How JPMorgan's $5 Million Loss Rose 80-Fold In Minutes After "A Confrontation Between Traders"

Actually that title was misleading: there will be no disclosure of "how", because we don't know. What we do know is that thanks to the magic of JPM's definition of "Mark-To-Market" accounting, a $5 million prop trading loss (and thus forbidden by the Volcker Rule) funded by depositor cash as it took place in the infamous CIO unit whose job was to manage "excess deposits" in a prudent manner, became a $400 million prop trading loss in the span of 88 minutes. But not during trading - the market was long closed. The adjustment was purely on paper. From the JPM Task force report on the CIO "London Whale" fiasco, as referenced yesterday: April 10 was the first trading day in London after the “London Whale” articles were published. When the U.S. markets opened (i.e., towards the middle of the London trading day), one of the traders informed another that he was estimating a loss of a...