ProPublica reports that JPMorgan is being investigated by the SEC to determine whether or not the bank adequately disclosed to investors that the securities that went into a CDO were selected by hedge fund Magnetar Capital, which was betting against the deal (JPMorgan apparently lost approximately $880 million on the deal and what’s more). Two problems seem apparent up front– one, unlike Goldman Sachs, whose CDO had the badass name of ABACUS, JPMorgan’s version is called “Squared.” And two, no one has said anything about the role of a Frenchman who describes himself as “fabulous” and writes gushy emails to his ex-girlfriend on the company dime. That’s not going to bode well for JPMorgan when it comes time for Congress to decide whether or not this thing is worthy of a hearing and/or Senator Carl Levin describing it as “shitty” 700 times on live TV. Given that everything on Wall Street is a competition, and JPMorgan is no poor man’s Goldman, I’m going to go ahead and tip off JD and Co as to the only way they’re going to be able to come out on top of this thing. If this woman’s involvement in the deal comes to light: Read more »
- 01 Nov 2010 at 4:53 PM
- 09 Apr 2010 at 4:56 PM
Jesse Eisinger and Jake Bernstein of ProPublica just published an exhaustive narrative on what has become known on Wall Street as the Magnetar trade.
We won’t ruin it for you, but basically the giant Chicago hedge fund, started by former Citadel trader Alec Litowitz (left), helped create $40 billion worth of extremely toxic CDOs after housing prices began to slide in late 2006. With the help of nearly every bank of Wall Street those CDOs were sold to other investors. Read more »
- JPMorgan Investigated For ABACUS-Like Deal So Far Lacking Similar Intrigue November 1, 2010
- Ken Griffin's Lawyers Have Something To Get Off Their Chests July 24, 2014
- Renaissance Technologies: Buy-And-Hold Investor July 1, 2013
- Barclays: Attorney General Not Sophisticated Enough To Understand How Our Dark Pools Work July 24, 2014
- Opening Bell: 07.25.14 July 25, 2014
- Wharton Alums Not Interested In Spending Any More Time Together Than Absolutely Necessary July 24, 2014
- Ken Griffin's Title As World's Richest Illinoisan In Peril July 24, 2014
- Hedge Fund Manager Thinks World’s Just About Over This Whole Apple Fad July 25, 2014
- Memo To Herbalife: Bill Ackman Will Make This An Extracurricular Activity If He Has To July 24, 2014
- Bear Stearns Exec Who Straddled World Of Wall Street And Magicianry Is No Longer July 25, 2014
- Executive Editor
- Bess Levin
How Can We Help You?
- Send tips to:
- For tech issues email:
- For advertising or events email:
- For research or custom solutions email:
- Dealbreaker is published by Breaking Media.
For a full list of our sites, services and staff visit breakingmedia.com