tonight on "fast money", stocks rebound from a two-month low. sort of. >> the dow has turned negative. >> traders playing tango with europe all week in a volatile market that tomorrow could make losers out of everyone. >> these are all difficult bets. you don't put half your net worth into any one of these things. >> there's always the can't miss ipo from facebook? >> the mobile thing is a big deal. >> we're taking the gloves off. joe is ready to beat grosso in the post. fresh off the trading floor this is "fast money." after the nasdaq market side i'm

melissa lee. we'll get to those stories in a moment. first break news, j.p. morgan calling a conference call to address losses in the credit portfolio. take a look at this after hours after down 4% right now. keith, what do you make of the story so far is this. >> this is a problem, a big problem. whale had a big problem. net income likely to be quote unquote more volatile in future periods than in past periods because the whale had a product. the whale is common for trading unit of j.p. morgan. people have a lot of questions on this. is it prop, is it not prop, why are you doing this? >> specifically the conference call is going on right now. they're saying that the chief investment office has significant mark to market losses. legal losses of $4.2 billion. reasonably possible and j.p. morgan chase is more volatile as an economic hedge right now. >> this is the last thing that the financials need. if you look at the financials

coming out of rning season, it's been atrocious. all these big kwoetd unquote favorites have not performed well. we've seen the charts breaking down. this is probably a nail in the coffin at least short-term. >> people have been worried about a couple things. morgan stanley is going to get a rating downgrade. people are worried about the collateral to post that. this is beyond that. people were looking for j.p. gorman to post collateral this is a new issue. >> a couple things, number one as an owner of j.p. morgan i'm not happy about it. i would not buy more on the decline. i think it's interesting. this is where j.p. morgan is best in breed. they're the first to do so. they have a portfolio that needs to be mark to market. there's not just one portfolio that needs to be mark to market. there are other portfolios that need to be mark to market. what is the impact, how far does it extend on the street and what others hold what appears to be some lousy pain her.

>> what's troubling here is just a couple weeks ago j.p. morgan's management were out defending this outsized trader the london whale that had been taking these giant risks potentially. bronstein said the cio balances our risks. they hedge against downside risk that's the nature of protecting the balance sheet. a couple weeks later that it would lead to billions of dollars in losses. >> hedge is an interesting word. taking risk by definition means you really don't have a hedge, if you had a hedge, you don't know what you're rooting for within getting too inside baseball. as to joe's point, it's not -- although i can't speak to this, i can almost categorically guarantee it's not just j.p. morgan. if you look at the price action of goldman sachs at the back end of today that stock was in a precipitous decline. and now goldman was closed around 106 it's trading down to 1040. i'll say once again, i think we've been pretty vociferous in

this. banks are noninvestable. there's one you can look at, usb. the rst of these, if you want to goof around and trade them, be my guest. i still believest there's incredible headline risk. >> we've seen these guys fall after hours. we saw the trade in goldman sachs. it's also bank of america, citi group and morgan stanley seeing sizable declines. in terms of the trade on the financials do you think it's the sort of thing where you see it in the news and figure the story out laert? >> the knee jerk reaction is to shoot from the hip here. if you're in the name, i don't believe he's going to dump his j.p. morgan position tomorrow. >> i will dump my bank of america tomorrow. i bought it this morning and it was nothing more for a technical trade. i will dump bank of america on this. i know j.p. morgan's about to speak on the conference call. i won't add to j.p. morgan not

at all considering what's going on overall. >> the key is you want discipline. you want discipline with your losers, too. you can't react to this. most people aren't able to trade this after market. most people aren't able to react to this until tomorrow. that's where you have to let your judgment be your guide. wait a little bit and see if the smoke clears. >> i would be predicting that the reaction is negative. the yield spread's compressing the second quarter of earnings is in a problematic position. the fun flows into equities have been negative. then there's a big political diameter to this which is the volker rule. the volker rule comes into effect in july allegedly. and it does really have questions as to what is and what is not prop. that's a big focus of what j.p. morgan has to deal with at 5:30. >> there's one analyst on the street this week just three days ago who was advising investors to get to the sidelines on j.p.

morgan. >> banking industry is a later version of what's taking place in japan. you cannot escape the pressure on margins, loans and overall revenue growth so j.p. morgan might be good. diamond might be good, he cannot escape the environment where he's operating. >> the environment in which he's operating. you can escape the environment or you should be able to escape the trading that goes on within your own firm. >> let's be clear about this, and there has to obviously be speculation. if the hedging is not efficient, if the hedging is flawed then there was speculation. this is culpability on that part if you want to talk about what it prop trade og or not, this is clearly speculation if it wasn't done the right way and in a capacity of hedging. >> mike murphy are you contraryian with this group on these headlines for j.p. morgan? >> it's hard to make a positive out of this for j.p. morgan.

i'd say a company's management that really knows how to handle what's obviously negative news. they got it out in the open. they're on the confers call right now. when the news first broke the stock was down to 6%. it's rallied to being down about 3%. remember this stock was $45, $46. it's pulled back 15%, 20% already. there is value in j.p. morgan. when the dust settles here i am looking at the stock. i am long a very small position. >> i'm long with you, i completely disagree with that. j.p. morgan is not telling us they're out of the position. they're telling us it's a bad position that's losing money. it's a volatile market and we still have the position. the fact that they still have the position doesn't give me any comfort as a shareholder or any incentive to step in and buy more. >> you'd have to have some level. >> absolutely not. not knowing at this point if

they still have the position. that's the problem. >> value's not a catalyst. this is a new risk. valuation is not a catalyst in a market that is falling. at the end of the day they have the rectify the catalyst with a positive catalyst. this stock breaking $41 is a problem. >> being out in front of this thing doesn't get around the fact that there's a situation going on. good for them for being in front of it. that's what the supposed to be doing all along. we shouldn't be championing the efforts of something that shouldn't be going on all along. in the context of the broader market 1340 in the s&p is your bogie. i have no clue where it's going to trade. to the bulls, you didn't get what you were looking for today. it started out great. a lot of steam out of the sails late in the day. we'll see. if it breaks 1340 you need to re-evaluate everything you own. >> 4 is going to be a problem in tomorrow's market if it trades

the way it trades in the afterhours session. >> you remember i was on earlier on in the week you said what did people buy on monday when the stock started to rally off those opening lows and started to rally up. they bought the xlf. they wanted the financials that what people are putting their money in. you see this rotation back out of there. >> it's up the most year te date. >> if you look at earnings energy disappointed, financials everyone was shocked at. they never reached that peak. >> you cannot put this on the tape that you are going to have quote unquote more volatility in your earnings stream when you should be having less. this is a big problem because the financials are up so much. >> that's the problem for the market tomorrow. that's the overall macro head wind for the market is energy is not strong. the industrials are not strong. technology had a terrible day

today. so financials were a source of opportunity so far year to date as steve points out, that's where the money flows in essence were going. that's why it's a problem for tomorrow. kudos to pete and jerry. zero interest in financials right now. >> he's been calling it straight from january to today. >> a happy man right now. i want to go to mary thompson. she's been on the conference call. what's the latest? >> i just want to give you some headlines for a minute. j.p. morgan ceo jamie diamond calling the losses that have been realized in the chief investment office as agreej jous and self-inflicted mistakes that violated the company's standards. i want to walk through them. essentially what the companisies it's going to result in an estimated loss of $8 munn million in its corporate section. not for the corporation as a whole, but within the corporate line in its income statement or balance sheet. within corporate it is a mending

bar which is value at risk. dield called the trades poorly executed and poorly monitored as well. as a result the company has brought in what he said was the top members of its audit teams and a number of other teams to wound down a portfolio which could result -- not wind down in a portfolio, i should say restructure this port foal which could result in about a billion dollars in losses, he said. that will -- that will depend he said on the company's own trades as well as the markets. the decisions he said are decisions and the markets will be critical in this. he also mentioned while this will have no impact on the company's basel one ratio, it will have a negative impact on the basel three bringing it down

to $.82 from $8.4. diamond calling it self-inflicted mistakes. to go back with it to refresh our audience's memory. the chief investment office what it did is the company was taking in deposits and while usually those deposits go to take out loans, it was using the extra money to do a couple of things. to manage interest rate risk but also credit risk for the whole corporation and this is where these problem trades are focused on. managing the company, it's a strategy that diamond called poorly executed and poorly monitored. we'll have more from the call coming up. back to you, melissa. >> it's joe, real quick before you step off just a question on jamie diamond is he guiding in terms of looking forward for the remainder of the year and telling us how long the risk level on this portfolio will be

elevated? >> he didn't say anything specific. as i mentioned earlier the way of measuring risk has almost doubled. could take them to the end of the year so one would assume that the bar could remain elevated for some time. he didn't say it's going to end or it's going to come down in the near future. one other thing that i want to also highlight is he also talked about on a quarter basis if you include the losses that are anticipated in corporate right now they are expected to make about $4 billion in the second quarter. that's what estimates are right now. that would include the anticipated loss of $800 million in the corporate line of $4 billion. they said they're going to give more updates once their second quarter is complete. but again, those are the headlines from the conference call right now. >> it's worth pointing out in the context of what j.p. morgan

basically $100 billion in revenue. you're talking about less than 1% of what they'll do in revenues this year. not that that makes it right. >> no, it doesn't. diamond pointed that out. ectiaid put it in perspective. this chief investment officerme runs a $200 billion portfolio. so the loss there is minimal. it's basically a $2 billion loss on a pretax basis offset by a $1 billion gain on the sale of some of these synthetic credit hedges. but again, it's not something that the company wants to have happen. as he said he was very much concerned that it was not in keeping with the company's standards. it's certainly a black eye for the company. maybe small. >> tstz highly embarrassing just a couple weeks ago they were quoted as saying they were very comfortable with these positions. and they're very long-term in nature. here they are essentially having to figure out how to restructure them to get them off the balance

sheet. >> it's certainly an embarrassment for the company. he was quick to point that out. >> mary, thanks so much. we'll get an update from her a little bit later. the headline egregious, self-inflicted. can you believe j.p. management at this point. we've been touting them as the best in breed bank with the best management team on the street. here we are a couple weeks later a reversal on the cio. >> i just tweeted this. too big to manage. think about it? is it too big to manage. it's a small loss, but is it too big to manage. this is a rogue whale at j.p. morgan you can't have that right now. >> i think you can trust j.p. morgan. i'm a shareholder. i am not going to get out of my position, but i am not going to add to my position. i agree with guy on this when you look at the monetary loss it is relatively small. but it is a black mark for the entire industry. again, i go back to the portfolio itself suggests that there are others that need to

mark to market their book and take some losses as well. it's not just j.p. morgan. >> jamie diamond is saying that he sees more portfolio risk. that the risk could last for another couple of quarters and that they could lose more money. so we'll continue monitoring this call and bring you all the headlines in the meantime we are watching j.p. morgan bring down the financial sector as the whole. the xlf that tracks the financials, let's get the latest. what it could go do to the overall markets. what do you see here? >> financials we're talking about frms last week with the bk x. what we said is risk-reward is not -- not favorable for the financials. what you can see here is it's running into some resistance. what we expect to happen is you can get a pull back in the sector. that's the short-term view. we think financials they've been

a good practical leadership group. i think it's going to give up the leadership status. when you look at the bigger picture pattern for financials it's a base that needs to be completed and we think there's a few more years of base building for the financials. so it's not going to go anywhere for a long time. we will continue to monitor the news out of j.p. morgan. we have an update on the other we have an update on the other side of this break. [ male announcer ] at scottrade, we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning,

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welcome back to fast money. we're continuing to watch the jp morgan story.

want to bring in dr. jay dipping into j. morgan shares on this pull back. why? we lost him. but that's quite a tease. it would be really interesting to hear why. mike at the options desk, did you see anything relating to j.p. morgan during the session do you have any evidence maybe somebody knows something? >> not necessarily in the options. people may recall that a couple days ago dan nathan was talking about seeing a little additional risk in the financials on the credit side and not really seeing it sort of move down to the equity side and wondering why that wasn't the case. one wonders whether people thought there might be some rumors floating around there was going to be some bad news there. one quick point i am interested they were talking about seeing that var number bump up to just under $130 million.

i'd like to know what the confidence interval is on that. value at risk tells you how much you can lose on any given 20 days or 100 days. what we need to know is not just okay it's $130 is it once every 20 days. if it's every 20 days that kind of baump up in risk for the bank overall is a pretty big number. we may go back to before the credit crisis $130 million is where goldman sachs was back then. >> i might be speaking out of turn, but i think my understanding the value of risk is any given day. i think you're talking about any given day they could potentially lose $125 million. >> more specifically double what they had expected. which is unbelievable. we do have dr. jay back on the fast line. why are you buying j.p. morgan shares on the pull back? >> because i think you can buy this one. i think the other guys are going

to try to hedge. they're trying to hedge. i think jamie diamond saw what he saw. when he tole us all i'm not a buyer of my own stock at $45 on the buy back, he was telling us okay, that's a decent level at which i would take profits down here at $39 or $38 in the afterhours i think you buy this stock and you sell either db, cs or gs against it. it's a great trade going into tomorrow. i'll probably be doing more of that tomorrow during the day. >> we're seeing jp morgan afterhour lows down 6.5% as the conference call wears on. jamie diamond he's very direct. he doesn't really try and couch anything. he's saying that things could get worse or they can get better. that is not helping the cause here. how can you determine whether or not you're just trying to catch a falling knife or you're buying

something that will bounce? >> well because i think two things about jamie, when i was in your studios two weeks ago and he came over to me and wrp talking about his quarter and so forth, when off the things that he expressed was he doesn't want to just hedge when he's got exposure. when he deems the exposure is too much, this is a guy that pulls the trigger and gets out. in other words, he'ser w taken pain here. i think that many of the other competitors will try to hemg their way out of this and they will have more exposure on their sheets for longer periods of time. that's why i would sell those like i say, credit swiss, deutsche bank, goldman, i love the traders there. i would sell those they're more likely to hedge their way out of this. jamie is more likely to take thit and move on. that's what he's doing with this announcement. >> here's a quote from jamie diamond on the conference call this is classic jamie diamond.

he says just because we're stupid doesn't mean everyone else was. really admitting that it was a self-inflicted trading mistake. trades were poorly monitored and they're poorly executed. it was j.p. morgan alone. >> i disagree with that. i think it's endemocratic of the system. what happened on wall street is we survived the strom. people are back to doing what they were doing. what's astonishing to me is it comes out this far down. not that i'm a risk portfolio manager, but that is just incredible to me. although doc makes a good point, to me the bigger issue is how does it come out this late in the game. >> it doesn't matter if anyone else took risks or did anything else, it's still going to trade with the overall sector. it doesn't matter what anyone else did, the point is thatment

p. morgan is going to bring the whole entire space down. >> it's the fear of the unknown. >> there is a known here. the volker rule is a credible known factor. and that's why it's on the tape. that's why diamond's trying to refute it. this is why the volker vul in play. it's a political point. there's going to be a presidential debate. i don't think obama or romney want to touch this with a ten foot pole. it's a big problem. >> the biggest problem goes back to the overall market itself. the revelation of this news in a market that is technically teetering on a breakdown is the ultimate problem tomorrow. >> let's see how the story could impact the overall markets. we'll do that after this break. we're on the j.p. morgan conference call. the stock is down more than 6% in the after hours session. much more fast money straight ahead.

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mpb the j.p. morgan conference call is getting heated right now. this as the stock hits afterhours session lows. the analysts are grilling ceo jamie diamond. let's listen to the call. >> we added different types of people, talented people and stuff like that. that is what we're supposed to do. we will manage that portfolio to maximize return for shareholders. and we've been very, very careful. look at all the things we've done. we've been very careful and i think quite successful. this is obviously not in that category. >> okay. thank you. >> i should point out for all the folks on the phone, you can see what people have in those portfolios. you owe to the deposits you buy securities. that's been going on for 100 years in banking. >> to ask a question press star

and then the number one, your -- >> we want to go back to mary thompson for a wrap. we're approaching i believe it be end of the conference call here. take a look at that stock not reacting favorably since the call got underway. >> not at all. i wanted to bring up a couple of highlights from the cult between my last report and now. dimon saying this will not be an issue for the bank. essentially what happened is the company was looking at a new strategy -- put into place a new strategy for its credit hedge. it has a $200 billion portfolio monitored by the chief investment office. it's used primarily to manage interest rate ris, but also credit risk for the whole corporation. they implemented a new strategy to reduce the credit hedge. dimon called it poorly executed and poorly monitored. he said by the end of the year it won't be an issue for it. they do have to restrekture this

port foal yes, which will mean some volatility in its corporate line on the balance sheet. he also said when asked if this would violate the volker rule, a rule that wants banks to end proprietary trading. he said i don't know, i did violate the dimon rule. asked if other banks could see similar losses, keep in mind this was a $2 billion pretax loss, as a result it will mean an tlrs 800 -- roughly an $800 million loss in its corporate line in the second quarter. again, when he was asked could other banks be doing something similar? he said just because we're stupid it doesn't mean that everybody else was. jamie dimon the ceo of j.p. more gon apologizing. he was humble ancon trite. the call is over.

an interesting and disappointing news coming out of that bank which has always prided itself on having a good balance sheet and risk management, et cetera. here there was an obvious failure. >> mary, if i can ask you about some of these losses. you mentioned the $800 million loss approximately on the corporate line. there's also the notion that a team of auditors are going to restrekture this that's going to rul in possibly a million dollars. are these two buckets separate? >> as i understand it, i would like to get clarification. it means an $800 million in the corporate line for the second quarter it could result in a loss of $1 billion through the year. i'm not sure if that meant for corporate through the whole year or in total or in addition to the $800 million. i'm not clear about it. i'd be hesitant to say anything else about it. >> the possible legal losses that is a separate bucket altogether. >> that's separate. again, i'm not clear on that.

i don't think that was any change from any other guidance they gave before hand. i'm not sure on that. i don't want to comment. i apologize. >> it's a breaking story. we're all just trying to wade through these numbers. thanks so much mary thompson for being on that conference call and digesting all of this. the call is over. the stock is still lower in the afterhours session. we're pretty much close to the low on this one down 6.8%. dr. jay said he was going into the afterhours session buying. >> he's been a kamikaze lately. he's buying stuff aggressively. nine times out of ten it's been working for him. he either has a suicide mission or it's going to play out. the average retail investor can't be as quick as dr. jay so be careful. that's the bottom line. we will get the technical take on the overall markets and how this story might impact this story might impact tomorrow's trade straight ahead.

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do the credit markets offer any clues of what was actually going on? let's ask an expert david albright who manages a bond

fund. david, it's a pleasure to have you with us. >> thank you very much. >> were there any signs out there that there was trouble lurking? >> j.p. morgan has traded tight historically. it's trading about 15 basis points wider. we'll take a hard look at wheraluations are tomorrow. not only with jp morgan, but anybody else that was impacted. >> where do you look to next? >> the other financials. obviously brokers, frms some of the banks, some of the large money center banks. we'll take a hard look at the sector. we're on the conference call and evaluating as we speak. >> in terms of the traunch that j.p. morgan was short they're trying to get rid of that, is that a buying opportunity for anybody out there? >> neighbor for some of the distressed buyers. >> do you see any mean reversion risk given how high it's been?

>> it may be an opportunity. we're going to efl, get our arms around it, see what the ultimate exposure is and we'll allocate if we think it's appropriate. >> what's your view -- i know you're not an equity guy per se, you look at it clearly. what's your view on what's going on in the u.s. equity market? >> the equity market has been volatile. it's been immune to a lot of the events that have gone on in europe. some of the areas that we really like are corporate bonds. investment grade corporates have been resilient. the high yield market has been resilient and the loan market has been resilient. we haven't had the same volatility. our market hasn't been suicide susceptible to the headline risk of what's been going on. >> is it too late to get into that high yield corporate bonds. i own personally mhys. it's been great for me, but it's speculative. you have to have a steel stomach for it. but it yields 8% and it's paid

monthly. we favor loans to high yield. it's narrowed in to 150. we've been a better seller of high yield and a buyer of bank loans which represent more value. that will go back to 220. >> okay, david thanks so much for joining us. we appreciate your time. thanks for stopping by. david albright of vert is here. in terms of the afterhours trade on j.p. morgan let's check on that stock one more time as we head to break. we are trading lower. the conference call finished up about ten minutes ago. a heated conference call in which is analysts were grilling jamie dimon pulling out classic jamie dimon phrasing such as i don't know if it's a violation of a volker rule, but it is a violation of the dimon rule. >> one guy that i want handling this as a shareholder it's jamie dimon. >> you do? what's a shareholder you have no

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no surprise decline in the s&p futures here in the afterhours session. it's not just j.p. morgan

hitting the futures. it's also shares of nordstrom. a reporting disappointed first quarter results. ichb toifrs for high and spending was higher than expected. they're raising their sg and a estimate because they anticipate spending john-john line endeavors. let's bring in the ceo and chief research officer of an advisory group to break down the numbers. what do you make of this quarter. it was a miss. can you see any positives here? >> i think basically the online business obviously is a growth area for hem. one of the things they've been advanced by investing that way. but with the comps that they've gotten people wanted to see some leverage on those margins with inventory coming in higher that was the concern, plus any company in retail who's not raising their earnings guidance the company trails down a little bit. we need to continue to see same store sales being very strong for them. >> we watched the dynamic where we saw people move away from the

specialty stores. now we're starting to see a shift there. do you think it's coming back full circle and you and i the last time we discussed this american eagle was trading at $16 now it's at $20. do we see this moving to mid $20s to the $30s? >> i think the doldrums that the specially retailers had been in and way off their peak margins and there's lots of recovery room you're going to continue to see specialty retailers moving hire. the turn around names american eagle or gap people are looking for who's not at their peak levels where we could see some runway and where gross margin pairs are easy. those are those names. department stores have had good comps, they continue to generate solid rurps because of online and because they're getting the product right. but there's more to do in terms of moving the earnings guidance higher. if you don't, then the stock stalls right now. >> macy's was a monster.

when does this get interesting for you? >> it's becoming interesting now. macy's is always conservative with their guidance. my sense is every 25 basis points of leverage gets almost 11 cents a share in epf. there's a lot of room there. and now women's apparel is doing well. i don't see why we're not going to continue to seal solid growth from macy's. >> i've got to leave it there. thanks for your time. joe, what's the trade here? >> i think the trade on this is to determine who is the best positioned in the retail department space because your going to have a tremendous amount of spend in the entire industry over the next couple of quarters. you're going to have apps, google apps, you're going to have to increase your spend on ecommerce who's the best position. for me it is nordstrom.

i think they're the best positioned. >> murphy, the contraryian, are you picking up nordstrom? >> no. i think macy's has been great all year. we're long macy's we're short jc penney and we do not have the chicken little hat on. the sky is not falling. >> more "fast money" coming up next. next. next. [ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪

>> welcome back to fast money. we're live at the nasdaq market site. take a listen at what jamie dimo narks had to say on the j.m. more gon conference call. >> would this be a j.p. morgan specific issue or a chance that others also have some losses on similar positions? >> i don't know. just because we're stupid doesn't mean everybody else was. i have no idea with other people are doing. >> you've got to love jamie dimon. david's been on that conference call the whole time. david, classic jamie dimon shooting from the hip. maybe that's causing more trouble than he would like at this point in the afterhours. >> i think something that's always been admired at least by many of us is how plain spoken mr. dimon is. on every conference calls as you well know, he is in charge of every fact.

along with that well known jous spokenness is his regard for the ability to manage risk and know everything that is going on at that company. this is not some lawyer that we're talking about who's running a big bank. this the jamie dimon always regarded as the finest of ceos offense our big banks. i watched him. i spent plenty of time with him going through every risk position. i've seen him do it at the bank. so the idea that this got away from them a bit and he said it so many times in only the way he could say it, of course, but that a trade got away from them, that the risk they were taken on perhaps and the strategy pursuing with this trading got away from him is really surprising. there's no other way around it. and we'll see what the impact is oin the stock market. certainly a dent to his credibility overall and has got to be a dent to confidence overall when you watch the biggest, best run bank out there taking a hit like this.

>> it shakes one's confidence. david, we'll see you tomorrow. we do want to go to todd. he joins us on the fast line here. when you believe you've invested in the best of breed bank and one of the best of breed management teams in jamie dimon and the rug is being yanked out from underneath you. obviously from the tenure of the call investors and analysts alike were stunned by the admission on the part of jamie and the company. completely unexpected. completely out of character for a company like that that prides itself on a risk management system. that being done is all it does is help the fed's position for the implementation of volker and

what constitutes proprietary trading. it has a negative implication for the rest of the broker dealers. it couldn't come at a worst time at this stage of the rule making process. >> didn't blithe masters a week ago -- i don't know when, didn't she just say they don't take proprietary something like that at j.p. morgan. i'm paraphrasing. she said something that sort of flies in the face of what's going on. >> that's what's so, you know, stunning about the admission from the point that verbatim on the first quarter call they talked about the use of strictly plain vanilla instruments to head the corporation's both interest free risk and credit risk. here we find out that using synthetic instruments hedged the credit risk which is exactly what got us into trouble during the downturn. it's catching everyone completely offguard. >> todd, bottom line, you take a look at the stock down 5.5%. do you try to buy this ting r

thing? >> obviously there's an implicit for the stock in the mid 30s if you will. particularly given the size of their buy back that they have in the back pocket. again, it's a high quality company. you know, it's certainly a plaque eye against the company. there's certainly a floor in the mid 30s, that investors are looking for. >> todd, thank you. >> todd, thank you. we'll be right back. [ donovan ] i hit a wall.

and i thought "i can't do this, it's just too hard." then there was a moment. when i decided to find a way to keep going. go for olympic gold and go to college too. [ male announcer ] every day we help students earn their bachelor's or master's degree for tomorrow's careers. this is your moment. let nothing stand in your way. devry university, proud to support the education of our u.s. olympic team. in your fight against bugs. ortho home defense max. with a new continuous spray wand.

and a fast acting formula. so you can kill bugs inside, and keep bugs out. guaranteed. ortho home defense max. these are the two stories that will impact trading tomorrow. take a look at j.p. morgan chase shares down 5.5%. ceo jamie dimon says it was self-inflicted. take a look at shares of nordstrom. missing wall street estimates by a nickel a share. also saying that it's spending increased, itchtories increased and they're leaving fiscal 2012 unchanged for the year. we are seeing that impact here on the s&p 500 futures which are closed by looking down by about half a per cent right now. meantime sharp left turn here. we want to do some good with the remainder of the time. leukemia and lymphoma society is

hosting the pineapple 5 k on may 19th to support research, education and advocacy for leukemia and lymphoma. we have the president of the society. guys, great to have you with us. bob, i've got to start off with you. being a wall street guy you're exposed to so many charities which you can support. what stood out to you about this one? >> i was asked a few years back to participate in one of the fundraising activities in connecticut. i'm one of the fortunate members of our board that doesn't have a personal connection to a blood cancer. but i got involved. once you see what good the organization does, i just stayed involved and a few years back i got involved in the board and now i'm chapter president. >> can you speak to the training

that's involved. >> with respect to the upcoming pineapple classic it's a 5 k. the obstacle course that is pineapple and hawaiian themed. so training probably you don't have to be an iron man participant. but as i understand you might be. it's open to anybody 8 years of age and older. families participate. groups participate, people get dressed up. it's all for fun and all for raising awareness and money. >> thanks, guys for coming out. we do appreciate it. we're out of time. a very busy show. kevin, bob and brian that race is may 19th. time for the final trade. steve? >> faz, it's a one day play it's levered. don't get stuck many the name. >> big cat farmer, pfizer. >> kevin. >> short capital one. >> joe? >> i bought starbucks today. go in the pineapple. >> i'll eat it after wards. >> that's a warm up for the iron n.