JP Morgan Executive Resigns, Replaced By $4.8 Billion Loser

JP Morgan executive Ina Drew has taken the fall for last week's $2 billion loss at the investment bank. He has been replaced by Matt Zames, previously a trader at LTCM.

Matt Zames is the 41 year old co-head of fixed income at JP Morgan investment bank, and head of capital markets at the mortgage bank.

As the new CIO, he will continue manage mortgages, but he will also be placed in charge of $70 TRILLION of derivatives contracts.

Prior to joining JP Morgan, Zames worked for Credit Suisse, and before that, he was a trader at Long Term Asset Management (LTCM), the hedge fund which collapsed in 1998 after a $4.8 billion loss.

Matt Zames benefited admirably through the JP Morgan emergency buyout of Bear Stearns following the collapse of Lehman Brothers. It remains to be seen if that was a good deal for JP Morgan or not.

What could possibly go wrong?

LTCM collapse in 1998