FYI, the email i sent to Nowlan.
---------------------- Forwarded by Jeffrey A Shankman/HOU/ECT on 09/21/2000
10:01 AM ---------------------------

From: Jeffrey A Shankman 09/21/2000 09:35 AM

To: John L Nowlan/HOU/ECT@ECT
cc:
Subject:

John,

you and I have spoken of this issue before, and I hope you understand how
important this is now. I understand
about the endemic risk from J Block, etc. but I need details on how much
those portfolios add to our var.
Last night you guys blew var by 3.1 million by adding 4.7 million var. As a
result, I am not prepared to go to the board and ask for more.
The best way to approach this problem is by managing the var and making sure
we have no violations, coming up with detailed reports
indicating exposure by product and trader, etc. While we have been working
on this with Brent Price, we are not there yet.

A violation like this one today after our string of many is particularly
troubling, esp since we are not keeping the money made over the last two
weeks. The MTD P&L, being reported as a little over one million this month
doesn't help us really.

I am now going to give out specific position limits to certain traders who
have had big var swings without the resultant P&L.