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So it's come to this: Investment banks are making their earnings by betting against themselves,...

So it's come to this: Investment banks are making their earnings by betting against themselves, as ~25% of JPMorgan Chase's (JPM +0.2%) Q3 profit resulted from debt valuation adjustments. DVA gains of $1B for MS (-1.2%) and $300M for GS (-0.7%) were already forecast; because they faced more severe bond market stress than JPM, they may report even larger DVA figures.
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Comments (1)
  • Patrick Farnsley
    , contributor
    Comments (15) | Send Message
     
    they are not "betting against themselves". the DVA gains are a result of mandated accounting convention and will be reversed if & when the bonds recover
    14 Oct 2011, 02:57 PM Reply Like
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