JPMorgan to Sell $13 Billion of Bonds in Largest Bank Sale Ever
(finance.yahoo.com)
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I've heard some rumors that the large banks are clambering together all the capital they can to cover their margin calls that are about to go bust, so there's no telling what this move was for, but it is a MAJOR move nonetheless.
I don't think the bank gets margin called - the bank MAKES the margin call.
This definitely needs to be looked into a little bit.
The way these $$$ multiply as they switch hands and different parties get to 10x it is too fucking retarded. It's so retarded that you tell people about it and their answer is "no way, there's gotta be more to it"
Nope, there isn't more to it. It's actually retarded.
Unless they somehow divorced commercial and investment banks again, yes banks could be margin called. That is why 2008 took out so many banks.
It’s incest on purpose. They all tie themselves together in huge layers so when one goes down it threatens all of them and they get bailout.
ah. thanks for writing this out for me. You're right.
If you know....who would be margin calling the bank?
Usually other banks. If you read about the final days of Bear Sterns, that will give you an idea of how it goes down. They call in margin calls, or they refuse to reissue “commercial paper”.
Most big businesses and banks have revolvers or commercial paper, revolving amounts of loans like 2-3 billion that they use for day to day operations. This is the lifeblood of the company.
Once things start getting shaky, other banks will begin to refuse to roll over, or revolve the commercial paper loan. These are very short term loans that get renewed automatically usually. Then one day the banks say fuck you, that revolving 2 billion you have access to? It’s gone.
Once that happens, it’s over. No commercial paper means no business.