J.P. Morgan Cuts Derivatives Exposure

Editor’s Note: Today we have a third article from Nathan O. – who is the brain behind our newly launched service, Global Trend Capture.  Over the past several years, Nathan has been perfecting his trend following system and generating some very attractive returns.

Morgan Stanley plans to cut 1,600 jobs in its investment banking unit, roughly 6% of staff in that unit, with employees being informed about job losses beginning this week, a person familiar with the matter said on Wednesday. The cuts will affect traders, salespeople and bankers in Morgan Stanley’s institutional securities business as well as support staff, the source said. This round of job cuts comes in addition to a 6% reduction in the investment bank workforce in 2012, said the source, who was not authorized to speak publicly about the matter.

Everyone I know is for a “tough” derivatives regulation title in the financial reform bill, but there’s relatively little clarity over what that means. This is particularly confusing because there are two distinct elements of this which sound similar. One has to do with whether standardized derivatives ought to be forced onto exchanges (the way stocks are generally trades on exchanges, rather than sold party-to-party) and the other is whether there ought to be a central clearinghouse that financially intermediates derivatives deals.

There is much debate whether when it comes to the total notional size of outstanding derivatives, it is the gross notional that matters (roughly $600 trillion), or the amount which takes out biletaral netting and other offsetting positions (much lower). We explained previously how gross is irrelevant... until it is, i.e.

Graham Summers submits: We’ve been over the numerous BS excuses that US Dollar destroyer extraordinaire Ben Bernanke has made for QE enough times that today I’d rather simply focus on the REAL reason he continues to funnel TRILLIONS of Dollars into the Wall Street Banks.

General Motors stock gyrated between losses and gains Monday as it started its first full week of trading as a reborn company. Analysts said the reason is a combination of hedge funds taking profits and other investors jumping in as the price dips, and they expect volatility to last for several more days. Stock in GM dropped as much as 45 cents to $33.81 as trading opened, but it rebounded to a gain, then continued to move in and out of positive territory.