JPM Gave Risk Management Oversight To Museum Head Who Sat On AIG's Board

"Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses, and when, not if, they suffer losses so large that they would cause the bank to fail, they will be bailed out."

William K Black

This is JP Morgan, America's mightiest and unsinkable 'showcase bank,' run by its toughest and craftiest CEO, that holds the counterparty risk on an almost unimaginable $70 TRILLION in derivatives, an amount sufficient to destroy not only their own balance sheet, but probably the entire world's financial system as well, over a weekend.

And Greece is irresponsible.

Are you fucking kidding me?

Sleep well.

Bloomberg
JPMorgan Gave Risk Oversight to Museum Head Who Sat On AIG Board
By Dawn Kopecki and Max Abelson
May 24, 2012

The three directors who oversee risk at JPMorgan Chase & Co. include a museum head who sat on American International Group Inc.’s governance committee in 2008, the grandson of a billionaire, and the chief executive officer of a company that makes flight controls and work boots.

What the risk committee of the biggest U.S. lender lacks, and what the five next largest competitors have, are directors who worked at a bank or as financial risk managers. The only member with any Wall Street experience, James Crown, hasn’t been employed in the industry for more than 25 years...

Read the rest here.

Office of the Comptroller of the Currency 4th Quarter 2011 Derivatives Report

The Pigman's Motto:

If you make people frightened enough, they will give you anything.

No Justice: SEC Probes Lehman For Three Years, Recommends Nothing

Corruptio optimi pessima.
(The best things when corrupted become the worst.)

Aristotle, Nicomachean Ethics

Not even a wristslap.

Well at least the SEC released its report. The craven curs and hypocrites at the CFTC have been studying the criminal manipulation of the silver market for more than four years, and as of yet have not even had the decency to release their findings, and then proclaim they will do nothing about it.

It is the contempt of vultures. The more you take it, the bolder they become.

But not to worry, you will be able to vote for 'change' again in November.

There will be another financial crisis. And there will be another bailout. And you will take it and do nothing, except perhaps grumble quietly and draw comfort with the thought, 'Thank God, at least we are not socialist like Europe.' Before it is over they may do monstrous things in your name, and you will avert your eyes and say nothing.

"For what does it profit a man, if he shall gain the whole world, but lose his soul?"

There is little downside to white collar crime, and accounting fraud has been effectively decriminalized in the acceptance of Lehman's 'Repo 105.'

Nothing is safe.

Deep Capture the Movie.

Bloomberg
SEC Staff Said to End Lehman Probe Without Seeking Action
By Joshua Gallu
May 24, 2012

U.S. Securities and Exchange Commission investigators have concluded their probe of possible financial fraud at Lehman Brothers Holdings Inc. and determined that they will probably not recommend any enforcement action against the firm or its former executives, according to an excerpt of an internal agency memo.

The agency has been grappling with the case for more than three years amid questions from lawmakers and investors as to whether Lehman misrepresented its financial health before filing the biggest bankruptcy in U.S. history in September 2008.

Under a heading reading “Activity in Last Four Weeks,” the undated document reads, “The staff has concluded its investigation and determined that charges will likely not be recommended.”

SEC officials didn’t dispute the authenticity of the memo or its contents.

Pressure on the agency to punish any wrongdoing related to Lehman’s collapse escalated after Anton Valukas, the court- appointed bankruptcy examiner, found the firm misled investors with “accounting gimmicks” that disguised the firm’s leverage.

Senior officials have been reluctant to formally close the matter even though investigators found a lack of evidence of wrongdoing, according to people with direct knowledge of the matter. The officials have weighed issuing a public report on their findings that would stop short of an enforcement action while describing questionable conduct...

Read the rest here.

Gold Daily and Silver Weekly Charts - Quiet Option Expiration With a Little Gut Check

Precious metal holders were jerked around a little today on the option expiration. I would anticipate another hit tomorrow to test the hands holding in the money calls, which are converted to active futures contracts at the close.

All eyes are on Europe and the western central banks.

Gold needs to break the big downtrend to prove that the decline is over. Until then I would not feel confident enough to say 'all clear.'

It would be a nice 'triple bottom' if we can get it, but it must be confirmed with a breakout.

I 'trimmed my sails' a bit today on the intraday swings. No sense turning down 'free money' which is what the wiseguys have in minds when they try and scare mom and pop out of their positions.

Long term holders would be best served by ignoring the antics.

SP 500 and NDX Futures Daily Charts

Another nothing day, marking time. The traders want to see what happens in Europe, and what Ben and his pals will do in response.