http://news.yahoo.com/surprise-2-billion...13329.html
Experts and industry officials were skeptical that the trading was designed to protect against JPMorgan's own losses, as Dimon contended in a surprise conference call with stock analysts and reporters late Thursday.
The bank appeared to have been betting for its own benefit, a practice known as "proprietary trading," said Rossi and other former bank executives.
Dimon said the type of trading that led to the $2 billion loss would not be banned by the so-called Volcker rule, which is still being written and is expected to ban certain types of trading by banks with their own money.
The Federal Reserve said last month that it would begin enforcing that rule in July 2014. Bank executives, including Dimon, have argued for weaker rules and broader exemptions.
JPMorgan has been a strong critic of provisions that would have made this loss less likely, said Michael Greenberger, former enforcement director of the Commodity Futures Trading Commission, which regulates some derivatives.
"These instruments are not regularly and efficiently priced, and a company can wake up one day, as AIG did in 2008, and find out they're in a terrific hole. It can just blow up overnight," said Greenberger, a professor at the University of Maryland.
Experts and industry officials were skeptical that the trading was designed to protect against JPMorgan's own losses, as Dimon contended in a surprise conference call with stock analysts and reporters late Thursday.
The bank appeared to have been betting for its own benefit, a practice known as "proprietary trading," said Rossi and other former bank executives.
Dimon said the type of trading that led to the $2 billion loss would not be banned by the so-called Volcker rule, which is still being written and is expected to ban certain types of trading by banks with their own money.
The Federal Reserve said last month that it would begin enforcing that rule in July 2014. Bank executives, including Dimon, have argued for weaker rules and broader exemptions.
JPMorgan has been a strong critic of provisions that would have made this loss less likely, said Michael Greenberger, former enforcement director of the Commodity Futures Trading Commission, which regulates some derivatives.
"These instruments are not regularly and efficiently priced, and a company can wake up one day, as AIG did in 2008, and find out they're in a terrific hole. It can just blow up overnight," said Greenberger, a professor at the University of Maryland.