Our guess is that at some point, either the risk of the trades was spotted for real (see above, re: journalists) and/or, as previously mentioned, the CIO stopped managing the hedge ratio on the curve trades. Stop managing the ratio, and the trade will turn into an outright long or short position on credit.Read it at FT Alphaville
[JPM Whale-Watching Tour] Too Big To Hedge
By Lisa Pollack
Strong, detailed explanation of the likely position held by JPM and how the position moved against them. In this round of hedge funds vs. the banks, it appears the hedge funds won.