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tv   Closing Bell With Maria Bartiromo  CNBC  May 11, 2012 4:00pm-5:00pm EDT

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pop get hurt. >> there's the "closing bell." s&p down 1% for the week. welcome back to the "closing bell." i'm michelle caruso-cabrera in for maria bartiromo. she's back on monday. a second straight weekly decline. the dow is set to close lower for the seventh time in eight sessions. financials remain a drag. no surprise after the $2 billion trading loss. david gregory is speaking exclusively to chairman and ceo jamie dimon. he's going to join us with the highlights in just a few minutes. >> we finished today on wall street. s&p 500. we were better earlier in the
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day. you can see it ended in negative territory. s&p down about a third of a percent. we did end up down about 1% for the week. the dow transports were down 1.6%. u.s. banks got hit the hardest today and for most of the day the sectors were green. >> if you want to know what is all the noise, there's a huge crowd of 14-year-olds here. they are very cute. >> one of our next guests, barry shown, sees jpmorgan at the beginning of a downward spiral for the banking sector. erin gibbs is here, also. good to see you, sir. tell me why this is going to be a big negative.
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>> well, we seem to believe that banks are going to be forced to continue to delever and the deleveraging process is going to reduce their earnings power which is going to show up in lower stock prices. >> erin, what do you think about that? >> we definitely are a little hesitant and don't have a positive outlook particularly on the larger global banks. we feel there's litigation risk but also in exposure to europe in general. >> is this a one-off event or other potential derivative time bombs fleeting around out there in other banks? is this going to be something that we'll see a lot of, for example? >> i certainly don't expect it. and even with jpmorgan, though it was, yes, a $2 billion loss, they are still expecting $5 billion in revenue this quarter.
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it's still something that they can handle. >> what would you do, mr. shown, as a result of your position? what are you thinking in terms of investing? >> i don't think this is an issue of a time bomb but i think it's an issue of letting bank have federally guaranteed ability to run money and putting money into things that, frankly, are more risky than they should be able to put things into. bank should be making vanilla loans to small businesses, making vanilla loans to consumers and to large bess. >> what if they need to offset the risk of the loans. >> why not? loans always go bad. it doesn't matter how good you are, some loans go bad. >> not if the loans are done with good credit criteria and there's enough cushion. >> so you're expecting 100% payment? everybody is going to get it right every time? >> no, not exactly. but if you make 60 to 75% loan
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to values, with good operating businesses and a good enough cushion, that self-regulates it and that's the way the banking industry was run for years and years, except for the last 20 years where financial derivatives ruined the financial system that worked very properly and grew the economy many times over and over again. >> and, of course, nothing has been globalized? nobody does business all over the continent. we should be doing just little loans here in the united states and close off all of the walls? >> i think that's an unrealistic expectation. it's a challenge to be able to understand your books, hedge it. it's quite complicated. so i think the expectation that that will never happen is unrealistic. >> what should the average person looking at this come away with? is this a sign of another crisis in the making? try to put this into a proper perspective.
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>> we're still expecting the u.s. gdp growth to be 2 1/2 for the year. we see a lot of positives elsewhere. >> this particular jpmorgan story, is this an indication of some further crisis in the banking system? >> no. >> thank you so much for joining us. >> thank you very much. >> erin, thank you. we asked you to chime in on twitter if another banking crisis was coming. here are some of your responses. the tank told us, the tank, we are in a banking crisis. too much money in the hands of too few hands. freedom has value, if sheila bair and others have their way, we'll be on the with us p of another government overreach crisis. and bob says, we have enough red tape. focus on cutting expenses and growing jobs.
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continue to send your responses. >> what do you do in this day in age when you have to manage risk and managing risk is risky. >> what jp did was proper. they made a hedge. unfortunately, they were wrong. hedging is not an absurd idea when you have those kinds of trades. >> hedging can always go up. a lot of times you'll hear somebody say, that airline is so smart. they hedged 100% next year. let's say they hedged at 80 and the price of oil hedges at 40. they look stupid and lose a ton of money and competitors come out more profitable than they do. >> hedging is very typical in parts of the corporate world. gold companies, for example, most of them hedge for many, many years. >> exactly. >> and whenever the price of gold went against them, they say it's crazy, the gold companies should not be hedging. it's used very widely. >> yeah. all right. let's take a look at the business headlines. gold hit a four-month low. the first weekly drop since
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march. investors are liquidating to cover losses in other areas. gold settled down at 1583.60 an ounce. the latest government report out of canada showing second consecutive month of strong job growth north of the border. our neighbors adding 58,000 jobs in april. stick around. much more to come, including jpmorgan's massive trading loss and much more. >> will jamie dimon survive this trading loss or has he actually handled it quite well? plus, does this increase the debate for more intervention? next on the "closing bell."
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the most. kayla tausche has the details. kayla? >> facebook is holding its final meeting in palo alto with mark zuckerberg fronting the show.
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he will be ringing in the debut from california while plans for new york are still getting nailed down. despite reports of weak demand, the offering is pretty hot. lackluster numbers only slightly diluting what is seen as a lackluster offering. the price range could rise next week. stay tuned. four deals were withdrawn just this week and volume has fallen off a cliff. when deals get done, the market hasn't been very kind, nearly half of ipos have priced below expectations. that's up from 25% of deals last year. so while the premarket summer swings look awfully similar, the market for ipos is not benefiting from as robust a lead. the vix has been suppressed and stacked with some 81 deals, they won't be able to hit the market
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running without at least a couple weeks of what i'm told is going to need to be a neutral positive market and we certainly haven't seen that yet. bob? >> no, we haven't. thanks very much. ahead of the mega offering, it's been revealed that eduardo and $20 billion unit from america to singapore to p and g will admit that it is tax advantage. ron insana, it's not the taxes. it's the shopping, right? >> it's a very clean country. you know what the rules are. >> who knows where they are resourcing. they have a great international footprint and likely the tax treatment will be better there than here. he's not a natural born citizen of the united states. he got his citizenship in 1998.
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he came here in 1993. he's got broad interests. clearly, there might be some motivation to dodge a capital gains tax on over $3 billion, which the stake is estimated to be worth. but that is conjecture. no one seems to have spoken to him and they are just pointing out that he renounced his u.s. citizenship as it's called. it's not a denounce asian of the country. >> he can be a very well -- be a businessman who wants a footprint of his own. but, yeah, would you blame him not being a natural-born citizen for trying to find a haven for what's going to change his life? >> that's the distinguishing point, right? he was resilient, became an american citizen and now is going on his third country. i mean, we hear about wealthy
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people talking about renouncing their citizenship if they start raising taxes but the concept to the average american, at least to me, makes me want to cry. i mean, i can't imagine even the thought of it. it's just horrifying as an american-born person. >> of course, we're born here. domestic chinese are looking to come to the united states for a better life and to protect their wealth because they are not comfortable with the political environment there which is an entirely different and in fact more scary statement for someone to make. i don't want to live in china because i don't trust that i can keep my money. he's free to do what he likes, as we said. it's interesting, people make she's decisions. some people used to move to switzerland in the old days. you could have swiss bank accounts in the old days. a lot of that has changed. >> and global citizenship. he's not a citizen, wasn't originally a citizen of the united states. do you think facebook is going to get any kind of negative blowback? >> no, i don't think anyone is going to make a decision based
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on this. as kayla just reported, it's going to be an interesting offering. people will question the valuation at 100 times earnings and google went public. 266 times earnings. so, you know, it's going to be a watershed ipo for this iteration of technology companies. it's important. but i don't think that -- and, again, the use of the word renunciation, it's a whole different kind of -- the way it's described makes it sound worse than it actually is. >> good to see you, ron. >> you, too. thanks. >> go to cnbc.com for our extensive coverage on the web including what we know right now about the ipo. bob corker, on the banking committee, is asking for hearings on the matter and new
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york attorney general eric snyderman is asking for new, tougher regulations. >> there are some regulations that need to be instated, in some cases reinstated to ensure the security of the market so we don't get into the kind of crash that we did in 2008. >> is he right or are are the markets working as they are supposed to? the debate coming up. and don't go away. david gregory is interviewing jpmorgan chase chairman and ceo jamie dimon right now. as soon as they are done, david will join us with highlights of his exclusive right here on cnbc. stay tuned. don't miss mr. dimon's interview. plus, we're going to tell you why france's new socialist president may look a lot like sarkozy when it can comes to austerity. and i thought "i can't do this, it's just too hard." then there was a moment. when i decided to find a way to keep going.
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forecast for the entire region but sarkozy has been making pretty strong statements about france's budget woes already. >> john brown saying hollande will stick to his guns and simple math is going to force him to compromise. it didn't raise a red flag for you? >> i think europe is already in recession and heading fast towards depression and like most socialists, he's going to take the easy option of more quantitative easing and federal reserve chairman bernanke and in doing so he will be supported by the angry american elite that support debased money and the struggle against strong us a industry general school money led by germany. so he will leave germany. this will force germany out of
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the euro and out of the european union, i can see. >> we're not going that far. you've gone too far. we're just talking about whether or not we actually think he's going to give himself cover so he doesn't have to do everything that he promised to by saying that sarkozy left it worse than he thought. >> i think he will do what he said. >> keep on spending away? >> yes. >> steve, is the math going to force him to compromise? >> well, yeah. the country is pretty much broke. there isn't a whole lot of money to spend. these tax proposals, it's questionable as to whether they will even pass because he's talking about raising rates on people making more than $1 million euros a year at 75%. the constitutional part of france, essentially their judiciaries have come out and said it's not judicial. he's going to have trouble doing
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that. we have parliamentary elections coming up in june. he's going to be probably sharing power with the communist putting a lot of pressure on him to do more but i don't know how he's going to be able to do it and the first thing he does after being inaugurated, he flies off to berlin to meet with angela merkel. he's boxed in here. i don't quite now -- >> the number has got to be somewhere in the middle, isn't it, john? >> the problem is they force germany out of the euro and out of the euro zone, creating chaos and more centralization of power. it's a very serious situation and it's part of the great titanic struggle in the world. >> it's a rather strange scenario, john. >> this is the problem. the problem is he doesn't have quantitative easing as an
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option. the ecb controls that. >> exactly. >> just mark my words. the angry american elite is controlling and they are heading into depression. so they will be very popular quaint taf t quantitative easing and germany will end of limnking with china and it's a huge struggle getting -- >> wour. >> the american elite -- >> is that geithner? who is that? >> the american elite is debased currency beyond belief. one 1940 dollar now is worthless than 3 cents and the germans don't tolerate it and will move out if they are forced to by the angry americans.
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geithner was there putting on great pressure to debase the euro. >> guys, thank you very much. >> appreciate it. >> jamie dimon was once termed the least hated banker. but has the latest debacle changed all of that? david gregory is here and we'll get his reaction to the loss right here on the "closing bell." >> why didn't the regulators do anything until after the fact? we get into that and more, next. d science initiative... ...which helped students and teachers get better results in ap courses. together, they raised ap test scores 138%. just imagine our potential... ...if the other states joined them. let's raise our scores. let's invest in our teachers and inspire our students. let's solve this.
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nbc's david gregory just sat down with jpmorgan chase chairman with jamie dimon about the great trading loss. he asked how far the investigations may go. >> the immediate question, the s.e.c. is looking into this. did the bank break any laws? did it violate any accounting
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rules or s.e.c. rules? >> so we've had audit legal risk compliance and best people looking all over that. we know we were sloppy. we know we were stupid. we know there was bad judgment. we don't know if any of that is true yet. they will come to their own conclusions but we intend to fix it, learn from it, and be a better company when we're done. >> david gregory is joining us. hi, david. right off the top, he didn't answer your question directly about whether or not they violated anything. he's waiting to see what happens here. >> right. i think he's taking it pretty careful approach to the fact that, you know, he wants to be open and transparent at this point about what's gone wrong and he knows people are going to look into this. there's already been talk about hearings surrounding this issue on capitol hill and as he talks about in the interview, there's no question that he's given new ammunition to regulators, particularly in the volcker rule
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and how banks operate. he seems to welcome that new scrutiny. i don't they he's necessarily changed his views about how regulations ought to be applied. and his bottom line to me and of course in my interview, he does not think that the financial system or even the banking system is overly risky. so he defends the practice in the course of the interview but i think my interest, looking at this and what's happened over the last couple of days, is that we are looking at a potential new glash clash between washington and wall street over these new regulations. >> was he at all contrite over the fact that he's been such a leader against dodd-frank, against regulatory burdens? how did he feel now that he's sort of insnared in this issue? >> well, i've been with jamie dimon a couple times this week because i spoke about the politics in ohio before all of
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this went on and sat down with him this afternoon. i do think that he's contrite about this. he's eager to lose the label of the king of wall street and the guy whose sterling reputation at risk management is untouched. he realizes this is a huge mistake and feels accountable for it. where that accountability will go and how far it will go, he will admit, is unknown. his view about regulation is not that he's opposed to it but how specifically it gets applied and a lot of the detail applications that come out of the volcker rule. i can tell you i don't think that has changed but he recognizes in a political climate he's made a huge mistake here. >> i wonder if you can give us any clues on the chronology. you spoke with him earlier in the week. i'm very, very curious, as he's sitting with you in the first interview, he knows what is happening here and would he have been saying all of those things
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and agreed to that first interview if he knew that there was going to be a big blowup? any idea of the activities in between? did he know all of this when he sat down with you for the first time? any sense of that? >> i don't have an exact sense of it. what i know is that they've committed to doing an interview and wanted to honor that commitment. we certainly wanted to talk about issues in the campaign, the broader economy and issues surrounding wall street and you'll see all of that on "meet the press." he called me yesterday and said, i'm really sorry, i couldn't discuss this with you but there were disclosure rules and i had to do it all at once and there's this big thing that's going to happen and we really screwed up and you'll hear all about it. so that was the chronology. i honestly didn't know. he agreed to do it. i asked him, i said, i'd really like to question you about these things and he agreed to do it. >> we're hearing -- jpmorgan is being downgraded.
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i think there's already repercussions. is there any sense that he's undertaking a review of the risk that he has out there? there's all this talk about him causing about but did he say at all that he's looking into the risk, rather, what they are doing right now? >> yes. it certainly appears, based on even the answer that we played there, that they are doing an internal audit, internal legally and financially to look at where the mistake was made. as i say, he still defends the practice and talks about hedging as actually a way to avoid risk or manage risk within a bank. and i realize i'm speaking to more of an expert audience in lay terms but he defends that practice and i even asked him, where were the warning sign? were you in denial of this? did you simply ignore warning signs? and he minimizes how clear this was along the way but makes it
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clear that there's more questions he'd like to have answered. >> thank you, david. great stuff. we look forward to seeing more of it. really appreciate it. >> thank you. >> don't miss that exclusive interview on sunday on "meet the press". fitch has just downgraded jpmorgan after the $2 billion trading debacle and they are still on watch for further repercussions. >> he thinks dimon survives this just fine but michael says the bloom is now off the rose. gentlemen, what do you think? the downgrade, your reaction to that? michael? >> i think obviously it pushed them over the edge but this is a company that has $4 billion that is taking a $2 billion hit. the company is still improving the quality of its earnings. they are moving in the right direction. this certainly is a hedge that has gone way wrong. >> let me ask you this, though. hold on, fitch says the magnitude of the loss, the ongoing nature of the position they say implies a lack of
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liquidity and raises questions about jpmorgan's risk appetite, risk management framework, their practices and their oversight. do you disagree with any of those things? >> no, i think it absolutely raises questions. they are a very well-capitalized bank. i don't disagree with those issues. this is not something to be swept under the rug but i think it's simply a very are, very big bug. we'll have to see how it plays out over the course of the next several days when we start unwinding all of these trades. that's where really the real problem is going to be exposed, how big is this issue? as it stands right now, this looks to me to be a one-time issue given the information that we have right now. >> zachary, fitch says they view the size of the loss as manageable. that said, the magnitude of the loss and ongoing nature implies a lack of liquidity. >> yeah. on that one, bob, i have to say,
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that seems excessive and i don't have a lot of respect for the way the rating agencies have conducted themselves over the last several years. the fact that fitch downgrades jpmorgan would not normally be a resounding reason to doubt jpmorgan. i do think the facts of this, coming from someone like jamie dimon who has earned a lot of respect on the street for being direct, straight, for standing up to the unnecessary thick of the regulations, the fact remains, you cannot have trades of these magnitudes go wrong without somebody not having the correct oversight. i mean, it's a big bang. they have $100 billion in revenue but potentially $4 billion in losses is massive money even under those terms and that has to go right to jamie dimon. it's not something that can go on without something breaking down the system and he clearly knows that. >> and i i agree with you on the rating agencies, 100%, zachary. but you do agree when they raise
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questions about lack of oversight and -- >> i understand what you're saying. jpmorgan is not suffering from a lack of liquidity. the reason for the strategy, at least as we currently know it -- >> the reason for keeping the positions on or trying to run them off? >> right. so i think this is not a liquidity issue. banks have been hoarding liquidity, partly in response to regulatory environment and partly because they are risk aversion. this is risk aversion gone awry, not risk. it's gone the other extreme. >> they themselves, and fitch themselves says, it's very difficult to assess the risk of exposure, the trading loss is precisely the kind of risk factor associated with this kind of business model. fitch believes, though, that it's a highly confident sense of business and the longer term implications are not yet known. fij fitch is hedging itself as well. >> we've brought this up a
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couple times on the show. hedging is supposed to smooth things out but it can go very wrong. we mentioned the point about airlines earlier. an airline hedges out at a certain year for a price and hedge oil at 80 and it goes to 60, they look stupid and they lose a lot of money. i mean, hedging can go all in different ways, right? >> yes. this is obviously not hedging anymore. as soon as you move this kind of loss, you move away from portfolio insurance, asset insurance, you move into a pure bet. let me say something about jamie dimon as well. he's earned the respect as many people on wall street as being a straight shooter and i think there should be some credit for him being as candid as he has been, that they made a mistake, you're not hearing the double talk from ceos that you often times here. he's owning up to it. will the buck stop with him? undoubtedly so. the heads that will roll will not be jamie dimon, perhaps those running the derivative
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desk. i think jamie dimon will get over this. >> what would happen if he went away? >> unless we know more, unless this unfolds in a much more systemic clee negative fashion, he's probably earned, both from the board perspective and shareholder perspective, the right to have one massive, massive mess-up. but he certainly doesn't have the right and will not be granted that for a second one. and, look, he's got to know this. he's an intelligent man. i do think -- >> we want to continue this discussion after the break. >> okay. the downgrade by fitch of p jpmorgan that just happened. we'll explain that and discuss where regulators were when jpmorgan's bad trades were brewing. stay tuned. hi, i'm jon fortt and this is tech check. if chinese tech companies get
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what they want, we'll soon see a lot more of their smartphones and tablets in u.s. stores. case in point, the number of chinese mobile vendors at this week's conference in new orleans almost doubled to 55, pitching the range from infrastructure to phones, mostly aiming for the lower end of the market. the biggest networking company had the biggest presence. launching an aggressive brand recognition campaign in the u.s. it's been selling white label phones to carriers in the u.s. but now wants to make a name for itself. >> it's not just about huawei, it is bringing benefit to our customers. >> the total u.s. sales last year, $1.8 billion. it will have to grow that fast to compete with samsung and htc. >> that's your tech check. i'm jon fortt. ♪ i hear you...
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>> with us is michael greenberg and ceo tim ryan. tim, let me start with you what's your view of this whole thing? do you see this as a failure of the regulatory side or a failure of internal risk controls? how do you look at this? >> yeah, i see this as clearly an unfortunate situation. mr. dimon has talked about this and really it's a mistake. it's a hedging tragedy that went wrong. i'm hoping that this situation is not a -- used as a sledgehammer for more regulation. >> but it will be. senator corker is already calling for hearings. you know what, he asked a really key question in his letter, if we can bring this up. question number two in this letter, were these bona fide hedging transactions, which presumably would be all right, that's not his wording, mine, or
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were these poorly managed trades? less acceptable. and what precisely is the distinction, sir? that's the problem. in the end, they still lost $2 billion. >> well, as you know, because we've talked about this on your shows before, a key issue now before the regulators, the s.e.c. and everybody else, is how are we going to draw this line between market making and proprietary trading and obviously this brings up another issue which is the bona fide hedge exemption? >> michael greenberg, what's your take on all of this? what is this an example of and what, if anything, should be done about that. >> well, as more evidence comes out, this becomes clear that this was a flat-out bet on the way that index was going to work it had no hedging purposes at
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all. >> hold on. we don't know that yet. >> we can't prove that. >> i'm sorry. there's wire service reports out for weeks, this london whale has been called out, disrupting this market. >> that doesn't mean it wasn't a hedge against corporate credit that they had on the books. >> if jpmorgan -- even if this was a hedge, the so-called lincoln rule, when it goes into effect, would ban uncleared credit default swaps and the reason that they are banned is, they have to be cleared so they are capitalized and transparent. speaking of trans parn tea, i think this will become a great shock to the fed. this do not have the ability anymore to bail banks out. if somebody, such as the republican senator you're nominating, is calling for hearings about this, this is a widespread gap in the repeal
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dodd-frank mantra. we don't need to repeal the dodd-frank. we need to enforce the dodd-frank. the volcker rule would have stopped this, the lincoln rule would have stopped this. the exchange trading requirement would have stopped this. >> hedge against the risk that they've taken on because of loans, what should they do? >> they are hedging with our money. if those loans are so unstable -- >> because they are trying to prevent future losses on loans that they've extended. nobody thinks this is a perfect science. where is the tradeoff. >> and what have they done? they've lost $2 million and the market is clear, they can not unwind these trades. >> you haven't answered my question. what do you do to offset the risks that you've taken when you extend loans? >> what did we do before there were swaps? we made sound loans. that's what we did. this is a hedge -- if this is a hedge, if you listen to jamie dimon, he is totally baffled and
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mystified as to how this happened. he's the smartest guy on wall street. he was supposed to have veered through the crisis and you cannot help but listen to him say it's egregious, self-inflicted, sloppy, if that's the way they are hedging, the american people need to be protected against this. >> i have to say, i think your criticism is correct in certain respects but the whole ten nor of it misunderstands the fact that the only solution to what you're saying would be to break up these institutions. part of jpmorgan is depository clearly but to say that was our money, they have institutional money, they have pension money, they have their own money and it's all in one thick soup. >> i think we get the point here. may i have one second here, please? i think you've had an awful lot to say, michael, already, most of which is wrong? >> mr. ryan, can we let -- mr.
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ryan, go ahead and respond to that, sir? >> we're having a filibuster from michael which i don't think is useful. most of what he says does not water at all. i think the discussion about volcker is probably irrelevant. the most important thing is this was a mistake. we're not talking about customer money. we're not talking about government money. we're talking about jpmorgan's money and the impact on its shareholders. they've made a mistake. they've been very transparent about it and we don't need regulations to change the way banks do work in the united states. >> do you think the fed was surprised by what happened today? michael said they were but i don't know why they would be. >> i have no idea how michael has all of these sources. >> they were surprised because these are nontransparent secret
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transactions and they will become transparent if dodd-frank goes into effect. >> wow, we have nasty words. >> well, i was accused of a filibuster. >> we have breaking news. you've gotten to talk a lot, sir. thank you, mr. ryan. >> okay. julia -- julia has breaking news on facebook here. >> yes, that's right. the folks here -- i'm here in palo alto. facebook tells us that the may 18th ipo date is still uncertain pending s.e.c. approval. that doesn't mean that it won't happen next week, it's just that they haven't given the final signoff yet on the may 18th trading day for the ipo. the q and a session just wrapped up. they filled in a lot of questions about mobile in particular as well as the advertising model. what zuckerberg's vision is and what the potential is from a
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monetization standpoint. back over to you. >> kayla tausche, your thoughts as we hear from julia that we are not absolutely certain publ today. >> i think that this is pretty usual course. a company can't say it will start trading until it gets the rubber stamp from the sec. they have not been declared effective. and that means they will need the final rubber stamp. >> we have to cut you off because we have to get to phil le bow with breaking news. >> what are we reported to you in the last hour, they agreed with the creditors in the bankruptcy case and they will look at offers that are out there on the table. it will look at other merger options ahead of when it said originally that we were going to reorganize until september and now they say they will work with
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the committee to consider other merger potential options. that doesn't mean there will be a transaction, but it means they will look at the options. >> they are talking about u.s. air? >> listen, somebody else is going to come to the table. don't expect them to be the other one. others will come to the table. >> who else is there? >> i think you can probably see private equity coming together where we think maybe we take a piece of a different airline here or there. >> they are official low for sale. >> we have the latest on the jpmorgan developments. we'll be right back.
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proponents on tougher regulations on banks are having a field day with the trading loss. >> they have been listening to the last hour. maria bartiromo had the money man in the white house. austin ghouls bee. they are airing this sunday. here's some of that interview. >> let me kick it off with the $2 billion loss from the chief investment office.
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i find it interesting because it's jamie diamond who is vocal against the vocal rule against the idea that more regulation is going to hamper what they can do in terms of proprietary trading. does this set the bank and the industry back in terms of more regulation? >> i think it does. i wouldn't a more regulation. that's the regulation they passed. this is exactly what the vocal rule was intended to prevent. you saw the reports from the "new york times" that the regulators have been all over this exact position trying to figure out why they have a big position. whether it's a proprietary bet. it feels like every time the phi marshal sector gets the bobbying up enough to knock down the rule, events come back and push it back to the forefront. whether it was conflicts of
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interest between banks and their clients or the riskiness of trades for institutions that are insured by the government. this is a bad situation. i'm friends with jamie diamond and i believe he is a straight shooter. i disagree with him on that's this rule. if a company had as good of risk as jpmorgan had cannot prevent multibillion losses in an environment that is not as topsy curvy than the ones we have seen before, it raises questions about can anybody do this. >> you can get the interview sunday on the "wall street journal" report. check the local listings for time and channel. before we go, let's recap the weeka wall street. the dow jones average posting the worst weekly design since december.
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blame it on cisco or jpmorgan chase. for the week, the industrials tumbling 2.18 points and the s&p closing at a two-month low for weakness and materials and industrials and financials and falling for a fifth week. >> it's one thing for austin to make the comments, but which you are calling for hearings, they are in a tough situation. >> that are does it for the closing bell. thanks for watching. >> have a good weekend, everybody. high schools in six states enrolled in the national math and science initiative... ...which helped students and teachers get better results in ap courses. together, they raised ap test scores 138%. just imagine our potential... ...if the other states joined them. let's raise our scores. let's invest in our teachers and inspire our students.
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