R.I.P. JPM
How do bank runs start? Why do they happen so suddenly? What happens when a "too big to fail" bank actually fails?
These are the questions that will be asked in the days and weeks that follow. Jamie Dimon showed his cards yesterday when he said this...
"I do want to remind you that none of this has anything to do with clients."
http://www.marketwatch.com/story/miss-jamie-dimons-conference-call-hear-it-here-2012-05-11-1150520
It took just a few days for "clients" of Lehman Brothers to head for the hills which ate up their tier one capital almost instantaneously. Leverage is great when you are winning but a real bitch when you are losing. It is clear to many that JP Morgan's losses are just beginning to surface so how long will it take for their "clients" to head for the hills? Will JPM still be solvent next week? Who knows.
I do know one thing though. Every single holder of the "Big Silver Short" has gone belly up! It started with Drexel Burnham in the 1980's then got passed to AIG then Bear Sterns and it now presides at JP Morgan.
If no one takes the torch from JPM we will see the end of Silver market manipulation very soon.
Have a restful weekend.
Bix Weir
PS - For Private Road Members - My computer crashed and erased this week's Road Trip...yep, the dog ate my homework! Given the nature of the JPM news it was mostly anticlimactic anyways.
So here's the best of 2011 for you to chew on over the weekend. Next week should be a doozy :-)
The Best of 2011 Road Trips
