Since the various cases of criminal financial positions

[tanjimajuha20]

Everyone who follows economic and financial news closely or from afar hears truths and of course untruths, as well as misinterpretations about everything related to financial markets. The subprime crisis in 2008 amplified and/or renewed the recurring criticisms about market activities and in particular trading. A new terminology even appeared: " Toxic Products ". The die was cast...



worldwide that were widely skype database publicized (the London Whale Bruno Iksil at JP Morgan, Fabrice Tourre at Goldman Sachs in New York, Jérôme Kerviel at Société Générale in Paris discovered on January 18, 2008), a salutary tightening of control and compliance procedures has been put in place since then. Indeed, the twists and turns of the Kerviel/Société Générale trial are still relevant (with the key being a net loss of nearly 5 billion euros linked to open and uncovered positions ranging from 50 to 80 billion euros and this for nearly 3 years between 2005 and 2008.



The question is whether in 2021, this major industrial accident linked to the criminal behavior of an individual could still occur. Since then, Blockchain technology has emerged and will make it possible to prevent an individual (or a group of individuals) from being able to hide criminal operations on the financial markets, particularly with an excess of the authorized positions of the lines: Let us recall that Jérôme Kerviel's excess level was 1,500 times the authorized positions, which is monumental!



But let's go back to the chronology of the facts and comment on them with the reading grid of 2021. Jérôme Kerviel, born in 1977, was, from 2005 to 2008, a Delta One Trader at Société Générale in Paris. That is to say, he takes firm positions (not optional) on spot assets arbitraged (i.e. covered) with futures contracts in such a way that all the positions taken by this trader are never exposed to the risk of market movements (upwards or downwards). The remuneration for this so-called Delta One activity comes from the evolution of the carry or the backwardation (i.e. the evolution of the difference between spot prices and futures prices). However, it turned out that most of these hedging operations were fictitious, while the Bank's risk control considered that he was actually covered. Thus, this dishonest trader is the major player in the losses of Société Générale