How About JP Morgan's $150,000,000,000.00 in Mortgage Back Bonds?
JPMorgan Unit Has $100 Billion of Risky Bonds
Published: Thursday, 17 May 2012 | 8:31 PM ET
http://www.cnbc.com/id/47469753
By: Sam Jones in London and Tracy Alloway and Tom Braithwaite in New York
The unit at the centre of JPMorgan Chase’s $2 billion trading loss has built up positions totalling more than $100 billion in asset-backed securities and structured products – the complex, risky bonds at the centre of the financial crisis in 2008.
These holdings are in addition to those in credit derivatives which led to the losses and have mired the bank in regulatory investigations and criticism.
has been the biggest buyer of European mortgage-backed bonds and other complex debt securities
The unit made a deliberate move out of safer assets such as US Treasuries in 2009 in an effort to increase returns and diversify investments. The CIO’s “non-vanilla” portfolio is now over $150 billion in size.
“I can’t see how they could unwind these positions because no one can replace them in terms of size. It’s a bit of the same problem they face with the derivatives trade,” said a credit trader at a rival bank. “They pretty much are the market.”
Read More at=> CNBC
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"I place economy among the first and most important virtues, and public debt as the greatest of dangers. To preserve our independence, we must not let our rulers load us with perpetual debt."
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