2012-07-12 — seekingalpha.com
It seems abundantly clear that the CIO desk switched to the 'new' [Value at Risk] model because they knew they would need lower readings to attempt to trade their way out of a mess. The 'new' model gave them half the VaR readings of the old model, and thus allowed the Whale Trade to continue without raising any red flags (for a while).
This is an important part of the story for JPMorgan shareholders, as it shows that the firm most likely switched to a different risk model when the situation began to escalate rather than take the escalation as a sign to be prudent, cut losses, and unwind
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