archive-com.com » COM » 9 » 911OMISSIONREPORT.COM

Total: 693

Choose link from "Titles, links and description words view":

Or switch to "Titles and links view".
  • Buffett says derivative values can be misleading
    company s nearly 7 5 billion investment losses last year Buffett said in the letter released Saturday morning he initiated all of Berkshire s 251 different derivative contracts because he believes they were mispriced in Berkshire s favor Berkshire has received 8 1 billion in payments for derivatives which can be invested until the contracts expire years from now But Berkshire has to estimate the value of its derivatives every

    Original URL path: http://www.911omissionreport.com/buffett_derivative.html (2016-02-14)
    Open archived version from archive

  • Inquiry Asks Why A.I.G. Paid Banks
    although the subpoena was served under the Martin Act a state law that gives the attorney general broad prosecutorial powers A spokesman for A I G said the company had no comment on the new inquiries The banks and investment firms that ended up with A I G s bailout money last fall were in many cases counterparties to derivatives contracts it had sold known as credit default swaps which guaranteed the value of assets in their investment portfolios Had A I G not been bailed out and simply allowed to go bankrupt they would have suffered investment losses running into the billions of dollars A I G released the names of its major counterparties this month at the urging of the Federal Reserve Board of Governors They included Wall Street firms like Goldman Sachs JPMorgan Chase and Merrill Lynch that have successfully resisted efforts to regulate credit derivatives in the past on the argument that such contracts were valuable risk management tools safe in the hands of the experts In several hearings this month members of Congress said they believed the derivatives had often been used to speculate not to manage risk They have expressed outrage that A I G s trading partners got 100 cents on the dollar for their money losing trades when ordinary Americans paying for the bailout have suffered big losses in their 401 k accounts and other investments Some have also been dismayed to learn that taxpayer money had ended up bailing out foreign banks Some of the biggest beneficiaries of the bailout of A I G were banks in Europe including Société Générale of France and Deutsche Bank of Germany each of which received nearly 12 billion Barclays of Britain which received 8 5 billion and UBS of Switzerland which received 5 billion

    Original URL path: http://www.911omissionreport.com/aig_paid_banks.html (2016-02-14)
    Open archived version from archive

  • SEC mulled national security status for AIG details
    engineered rescue in November 2008 from being made public More than a year later the Fed s bailout of AIG remains controversial because it funneled nearly 70 billion to 16 big U S and European banks that had bought credit default swaps from AIG Banks like Goldman Sachs Group Inc Societe Generale and Deutsche Bank had bought those insurance like derivatives to guard against defaults on hundreds of securities backed by subprime mortgages BACKDOOR BAILOUT Lawmakers on Capitol Hill have labeled the AIG bailout in which the New York Fed created a special entity to purchase those securities from the banks at essentially their face value a backdoor bailout for the 16 financial institutions The new batch of emails along with others that have become public in recent weeks reveal that some at the New York Fed had gone to great lengths to keep the terms of the bailout private and the SEC may have played a role in contributing to some of the secrecy surrounding the AIG rescue package The New York Fed was orchestrating what can only be characterized as an extreme effort to ensure that details of the counterparty deal stayed secret Rep Darrell Issa from California the ranking Republican on the House Oversight Committee said through a spokesman More and more it looks as if they would ve kept the details of the deal secret indefinitely it they could have In March some of the secrecy surrounding the AIG bailout began to fall away when the insurer under pressure from Congress and the SEC agreed to publicly name the 16 banks that got money in the rescue package and how much each received But AIG largely at the prodding of the New York Fed refused to make public all of the information in the controversial document officially called Schedule A List of Derivative Transactions according to the emails turned over by the central bank to Capitol Hill AIG continued to seek confidential treatment from the SEC for the redacted portions of the five page filing Last May the SEC did grant AIG s request for confidential treatment for the remaining redacted portions of the Schedule A filing The redacted parts include the CUSIP or trading ID number for each security on which AIG wrote a CDS contract as well as the face value of each individual security that AIG had insured against default The SEC agreed to let AIG keep that information confidential until November 2018 or the 10th anniversary of the bailout Critics contend that without the redacted information it is difficult to determine which of the 16 banks had held the worst performing securities and which banks originated the worst of the troubled securities GEITHNER UNDER MICROSCOPE The New York Fed has argued the information needs to remain confidential to enable BlackRock Inc which manages the portfolio of securities bought from the banks to compete with hedge funds on an even playing field U S Treasury Secretary Timothy Geithner who has drawn fire for

    Original URL path: http://www.911omissionreport.com/aig_security.html (2016-02-14)
    Open archived version from archive

  • How JPMorgan Made Jefferson County Toxic
    over charges that its municipal derivatives unit participated in an industry wide scheme to fix prices and overcharge local governments on investment contracts The bank blamed former employees and said it has increased oversight of its public finance business In a motion to dismiss a lawsuit by Jefferson County JPMorgan said the county was inappropriately attempting to lay blame for the debt crisis at the bank s feet The simple fact is that the county took on too much debt and vastly underestimated the cost of building out its sewer system lawyers for JPMorgan argued These problems were only exacerbated by the county s poor management of its sewer system and the current credit crisis Dodd Frank Law JPMorgan spokesman Justin Perras declined to comment for this story and said Chief Executive Officer Jamie Dimon who joined JPMorgan after the Jefferson County deals were done wasn t available for an interview William B Harrison Jr the bank s CEO at the time it sold the contracts didn t return phone calls seeking comment The county s collapse has loomed over the municipal bond market for more than three years and inspired provisions in the Dodd Frank law seeking to protect localities from complex financial trades involving derivatives Officials are asking JPMorgan and other creditors to forgive about 1 billion of the bonds or may decide as soon as today to file for bankruptcy protection to escape the debts Money Saving Plan In Jefferson County JPMorgan pitched a money saving plan that converted almost all the county s 3 billion of sewer system debt into floating rate securities coupled with derivatives The deals comprised the largest transactions in municipal swaps and auction rate bonds a form of floating rate borrowing in the bank s history according to the SEC Like homeowners who turned to exotic mortgages officials refinanced 93 percent of the sewer bonds into securities with adjustable interest rates They bought interest rate swaps in which two parties make periodic payments based on an underlying measure of borrowing costs The contracts were supposed to offset the floating rates the county paid and give it a fixed rate that was lower than on traditional bonds The county paid JPMorgan Bear Stearns Cos Bank of America Corp and Lehman Brothers Holdings Inc 120 million in fees for swap trades Those fees were as much as six times the prevailing rate according to a report by former county financial adviser Porter White Co of Birmingham Alabama The money saving strategy backfired JPMorgan s financings unraveled in early 2008 as the subprime mortgage market meltdown sent ripples through Wall Street undermining the credit ratings of the companies that insured Jefferson County s bonds Interest Costs Soared The county s interest costs soared as investors dumped the bonds After banks demanded early payoffs the county defaulted The swaps exposed the county to hundreds of millions in fees to refinance JPMorgan s Dimon has moved to put the municipal crisis behind him In 2008 the bank

    Original URL path: http://www.911omissionreport.com/jpm_toxic.html (2016-02-14)
    Open archived version from archive

  • J.P. Morgan’s bet against J.P. Morgan
    advantage of an interesting trade the bank hedges the spread on its own debt When investors bid up the yield an indicator that they think the bank won t pay J P Morgan makes money Read full story on J P Morgan earnings Hey it doesn t have to make sense it s Wall Street The end result was slightly better than expected but lackluster profit of 4 26 billion for the nation s second biggest bank by assets The bank reported 1 9 billion in revenue from the bets against itself the net income from the move wasn t immediately available But analysts suggest the move goosed earnings by as much as a nickel per share At minimum the hedge added a penny or two a share to per share earnings and thus helped the bank come closer to the Street s expectations Of course J P Morgan isn t alone in this Morgan Stanley offset losses during the financial crisis and beyond by betting against its own debt Today s bank earnings must make even the most devoted investor long for the good old days of quarterly results Bank earnings of yesteryear were simple everyone made a profit

    Original URL path: http://www.911omissionreport.com/jp_morgan_bet.html (2016-02-14)
    Open archived version from archive

  • JPMorgan fined for wash trades in oil, gasoline
    losses for the firm Excessive speculation and energy price manipulation are also hot political topics during this U S election year The U S Commodity Futures Trading Commission CFTC is bringing in tighter position limits to try and curb the impact of individual firms on oil and other commodity prices On 10 separate occasions between January 1 2011 and June 30 2011 in an effort to manage position limits traders employed by JPM executed block trades between separate legal entities with the same beneficial owner in WTI or Gasoline the notice said referring to West Texas Intermediate WTI the main U S crude oil futures contract The NYMEX Business Conduct Committee Panel also found that in each of these 10 instances the trader was the sole decision maker for both the buy and sell side of the trade In the first six months of 2011 U S crude oil prices rallied from around 91 a barrel to a post 2008 peak of 114 83 a barrel before falling back to around 95 a barrel On Friday U S crude oil was trading around 83 a barrel As part of the settlement JPMorgan neither admitted nor denied the rule violations the notice said A JPMorgan spokeswoman declined further comment on the settlement In a further settlement Emelumadu one of the JPMorgan traders also neither admitted or denied she had violated any rules The disciplinary notice said the NYMEX Business Conduct Committee had found Emelumadu had executed wash trades in U S crude oil futures on eight separate occasions in the first six months of 2011 NERDS NO 1 Reuters was not immediately able to reach Nigerian born Emelumadu for comment on the disciplinary notice but a JPMorgan spokeswoman said she was still employed by the firm We re confident that Ebele

    Original URL path: http://www.911omissionreport.com/jpmorgan_wash_trades.html (2016-02-14)
    Open archived version from archive

  • JPMorgan Trader Iksil Fuels Prop-Trading Debate With Bets
    of the index which take concentrated risks on the member companies This year Iksil has been betting on an index of 121 companies that all had investment grade ratings when the benchmark was created in September 2007 the market participants said Trading in that index surged 61 percent the past three months according to data from Depository Trust Clearing Corp The net amount of wagers on the index which is tied to the creditworthiness of companies such as Wal Mart Stores Inc and now junk rated bond insurer MBIA Insurance Corp soared to almost 145 billion at the end of March from 90 billion three months earlier according to DTCC which runs a central registry for credit default swaps and reports weekly aggregate volumes Iksil s trades have been so large that they re widening gaps between the relative value of the indexes and the average price of contracts tied to companies in those indexes according to the market participants That has frustrated some hedge funds that had bet the gaps would close the people said First Quarter Iksil has been selling default protection on the index using swaps that expire in December 2017 meaning he would cover the counterparty s losses if a company in the index fails the market participants said The price of the index falls as more insurance is sold against it The index declined 38 basis points in the first three months of 2012 the biggest quarterly drop since 2009 A basis point is 0 01 percentage point The positions by the bank s calculations amount to tens of billions of dollars and were built with the knowledge of Iksil s superiors a person familiar with the firm s view said 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 Buying Protection The trade on the index known as the Markit CDX North America Investment Grade Series 9 IBOXUG09 probably isn t a one way bet the people said Iksil may be offsetting the trade by buying protection on the same index with contracts that expire about eight months from now the people said That strategy would pay JPMorgan the difference between the long dated contracts and the short dated ones about 47 basis points as of April 6 and the trade would gain when the gap narrows The hedge would end in December unless another trade is made to replace it Someone in that position at JPMorgan would typically not be doing pure speculation but would be involved in strategic risk management for the firm Darrell Duffie a professor at Stanford University s graduate school of business said in a telephone interview JPMorgan profited from a similar strategy as the credit crisis erupted in 2008 by buying protection on short dated contracts linked to

    Original URL path: http://www.911omissionreport.com/jpmorgan_iksil.html (2016-02-14)
    Open archived version from archive

  • Tony Blair 'visited Libya to lobby for JP Morgan'
    visits to Tripoli twice in the lead up to the release of the alleged Lockerbie bomber Abdelbaset Ali Megrahi in 2008 and 2009 and once last year On the first two occasions he was flown to the country on planes arranged by Col Gaddafi A senior diplomat told The Daily Telegraph last night that the British embassy in Tripoli had arranged transport for Mr Blair and his entourage in Tripoli and ensured that representatives were there to greet him and see him off at the airport Mr Blair stayed overnight at the ambassador s official residence in Tripoli and was accompanied by several British police officers for protection The documents show that among the people he was due to meet in 2009 was Mohammed Layas head of the LIA A spokesman for Mr Blair said that the visits had largely been to discuss Africa and categorically denied that he had lobbied Said al Islam on behalf of JP Morgan The spokesman said last night As we have made clear many times before Tony Blair has never had any role either formal or informal paid or unpaid with the Libyan Investment Authority or the Government of Libya and he does not and has never had any commercial relationship with any Libyan company or entity Mr Blair began work in January 2008 as a 2million a yearn adviser to JP Morgan Last month American officials told the New York Post newspaper that the bank managed more than half a billion US dollars on behalf of the LIA The executive said that he did not see Mr Blair at the LIA headquarters in the modern Tower of the Revolution overlooking the seafront He said officials like himself were given their instructions by two senior Saif aides including Mohammed Ismail a Libyan with British

    Original URL path: http://www.911omissionreport.com/jp_morgan_blair.html (2016-02-14)
    Open archived version from archive



  •