MIS 0855 Chapter Notes - Chapter 7.1: Jpmorgan Chase, 2012 Jpmorgan Chase Trading Loss, Mf Global
23 May 2018
School
Department
Course
Professor
Da Excel! How the Most Iportat Software Applicatio of All Tie is ‘uiig the World Gadel
• Kenneth Rogoff
o While easurig the aout of this outr’s det, Rogoff ad Reihart foud a odig
error that excluded the first 5 countries of their dataset
• London Whale
o JPMorgan Chase trading loss
o Eel odel as supposed to oitor ad liit the aout of risk the ak’s Lodo
traders were taking
o Risk officers believed the credit derivatives bets were half as risky as they actually were
• MF Global
o Cosultats hired fir deteried it eeded to iproe the ed user oputer
tools suh as Eel spreadsheets
o Used to oitor risk ad ho uh oe it had i its ustoers’ aouts
o Used to ake sure that soe of that oe did’t ed up i the CEO’s account
o Upgrades never made
• Barclays purchase of Lehman Brothers
o Makers of spreadsheet hid, rather than deleted, nearly 200 cells
o When Excel file was converted into a PDF and sent to bankruptcy court, hidden parts
reappeared
o British bank and Lehman Barclays forced to swallow losses on an additional 179 toxic
deals it never intended to buy
• Utah
o Misalulatio i Utah’s offie of eduatio uderstated the uer of studets ho
ould eroll i the state’s puli shools ad led to a $25 illio udget shortfall
• Fannie Mae
o Error in spreadsheet made Fannie look $1.3 billion more profitable than it actually was
• Native Americans
o Tribe of Native Americans entered the wrong row into the cell of the spreadsheet that
contained the formula to compute the net present value of the Island of Manhattan
(worth only $24)
o Just kidding, the error was made in Lotus
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