EM trading must su-k to lose this much money when all others are creaming. TGs leadership of Trading is equally bad to her leadership of HR where she systematically f’d the company for the long term. BP, Shell and the trading houses are all claiming industry high earnings and we lost a boat load of cash. Amazing. TG and DWW should be NSId out of the business and not golden parachuted
5 replies (most recent on top)
@aa JP Morgan explaining this ?? Let them explain the 2012 London Whale case resulting in 6 BUSD losses … then you will understand risk of derivatives
@aa, so your point is that hedging losses are somehow an inherent part of doing business? Funny, because we went for decades with limited hedges and we never had blow ups like this before. In the current trading era, we are now 0 for 3. Recalling that every hedge has a counterparty, others are now 3 for 3 at eating our lunch.
Whoever you are posting your well informed insider views, perhaps you are a little too close to the issue to be objective. This is a time for self reflection and course correction. Maybe you’re not the right guy or gal to be running that strategy right now.
@aa that really depends on nature of the hedges used and the overall macro economic environment and level of integration.
Should the global economy go into a recession and demand destruction occurs, the use of derivatives may actually cause more earnings volatility due to inventory effects, margin compression etc etc.
Use of derivatives in normal markets works well but in crisis may not be as effective…
OP, there is already a thread about this. And derivatives marking is already well explained….including by the JPMorgan guy interviewing DW in the earning call. It is also explained in the earnings calls of all the other oil majors. If you are saying you still don’t understand it, then that is a ‘you’ problem.
The worst is yet to come...