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Putting It Into Perspective: Bruno Iksil's $100 Billion Position Makes Him The Seventh Largest Bank Holding Company By CDS Exposure

Tyler Durden's picture





 

With the story of Bruno Iksil refusing to be swept under the rug (for now), we had the urge to show just how his position stacks up in comparison to the CDS holdings for all the bank holding companies tracked by the Office of the Currency Comptroller. Recall: "Iksil may have built a position totaling as much as $100 billion in contracts in one index, according to the market participants, who said they based their estimates on the trades and price movements they witnessed as well as their understanding of the size and structure of the markets." We used a log scale index although even in simple linear terms the story is quite straightforward: we are not sure what is worse - that one trader may have amassed a CDS position (with an associated VaR that is in the billions) which is greater than the combined holdings of all except for 6 banks (and is greater than the combined CDS exposure of a Wells Fargo among others), or that the top 5 banks together account for 96.5% of all CDS holdings? One thing we are certain of, is that JPMorgan's $71 trillion in assorted derivatives is all purely for hedging purposes. After all Dick Bove just said so.

Source: OCC

 


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Mon, 04/09/2012 - 16:56 | Link to Comment Seize Mars
Seize Mars's picture

When Blythe said, "no" or "none," she meant, well, a lot.

Mon, 04/09/2012 - 17:04 | Link to Comment spiral_eyes
spiral_eyes's picture

New preview from Nassim Taleb (on this meta-topic, the problem of taking the upside without risking the downside):

http://www.fooledbyrandomness.com/prologue.pdf

Mon, 04/09/2012 - 17:09 | Link to Comment Xibalba
Xibalba's picture

I'm sure the regulators are on it.  

 

 

:?  sarc

 

 

 

 

Mon, 04/09/2012 - 21:38 | Link to Comment LongSoupLine
LongSoupLine's picture

 

 

 

"What the ever loving hell is a "CDS""?!? - The SEC

Mon, 04/09/2012 - 17:11 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Someone needs to let her know that we "are not" constructing a guillotine, or several of them.

Mon, 04/09/2012 - 17:31 | Link to Comment Zero Govt
Zero Govt's picture

...indeedy, we are not amused 

we want the truth, the whole truth and nothing but the full multi-$Trillion Dollar balls-up that JP Morgan is in ...ha

Mon, 04/09/2012 - 17:37 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

@seiZe_m_r_s:  When Blythe said, "no" or "none," she meant, well, a lot.

apparently, she pulls this on everybody!

i think she's hot b/c she's a nympho, a sizeQueen, and a switch-hitter

plus, she has a grrreat little ass!

Mon, 04/09/2012 - 17:58 | Link to Comment francis_sawyer
francis_sawyer's picture

She was a dude... The aforementioned guillotine chopped the dick off (but it grew back)...

Mon, 04/09/2012 - 18:32 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

weren't you here the night she showed up and got gang-banged?

she was a true sport, even as the asians gave her facials

and that grrreat equestian ass, too

if she gets too far into that goody-goody side, she may re-emerge here, just for psychological needs...

what a dreamer!

Mon, 04/09/2012 - 21:26 | Link to Comment stocktivity
stocktivity's picture

Stock up on popcorn. When this thing blows, it will be interesting to watch.

Mon, 04/09/2012 - 16:58 | Link to Comment Lost Wages
Lost Wages's picture

Sounds like JPM needs to invent the Bruno Iksil Mutual Fund so we can all get in on this action.

Mon, 04/09/2012 - 17:17 | Link to Comment Manthong
Manthong's picture

They probably already have an under-the-counter Iskil CDS.

We need Iskil ETF's complete 3X Bull and Bear Iskils.

Then we need an Iskil Volatility synthetic.

Hell, since everything's all Vegas anymore make it just like craps with a 10X Iskil.

Come on now, somebody step up to the plate! 

Mon, 04/09/2012 - 16:59 | Link to Comment Dapper Dan
Dapper Dan's picture

JP Morgan is "winning"

They have the longest pole thingy.

Mon, 04/09/2012 - 17:08 | Link to Comment HD
HD's picture

"They have the longest pole thingy"

 [Insert Santorum joke here]

Mon, 04/09/2012 - 16:59 | Link to Comment Grin Bagel
Grin Bagel's picture

please define who this individual is in the world you and I inhabit, and what it means beyond the good comments of your overview.

Mon, 04/09/2012 - 17:21 | Link to Comment 12ToothAssassin
12ToothAssassin's picture

and his residential address

Mon, 04/09/2012 - 17:02 | Link to Comment francis_sawyer
francis_sawyer's picture

Where's my invite to his Liverpool nightclub "champagne room"?

Mon, 04/09/2012 - 22:54 | Link to Comment GMadScientist
GMadScientist's picture

Evidence impounding.

Mon, 04/09/2012 - 17:01 | Link to Comment Cdad
Cdad's picture

Seriously, just sell the derivative  portfolio, and then with the cash proceeds, buy lots of plywood...and nail the front door of EVERY JP Morgue house shut.  And then the rest of us can finally get on with some real economic recovery. 

 

Mon, 04/09/2012 - 17:20 | Link to Comment Koffieshop
Koffieshop's picture

JPM is part of the inner core of the circle jerk. The Fed will never allow them to fail. JPM will stay in business until the hyperinflation event.

Mon, 04/09/2012 - 18:59 | Link to Comment LawsofPhysics
LawsofPhysics's picture

"JPM will stay in business until the hyperinflation event"

Precisely.  Remember, JPM is the Fed and has a play on all sides of this.  They even "deliver" foodstamps.  Be a shame if that entitlement suddenly got turned off now, wouldn't it?

Mon, 04/09/2012 - 20:28 | Link to Comment Vampyroteuthis ...
Vampyroteuthis infernalis's picture

JPM even delivers unemployment benefits in Texas. God bless the Man. (More like fuck him!)

Mon, 04/09/2012 - 17:02 | Link to Comment Forgiven
Forgiven's picture

Bruno Iksil with such a high level of CDS exposure?!  Sounds like the setup for a rogue trader scandal at House of Morgan....

Mon, 04/09/2012 - 17:04 | Link to Comment Lost Wages
Lost Wages's picture

He's got the name of a scapegoat.

Mon, 04/09/2012 - 18:00 | Link to Comment francis_sawyer
francis_sawyer's picture

yeah but he makes Wells Fargo look like pikers...

Mon, 04/09/2012 - 19:05 | Link to Comment brettd
brettd's picture

Takes the pressure off Corzine.

Mon, 04/09/2012 - 17:03 | Link to Comment HD
HD's picture

Bove might as well put on a cheerleader outfit and grab some pom-poms and chant "We've got spirit yes we do, buy bank stocks and they'll screw you! Gooooooooooooooooooooo BANKS!"

Mon, 04/09/2012 - 17:03 | Link to Comment knukles
knukles's picture

Dick Bove is a fucking idiot.

The propaganda machine is scraping the bottom of the barrel.
Seige of Staligrad, anyone?

Mon, 04/09/2012 - 17:34 | Link to Comment Zero Govt
Zero Govt's picture

we're not scraping the bottom, Bove is always first crone up

...the bottom is when they wheel out Jim Cramer

Mon, 04/09/2012 - 19:02 | Link to Comment LarryDavis
LarryDavis's picture

Wapner, Bartiromo, Kudlow and Liesman have as good a command of the financial world as does a dog's dried ejaculate.

Mon, 04/09/2012 - 19:48 | Link to Comment HD
HD's picture

Disgustingly true...

Mon, 04/09/2012 - 21:17 | Link to Comment stocktivity
stocktivity's picture

It's 4 o'clock on Wall St. Do you know where your doggy is?

Mon, 04/09/2012 - 17:04 | Link to Comment max2205
max2205's picture

Click. Boom

Mon, 04/09/2012 - 17:06 | Link to Comment PontifexMaximus
PontifexMaximus's picture

Don't you think that there are more Bruno's around with GS, Citi, BoA, DB, CS, UBS et al. They all want to be masters of the universe and make the world going round, or better, polish up their pa. Did markets take that into consideration?

Mon, 04/09/2012 - 17:08 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Jubilee bitchez.  Tyler, could we see a chart with the very same players and their PM holdings?  Pretty please.

 

Basically the message I get from this chart is "JPM has the most nukes".  Whether or not they use them is another issue altogether, but predictable if history is any guide.

Mon, 04/09/2012 - 17:11 | Link to Comment francis_sawyer
francis_sawyer's picture

PM holdings?

Here are the only PM's these ones are 'holding'...

http://www.hamovhotov.com/picturegallery/?id=155&level=picture

Mon, 04/09/2012 - 17:14 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Not true.  JPM has PMs, many of them have been recently "re-hypothicated" from MF-Global.  It was JP Morgan after all who said, "Gold is Money, everything else is credit".

Sometimes the answer hides in plain sight.

Mon, 04/09/2012 - 17:23 | Link to Comment francis_sawyer
francis_sawyer's picture

I'm not talking about the private vaults of it's PREFERRED fellows... I'm talking about what it admits to the public...

But we're talking semantics here...

Mon, 04/09/2012 - 17:06 | Link to Comment francis_sawyer
francis_sawyer's picture

 "One thing we are certain of, is that JPMorgan's $71 trillion in assorted derivatives is all purely for hedging purposes. After all Dick Bove just said so..."

I'm pretty sure that grandpa Dick & grandpa Bernank spend countless hours 'hedging' each others chin fur... Krugman & Gartman are their understudies on 'certain' holidays... 

Mon, 04/09/2012 - 17:08 | Link to Comment michigan independant
michigan independant's picture

So is this another fool and his money part story of this decade? Who would ever pay paper for paper is beyond me. 

Mon, 04/09/2012 - 18:11 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

in paperPonZee as it is now broadcast, at least 6Bil are completely hypno, imo

ergo, it is the promise of future paper which motivates them

noShitoli, m_i_boyardee

others play for future "assets" now backed by paper in the IOUskie "markets" [but possibly worth "sovereign" wealth at some future point in this is fiatsco?  how do you "mark" yer markerZ?]

and, since they all "agree"?: canoes are sinking faster than bonds...  in spite of how insane it is to buy PMs, the banksters will buy all you'd ever want to sell, all day, everyday...

so, just get ready to sell & go away, next month...

what could possibly go wrong? 

btw, once your conoe sinks, do you still care?  me neither

Mon, 04/09/2012 - 17:11 | Link to Comment DormRoom
DormRoom's picture

So ONE guy can gamble with 100B while mom & pop small businesses can't get loans.

 

America is fundamentally broken when Industrial icons like Howard Hughes are replaced by financial boy wunderkinds.

Mon, 04/09/2012 - 17:36 | Link to Comment Catullus
Catullus's picture

What's broken is that because one guy can gamble with $100bn, mom & pop have to take out loans to run the business.  Whether they get them or not is a different story.

Mon, 04/09/2012 - 18:44 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

at least he wasn't drunk from golf like that brit who blew out the oil market a coupla years ago...   jeeeez! that was funny!

i usta play extremeToxicGolf and once came home, somehow, from aforemntioned idiocy, put a pizza in the oven @ 450F and went to bed

the next morning i had a little, dark, ceramic disc

if anybody has any money, we could patent the process and start a company to mummify poeple after the goobermint votes them out

or radiation victims~..~energy-saving, btw

if they had lottsa tats or ?, we could display them...

plus, think of the soap!

Mon, 04/09/2012 - 23:03 | Link to Comment GMadScientist
GMadScientist's picture

No. One guy can buy contracts that amount to a notional value at risk (i.e. an imaginary valuation, at best) of $100B.

This pissant is still spit in the ocean (1/568th of the JP Morgan tower of derivative shit) until he gets past counter-party risk and actually collects a dime.

And Hughes ended up nuts pissing in bottles so he didn't have to leave the house; choose wisely.

 

Mon, 04/09/2012 - 17:22 | Link to Comment mendigo
mendigo's picture

Thar she blows!
Very cool: set up one guy to take the fall for all of Europe.
Pure genious but I fear Tyler has spoiled the surprise.

Mon, 04/09/2012 - 18:53 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

leave it to theMorgue to supply the dude to end the EU? 

ok...

Mon, 04/09/2012 - 17:31 | Link to Comment tekhneek
tekhneek's picture

I have a hard time believing this is just one guy and not a handle for the big 6 to play see-saw on the market with and make $ off the top based on the swings.

I mean: It might look like 1 persons name, but it's probably a consortium under this guise.

Mon, 04/09/2012 - 17:37 | Link to Comment Hansel
Hansel's picture

Also, I don't doubt JPM has a huge CDS prop position, but is this really the new standard of evidence?

... may have built... according to the market participants... who based their estimates on the trades they witnessed... as well as their understanding...

Mon, 04/09/2012 - 20:16 | Link to Comment AccreditedEYE
AccreditedEYE's picture

Hansel, you've been keeping score on these pages longer than I have... I'm not really sure that any institution that has TBTF status deserves ANY benefit of the doubt...  

Mon, 04/09/2012 - 17:30 | Link to Comment Catullus
Catullus's picture

At least the position is less than the annual GDP of Morocco.

That's the power of positive thinking!

Mon, 04/09/2012 - 17:32 | Link to Comment SolidSnake961
SolidSnake961's picture

dont worry guys, it is a small position "net of hedges" haha

Mon, 04/09/2012 - 17:36 | Link to Comment Obnoxio
Obnoxio's picture

This shows just how much of a rancid casino capital markets have become. A sickening show of JP Morgan's implied Federal reserve backing.

Mon, 04/09/2012 - 18:07 | Link to Comment LawsofPhysics
LawsofPhysics's picture

JPM is the fucking Fed.  

Mon, 04/09/2012 - 17:43 | Link to Comment The Axe
The Axe's picture

When you have 71 trillion in paper...you have no regulation...you are the man....no one well ever say shit...ever

Mon, 04/09/2012 - 23:04 | Link to Comment GMadScientist
GMadScientist's picture

Hahahaha.

Punk.

Mon, 04/09/2012 - 17:46 | Link to Comment Downtoolong
Downtoolong's picture

No doubt this qualifies him for a personal exemption from position limits by the CFTC and a personal exemption from the Fed for commercial bank risk management practices. They're probably working on the letters right now.  Next thing you  know Fannie Mae will be giving him a $10 billion mortgage loan commitment at the Fed overnight funds rate so he can buy Buckingham palace and convert it to his private residence. 

Mon, 04/09/2012 - 17:47 | Link to Comment icanhasbailout
icanhasbailout's picture

Why do his competitors let him live?

Mon, 04/09/2012 - 18:02 | Link to Comment MiguelitoRaton
MiguelitoRaton's picture

If Bruno is right, JPM scores big. If Bruno is wrong, JPM gets bailed out. If I were Bruno, I would take that bet too.

Mon, 04/09/2012 - 18:08 | Link to Comment rawsienna
rawsienna's picture

Why does any bank have a need to sell protection as a "hedge".  Are they not long enough credit risk?  Do they need to get longer? Very fishy.

Mon, 04/09/2012 - 18:14 | Link to Comment carbonmutant
carbonmutant's picture

CNBC is like the WWE. It's Financial entertainment TV.

"Our analysts are trained professionals. You should never try to emulate what they do in your own portfolio."

Mon, 04/09/2012 - 18:13 | Link to Comment q99x2
q99x2's picture

What is wealth? When will Bruno have the time to enjoy a thorough analysis Joyce's Dubliners or Nietzsche's Zarathustra?

Ok. Maybe racing fighter jets or a trip to outer space has that beat.

Anyhow Bruno ain't going to get nothing but a freakin headache trying to collect on all those CDSes.

 

Mon, 04/09/2012 - 18:31 | Link to Comment Sutton
Sutton's picture

Bruno Iksil, meet Joe Cassano.

 

Mon, 04/09/2012 - 23:04 | Link to Comment GMadScientist
GMadScientist's picture

Joe, Bruno, meet Mr. Hollowpoint.

 

Mon, 04/09/2012 - 18:40 | Link to Comment Racer
Racer's picture

the S will eventually HTF

as it always does...

dot com,

bubble house

tulips

nasdaq

and now they are buying apples or any..things in manic mode as if they were the best thing since... tulips or houses or   .......dots.....com

 

 

 

Mon, 04/09/2012 - 18:40 | Link to Comment SillySalesmanQu...
SillySalesmanQuestion's picture

Jamie's Porking Masters

Mon, 04/09/2012 - 23:05 | Link to Comment GMadScientist
GMadScientist's picture

Jerkoff's Pumping Manure

 

Mon, 04/09/2012 - 18:55 | Link to Comment EmileLargo
EmileLargo's picture

We need more info. What side of the bet has he taken? Or are these the total gross position "netting out" to a much smaller amount in theory with JP taking a cut in the middle (we've seen before how that movie ends)? If he has underwritten CDSs for that notional, it may be time to short JP stock. The next five years will test the CDS market to DESTRUCTION. 

JPM may not survive the next five without an explicit bail-out if they have a $5.6 Trillion CDS exposure. Oh boy................this is going to get very interesting

Mon, 04/09/2012 - 18:57 | Link to Comment Coldfire
Coldfire's picture

I feel a great disturbance in the Farce.

Mon, 04/09/2012 - 18:59 | Link to Comment oogs66
oogs66's picture

Bove is an idiot but Bruno probably has a small fraction of the alleged risk

Mon, 04/09/2012 - 20:07 | Link to Comment buzzsaw99
buzzsaw99's picture

As long as no counterparties cough, AIG, cough, default and allow cough, the squid, cough, to shake down the taxpayers then...

 

JPM execs will get bonuses no matter what happens, that's my prediction.

Mon, 04/09/2012 - 20:45 | Link to Comment mark mchugh
mark mchugh's picture

"And I, Bruno, will drive 1000 feet into a block of cement....on my head even!"

http://www.youtube.com/watch?v=woH0Nhbc-fc

 

Mon, 04/09/2012 - 21:49 | Link to Comment Bartanist
Bartanist's picture

To state the obvious: NONE OF THE F'N INTERNATIONAL CRIMINAL BRANK COULD EVER CLAIM A PROFIT IF THEY DID NOT ALSO CLAIM THAT THEIR RISK DID NOT EXIST ... due to hedging.

The global financial system is so far past rationality that no one dare acknowledge the emperor is bare naked and has a massive pustulent wart on his ass.

Mon, 04/09/2012 - 23:30 | Link to Comment fcamargoe
fcamargoe's picture

The greatest trick the devil ever pulled was convincing the world he didnt exist.

Tue, 04/10/2012 - 00:56 | Link to Comment Peter K
Peter K's picture

The thing that troubles me most is the fact that he's French. I hope he has at least one Rosbeef assistant:)

Mon, 05/14/2012 - 02:50 | Link to Comment putaipan
putaipan's picture

and to think.... this was the post that started it all. popcorn indeed.

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