I’ve purposely neglected to discuss the JP Morgan trading loss because we can only speculate as to their true position. But the two billion dollar loss could quickly spiral to many times that.
Supposedly, the position will go further against them if Europe sinks further into the morass. I’ve had a thought, and I’m sure I’m not the first.
Remember how bank stocks were attacked, one by one, in 2008? Remember how all the CEO’s all complained about how “short sellers” were damaging their franchises? Remember how banks failed in the marketplace, one by one?
Are there other non-disclosed positions that could turn large? Are they “laid bare”? Would it be possible to kill JPM at this time? I think the answer might be “yes”.
Of course they will have an unlimited credit line from Uncle Ben, but a tightly focused, highly leveraged “attack” could wreak havoc on JPM and perhaps cast a much wider net. Sure, they’ve lost significant market cap. But perhaps it is only the tip of the iceberg, just like in 2008.If you enjoy the content at iBankCoin, please follow us on Twitter