Regarding Bear Stearns as posted by dwecke2000. The US Comptroller of Currency (OCC) publishes information on the National Amount of Derivative Contracts for certain banks that report to it. I itemise below the data for the top five commercial banks involved in this procedure. The report is for the 30th September, 2007 in $millions.
Bank --------- Assets ----- Total Deriv-- Total Credit Deriv
JP Morgan-- 1,244,049 - 91,734,451 --- 7,778,273
Citibank------ 1,233,325 - 34,004,072 --- 3,037,062
B of Am------ 1,290,376 - 32,074,527 ---- 1,575,310
Wachovia-------- 557,018 -- 5,165,545 ------ 401,315
HSBC------------ 181,811 -- 4,439,684 ---- 1,139,480
Total All--- -- 9,301,467 - 172,175,332 ---- 13,989,216
JP Morgan is the king of derivatives with 91.7 trillion which is 53% of derivatives held by US commercial banks.
It has 7.8 trillion of credit derivatives out of a total of 13.9 trillion and only 1.2 trillion in assets. Credit derivatives are often volatile. These are the guys trying to bail out Bear Stearns.
Its(JP Morgan) credit exposure to defaults is $4.16 to every dollar of its assets.
It is believed that this is why JP Morgan tried to rescue Bear Stearns because it is so highly exposed itself.
This whole picture does not inspire confidence. I believe that we will see more bloodshed
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Regarding Bear Stearns as posted by dwecke2000. The US...
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