JP Morgan’s share price fell by a tad over 6% today after it reported that its third quarter profits had fallen by about 4%.

The bank is seen as a bellwether for the banking industry and some are saying that there may well be some more downbeat news next week.

But JP Morgan actually made a lot of gains by betting against a company it saw as a potential loser …. itself.

MarketWatch reports that ‘The end result was slightly better-than-expected but lackluster profit of $4.26 billion, for the nation’s second-biggest bank by assets. The bank reported $1.9 billion in revenue from the bets against itself — the net income from the move wasn’t immediately available.’

Now, if a jockey, boxer or footballer bet against themselves the punters would get a bit miffed would they not?

Now call me naive if you like but how the hell can this be a legitimate thing for a business to do?

Betting against yourself just means you don’t have to try as hard (if at all) to make a success of things.

Sports people can’t take drugs (well not get caught anyway), but banks can openly put financial products on steroids and not worry about any consequences (that’s the taxpayers’ problem). And sports people can’t bet against themselves but banks can.

There is some talk about whether or not this was an accounting measure, a proper hedge or a speculative trade, but surely that $1.9 billion that appeared had to come from somewhere didn’t it?

More worryingly, which pension funds lost shed loads on betting on JP Morgan, and what data were they relying on?

The only good news would be that it would become more expensive for JP Morgan to borrow money; that is if they needed to.

One also has to wonder what impact the ‘Crash JP Morgan – Buy Silver’ campaign has had on their figures.

Anyway, off to see my bookmaker to find out if he’d take a couple of grand in bets off of me to bet against myself. But first I’ll have to cook the books to make myself look at least solvent, think I’ve got some blank payslips and bank statements somewhere. I could make an absolute fortune.

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