd in the background. Cheering their citiy's gladiators as the colossal state manufactures consent.  

Panem et circo Bitchez!

Wed, 06/06/2012 - 11:10 | 2499348 IO_Psychic_TV
IO_Psychic_TV's picture

IO Psychic TV in da house... shining on the liars, the useless regulators, the criminal-minded politicians.

Wed, 06/06/2012 - 11:15 | 2499372 MrBoompi
MrBoompi's picture

Is Corker applying for job with JP Morgan or what? 

Wed, 06/06/2012 - 11:21 | 2499408 I am a Man I am...
I am a Man I am Forty's picture

JP Morgan can lose 80 Billion dollars and everything would still be cool, did anyone hear that bullshit??  They lose 2 billion and had to sell 25 Billion in assets, if you got so much fucking money why did you have to sell 25 billion in assets you fucking liars?!?!

Wed, 06/06/2012 - 11:21 | 2499413 flight77
flight77's picture

What a farce. I can´t bekieve it.

Wed, 06/06/2012 - 11:37 | 2499512 Cupid Stunt
Cupid Stunt's picture

Corzine, Dimon. Will we they ever do the perp walk ?

I guess not.

Wed, 06/06/2012 - 11:38 | 2499517 MrBoompi
MrBoompi's picture

Banks don't have enough money to give all of the money they have promised to give back to depositors.  What's the average leverage of US banks?  17 to 1?  And how much capital is required to "back up" derivatives?  Zero? 

And when you have Senators saying "We don't want a regulator looking over every banker's shoulder" (Which is a strawman arguement) or "Is it true no bank has ever gone bankrupt due prop trading over the past two years?", you know there will be no new banking regulations passed in the near future.



Wed, 06/06/2012 - 12:08 | 2499669 fuu
fuu's picture

Anyone recording this? I want to pull juicy samples from it.

Wed, 06/06/2012 - 12:52 | 2499865 W10321303
W10321303's picture

Senater hearing, what a joke, they will get their checks in the mail from the their BOSSES....  (; 6/6/12)

Quelle Surprise! Treasury Inspector Audit Report Whitewashes OCC Fail on Foreclosure Fraud

Yesterday, various news and financial sites picked up the release last Friday of a report by the Treasury’s Inspector General titled “SAFETY AND SOUNDNESS: OCC’s Supervision of National Bank’s Foreclosure Practices“. The media accounts are workman-like summaries with titles like “Bank oversight office failed to spot foreclosure fraud, Treasury inspector general says.”

Second, this report is an exercise in Potemkin oversight. It enables a deeply pro-bank agency to stay on its present path; it’s meant to persuade the chump public that the Administration is serious about remedying regulatory fiascoes.

To understand why this audit was defective, all you need to do is look at the discussion of methodology, which is on pages 14-15. In the period November 2010 (right after the robosigining scandal broke) to March 2011, the Treasury IG reviewed foreclosure supervisory coverage at three banks: Bank of America, JP Morgan Chase, and Wells Fargo. These were the measures taken:

This is a strictly internal look. There was NO effort, zero, zip, nada, to do any reality testing of the adequacy of the OCC’s work. How do you know how badly deficient the OCC’s efforts were unless you develop an independent basis for what it takes to do an adequate job of overseeing servicers and then looking at what the OCC found pre the robosigning scandal versus what they ought to have found? The IG is certain not to have an informed view of what the legal and operational issues are. Looking only at OCC documents and talking only to OCC management is a garbage in, garbage out process

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