The Wall Street Journal reports, a massive trading bet backfired on J.P. Morgan, leaving the bank with at least $2 billion in trading losses and its chief executive, James Dimon, with a rare set back, following a long run as the “King of Wall Street.” The losses stemmed from wagers gone wrong, in the bank’s Chief Investment Office, which manages risk for the company. Large positions taken in that office by a trader nicknamed “the London whale”, had roiled a sector of the debt markets. The bank, betting on a continued economic recovery, with a complex web of trades tied to the values of corporate bonds, was hit hard, when prices moved against it, starting last month, causing losses in many of its derivatives positions. The losses occurred while J.P. Morgan tried to scale back that trade. The bank’s strategy was “flawed, complex, poorly reviewed, poorly executed and poorly monitored,” Mr. Dimon said Thursday in a hastily arranged conference call with analysts and investors after the stock-market close.
According to a Bloomberg investor poll, Facebook, seeking as much as $96 billion in its IPO next week, is overvalued at that price. Underscoring concerns that growth may taper for the world’s biggest social network, 79 percent of respondents in the Bloomberg Global Poll of 1,253 investors, analysts and traders, said Facebook doesn’t deserve a valuation so high. At the high end of a projected range of $28 to $35 a share, Facebook would be valued at 99 times its earnings, a higher multiple than 99 percent of companies in the Standard & Poor’s 500 Index. Facebook, seeks a valuation at 24 times revenue, compared with 5 times for Google. The IPO has so far generated lower-than-expected demand from institutional investors who are concerned about growth prospects.
Reuters reports, Banks are quietly readying themselves to start trading a new Greek currency. Some banks never erased the drachma from their systems, after Greece adopted the euro more than a decade ago and would be ready at the flick of a switch, if its debt problems forced it to bring back national banknotes and coins. Planning behind the scenes has been underway since Europe’s debt crisis erupted in Greece in 2009, said U.S.-based Hartmut Grossman of ICS Risk Advisors, who works with Wall Street banks. The EU says it wants Greece to stay in the common currency, and opinion polls show Greeks want to keep it. But they also voted last Sunday for parties, opposed to a bailout with the EU and IMF, throwing Greece’s future in the bloc back into doubt.
The Wall Street Journal reports, a massive trading bet backfired on J.P. Morgan, leaving the bank with at least $2 billion in trading losses and its chief executive, James Dimon, with a rare set back, following a long run as the “King of Wall Street.” The losses stemmed from wagers gone wrong, in the bank’s Chief Investment Office, which manages risk for the company. Large positions taken in that office by a trader nicknamed “the London whale”, had roiled a sector of the debt markets. The bank, betting on a continued economic recovery, with a complex web of trades tied to the values of corporate bonds, was hit hard, when prices moved against it, starting last month, causing losses in many of its derivatives positions. The losses occurred while J.P. Morgan tried to scale back that trade. The bank’s strategy was “flawed, complex, poorly reviewed, poorly executed and poorly monitored,” Mr. Dimon said Thursday in a hastily arranged conference call with analysts and investors after the stock-market close.
According to a Bloomberg investor poll, Facebook, seeking as much as $96 billion in its IPO next week, is overvalued at that price. Underscoring concerns that growth may taper for the world’s biggest social network, 79 percent of respondents in the Bloomberg Global Poll of 1,253 investors, analysts and traders, said Facebook doesn’t deserve a valuation so high. At the high end of a projected range of $28 to $35 a share, Facebook would be valued at 99 times its earnings, a higher multiple than 99 percent of companies in the Standard & Poor’s 500 Index. Facebook, seeks a valuation at 24 times revenue, compared with 5 times for Google. The IPO has so far generated lower-than-expected demand from institutional investors who are concerned about growth prospects.
Reuters reports, Banks are quietly readying themselves to start trading a new Greek currency. Some banks never erased the drachma from their systems, after Greece adopted the euro more than a decade ago and would be ready at the flick of a switch, if its debt problems forced it to bring back national banknotes and coins. Planning behind the scenes has been underway since Europe’s debt crisis erupted in Greece in 2009, said U.S.-based Hartmut Grossman of ICS Risk Advisors, who works with Wall Street banks. The EU says it wants Greece to stay in the common currency, and opinion polls show Greeks want to keep it. But they also voted last Sunday for parties, opposed to a bailout with the EU and IMF, throwing Greece’s future in the bloc back into doubt.