JP Morgan - We Gambled and You Lost

[LPH]

The bank motto for the past couple of years has been: PARTY ON!

Meanwhile the rest of us have entered into our own austerity rules. We've cut back on eating out. We've cut back on the use of credit cards. We've been paying off debt as quickly as possible. We've stopped buying extras. Millions have stopped buying anything but food and paying rent.

The government motto for the past couple of years has been: BANKS ARE TOO BIG TO FAIL

Meanwhile the rest of us have continued to vote for politicians only listening to lobbyists and ignoring their constituents. We've bought into their rhetoric that side-issues, bedroom issues, and non-relevant issues are more important than our economy's health. We keep voting these corporatists into office. We keep voting against our own interests.

Yes - banks and our government have continued to gamble with our money.

What does the CEO of JP Morgan now say during a Thursday conference call?

"Oops. We just lost $2-billion in six weeks."

Oops? Oops - as in it will not happen again? Nope. Just oops. We'll try. We won't change our party ways but oops.

 

[tuxreporter]

The worst part is Forbes suggesting the stock market is now headed for uncertainty.

 

[Robert Heiny]

Gambling is too harsh a word to call risk management. Yes, both involve calculating the odds that something will occur and the cost if it doesn't. Life continues without interruptions to require these calculations, at least by using estimates, hopefully based on facts, not opinions. Yes?

 

[LPH]

Gambling is too harsh a word to call risk management. Yes, both involve calculating the odds that something will occur and the cost if it doesn't. Life continues without interruptions to require these calculations, at least by using estimates, hopefully based on facts, not opinions. Yes?

Gambling is absolutely the correct word. Gambling assumes that the risk taker has insufficient information regarding the risk. It is a toss of a coin, a game of poker, or the spin of a wheel. The outcome is unknown because there are too many factors. Thus - the use of estimates is nothing more than gambling.

Hedge funds or risk management - are just code words for the phrase: we are getting paid to gamble with your money.