Bankers JP Morgan shocked the market on Thursday evening with its disclosure that it had made a net loss in the past six weeks of $800m as a result of $2bn of trading losses.

On Friday the company's shares plunged 9% and its credit rating was downgraded by one ratings agency. Chris Orndorff, a fund manager at Western Asset Management in California, explains his view that the problems were caused by failures in Morgan's risk management structures.

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