Friday, May 11, 2012

JPMorgan's trading loss could support case for tighter regulation

Welcome to the morning roundup. The big story this morning is JPMorgan Chase & Co.'s $2 billion trading loss, which the bank announced after the markets closed Thursday. Here's a look at related news.

Support for regulations? JPMorgan's massive trading loss could help make the case for tighter regulations, the New York Times writes. As the economy has recovered, banks have successfully fought for exceptions to new government rules, but JPMorgan's announcement marks "a crucial moment in the debate," one expert told the Times.

Dimon trips up. The Wall Street Journal examines what the misstep means for JPMorgan CEO Jamie Dimon, one of the nation's most successful bank executives in recent years, calling his acknowledgment Thursday a "rare blow."

Moby Dick. In another take, a Reuters columnist says JPMorgan's "Ahab has met his Moby Dick." Dimon has worked hard to build a bank strong enough to stay afloat in a shaky economy, but the $2 billion hedging hit will put his bank to the test.

Embracing risk. JPMorgan chief investment officer Ina Drew, head of the unit responsible for the $2 billion loss, has long embraced risk, Bloomberg reports. Her operation has been transformed under Dimon to make bigger speculative bets with the firm's own money, former employees told Bloomberg.