You have to give credit to John Hempton, who continues to hammer away at Sheila Bair's seizure of Wamu and the giveaway to JPMorgan (JPM). Hempdon (who did lose money in the move) is convinced that the whole thing was a sham, purposely done to bail out JPMorgan at the expense of WaMu shareholders, and that it was the cardinal error of the government's handling of the crisis last fall.

For what it's worth, this idea hasn't gotten much traction, except with angry Wamu shareholders.

Now Hempton's got another interesting nugget in his arsenal following the release of the stress tests. He notes that when WaMu was sold to JPMorgan, it was expected that in an extreme scenario, there were $54 billion more in losses coming from the end of 2007. At that point, an "extreme" scenario was unemployment around 8%. The losses were entirely from WaMu's mortgage portfolio.

Now the bank lost $8 billion in 2008, leaving potentially $46 billion more in losses. Again, probably more if the 8% unemployment was considered extreme at the time of the seizure.

But, in the stress test that was just revealed, JPM's own mortgage portfolio -- which now should include all the WaMu losses -- only includes $39 billion in remaining mortgage losses, and these are when the stress tests are looking much worse.

This leaves two possibilities. One is that the stress tests are a sham and are dramatically underestimating the losses, in which case JPM, the rest of the banks and the regulators who oversaw the whole process are participating in a sham. Or, the original seizure was purposely based on faulty assumptions, causing WaMu shareholders to get ripped off.