Loki 2

I've worked on the translation of the discription of Loki a bit more today and this is nearly word for word for the original Icelandic (circa 1220 A.D.):

"Loki is fine and fair to see, bad by nature, very shifty in manner. He has that wisdom beyond advanced, but [it] is called sleight, and devices for all things; he would bring the Æsir even into a complete morass and often he would free them with fabrications."

"Loki er fríður og fagur sýnum, illur í skaplyndi, mjög fjölbreytinn að háttum. Hann hafði þá speki umfram aðra menn er slægð heitir og vélar til allra hluta. Hann kom ásum jafnan í fullt vandræði, og oft leysti hann þá með vélræðum." -GYLFAGINNING 33

There seems to be some wordplay going on in the Icelandic.

So, Loki was a magician and a prankster and there is an implication that he was as changable as the weather.