Second quarter turns out miserable for JPMorgan

$1.5 billion write-off on mortgage-backed securities and loans were taken by J.P. Morgan Chase in the third quarter while the second quarter showed reduced earnings.

"Trading conditions have substantially deteriorated versus the second quarter," stated the officials of the company.

After the disclosure the company stocks fell $3.97, or 9.5%, to $37.92.

According to unnamed sources cited by Financial Times Merrill Lynch's decision to sell mortgage-backed securities at 22 cents on the dollar to Lone Star prompted a fall in the prices of similar securities.