JPM reported better than expected earnings this morning,,,making $25.8 Billion for the 1st Quarter. Maybe a) they are not as short anymore as traders assumed or b) they have hedged those futures shorts via forward cash contracts and other derivatives (ie exchange traded options). Either way they dont appear to be going broke.....
I was reading this as well and knew that there must be a back story so I ran into this article:
JP Morgan Q1 2011
Q1 2011 versus Q1 2010 shows sales declining 8.8% and net income before provisions down an even larger 20.1%. Bottom line the bank’s ability to absorb future losses is deteriorating.
It seems to me they're doing exactly what our government is, living for the short term and casting all long term problems aside. With the second round of adjustable rate mortgages resetting were going to see even more stress on JPM. But like I said, a siler default doesn't mean that JPM will go bankrupt, just incur billions of dollars in losses as it will have to buy silver on the open market.