[Cid_Yama]

Did this 'rogue trader' really steal/lose $7 bln? Or did he really steal a couple million and Societe Generale is using him to cover $7 bln in mortgage derivitive losses.

"I am sorry but I have a hard time buying the fact that a trader was able to set up a 'secret trade' of 4.9 billion(euros) without anybody finding out," said Ion-Marc Valhi at Amas Bank.

http://news.bbc.co.uk/2/hi/business/7206270.stm

[Oil-Finder]

Nick Leeson did something similar in 1995. Don't see why someone else couldn't do the same.

[seldom_seen]

$this->bbcode_second_pass_quote('', '"')I'm convinced he acted alone," said Jean-Pierre Mustier, chief executive of the corporate and investment banking division, who interviewed the trader after the fraud was uncovered.

[Lanthanide]

$this->bbcode_second_pass_quote('Oil-Finder', 'N')ick Leeson did something similar in 1995. Don't see why someone else couldn't do the same.

[Oil-Finder]

$this->bbcode_second_pass_quote('Lanthanide', '')$this->bbcode_second_pass_quote('Oil-Finder', 'N')ick Leeson did something similar in 1995. Don't see why someone else couldn't do the same.

[anarky321]

$this->bbcode_second_pass_quote('Cid_Yama', 'D')id this 'rogue trader' really steal/lose $7 bln? Or did he really steal a couple million and Societe Generale is using him to cover $7 bln in mortgage derivitive losses.

"I am sorry but I have a hard time buying the fact that a trader was able to set up a 'secret trade' of 4.9 billion(euros) without anybody finding out," said Ion-Marc Valhi at Amas Bank.

http://news.bbc.co.uk/2/hi/business/7206270.stm

[Twilight]

I don't think there is a coverup, I think he lost it for real. While he allegedly could have been forging trades to cover up real ones for months, I suspect it was small-time stuff and almost the entire loss took place in the recent market instability. I don't think his fraud remained undetected at all, I think he was destroyed instantly, the bank straight away realised something had happened and caught him in the ensuing investigation. I am not yet ready to believe this accumulated at a constant rate over a year.

[Iaato]

Here's how to tell whether the issue is scapegoating or not. Turn on Faux news, or Bubblevision, and see whether Rogue's name is getting mentioned. And how often it's getting talked about. If it is one of the driving memes of the week, then I'm much more likely to consider scapegoating an issue.

This man, he came in the window, Dad. And he broke the bed.

[sameu]

let's suppose they're not scapegoating
then they're still idiots not being able to secure their precious $7 bn

but i'm pretty sure they're scapegoating

[xarkz]

http://business.timesonline

$this->bbcode_second_pass_quote('', '
')His mediocre abilities and limited experience have fueled suspicions that he was the visible tip of an iceberg of incompetence at SocGen, the trusted, familiar French high street bank for whom he worked.
..
His performance-related bonus in 2006 was only about £1,000, a pittance in his profession and an indication that his dealings were modest.
..
A SocGen employee who has worked there for ten years said: “I can tell you, even at the higher levels of management, no one believes the official story — it’s a pathetic cover-up.”

[Twilight]

$this->bbcode_second_pass_quote('The Times', 'H')is performance-related bonus in 2006 was only about £1,000, a pittance in his profession and an indication that his dealings were modest.

[Fences]

Just FYI,

It was in the news today in Belgium that Belgian financial circles are blaming last week's sharp dips in Bel20 and other stockmarkets on this guy's fuck-up.

They litterally said on state radio that people were watching the share go down, didn't know why it was and started panicking...

I don't believe a word of it, but it's what they're trying to make people believe over here.

Also in a highly respected flemish newspaper (the Standaard), the hypothesis that he might have acted with secret permission from high-ranking people in the company in an attempt to hide or secretly fix subprime-related losses.

Now that's a story I do tend to believe...

What are the odds of a bank losing $7bln by the fault of one isolated 'criminal', in the very periode when other/most banks are writing off similar amounts due to subprime issues, while it never happened to a similar extent before?

Ockham's razor here, I'm all for the scapegoat theory.

Fence

[Cid_Yama]

"It wasn't 'us' that stupidly invested in those American mortgage investment scams, it was HIM." - Societe Generale

[Fences]

In the news today (Standaard again):

quote "according to the bank, Kerviel did not take (intend to take?) personal profit from his actions and operated on his own"

So the guy did all this out of pure altruism and love for his employer and didn't even try to roam 0,001% of the profits he was intending to make? (sounds like the perfect CEO)

Gimme a break, ... this is rotten to the core.

[Twilight]

Actually it is starting to make sense.

I think he could turn out to be an extremely intelligent underachiever who ended up used for his brains in a data office but never rose higher because of social inadequacies. Perhaps he had a burning desire to prove his worth to his superiors and did it the only way he knew how.

The media is puzzled by lack of financial motive, but I am starting to think the driver was narcissism and social acceptance.

As for the losses (~10% of value of positions), that is probably what happens when you panic sell a portfolio assembled by a savant (or just a capable guy) with only a couple of days to study it.

[evilgenius]

If they were experiencing sub-prime losses why wouldn't they just admit it? They would only need a scapegoat for something that they didn't want to admit they were doing, like propping up the Euro in the face of pressure for it to drop because of heavy money pouring into the US to buy low. Even if they were doing that why wouldn't they just blame those related losses on sub-prime? I can't see why they wouldn't blame those losses on sub-prime unless it is more complicated than a person can imagine. Occam would say that the most obvious explanation is probably true. He probably did it.

Does anybody know where the emergency facility to cover SG is coming from and how it is structured? They aren't laundering anything I suppose, but that is possible.

[Fences]

For the same reason other banks have done all their best to hide subprime losses last couple of months.

If they can claim they lost €5bn due to the criminal mind of one individual, they can pretend to still be solid: "no worries it was all the works of one criminal and we have him now"

If they have to admit they lost €5bn due to subprime issues, they have to admit their strategy is wrong, and made mistakes. Which will make shareholders suspicious and force prices down...

btw, Mr. Day, a member of the board has just admitted he sold €85 million in SG stocks on january 9th...

Coincidence?

Anyway, of course just guesses and pure gut feeling, but still...