WE SHOULD ALL FEEL BAD FOR JAMIE DIMON
Jamie Dimon is upset. And rightfully so. After all, his bank was saved from the brink of disaster in 2008. The US government took extraordinary measures to ensure that he did not go down as one of the greatest bank failures of all-time. In fact, the US government did him a huge favor by making his bank the linchpin in the US economy. Of course, this was done by making Mr. Dimon’s already too big to fail bank too bigger to fail. But none of this is enough. Saving someone’s career and ensuring that their bank is now an instrumental portion of the US economy is not enough. And in a fit of rage Mr. Dimon went and rewarded himself with a monstrous $16MM pay package last year. After all, he deserved it.
But this is not enough. It’s not enough to pay yourself outrageous sums of money when your company should be in a hole in the ground. It’s not enough to have the government by the throat and know that the taxpayers can never let your company fail. It’s not enough to have been a key player in helping the US banking system become the gigantic leach on the world’s largest economy. It’s not enough that you help pull our best and brightest minds out of productive fields and into finance where they will do nothing but think of new ways to help separate the middle class from their savings. It’s not enough that you helped build a banking system that nearly crashed a $15 trillion economy.
No none of this is enough. And when we pass an incredibly weak regulatory bill that does nothing to actually fix what caused the crisis you go and complain that the government is doing too much. Well, you’re right. The government did do too much. The government should have let you and your friends fail. They should have let you become the poster child of the greatest banking collapse in the history of the world. But you know what? They didn’t do that. They saved you. They saved your career. They saved your reputation. And they saved your precious multi-million dollar income. So, rather than complain that the government has done too much why don’t you just say thank you for what they did do, take a seat in the back of the room, thank your lucky stars and shut up.
Source: CNBC
Cullen Roche
Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.
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79 Comments
the best regulation for any business is bankruptcy court, just like lehman did. Now every banker is a smart ass asserting anything he wants. looking back, Paulson did what he should, for his former company. Others just bunch of BS.
Amen! Send a copy to Jamie – better yet, have a plaque prepared, frame it, then send it – I will gladly contribute to a fund to have such a plaque prepared!
It’s not too late to send Dimon on jail. In a serious country he should be there.
As an economist,I can tell you: no theory affirms that a bank must be big.
Most economists think exactly the contrary.
NICE!!!
I recently found TPC via another bloggers links, and I have thoroughly enjoyed it.
That noted, a couple of observations. First, on what planet would JPM have failed in the crisis? And second, while TPC tends to be *ahem* pragmatic, why occasionally delve into hyperbole? Don’t we have Zerohedge for that if/when one needs it?
Checkmarks:
Cullen is usually reserved in his comments. However, he is a commentator, not a news anchor, and we expect him to hyperventilate occassionally. I found myself admiring his restraint (mentally inserting a few profanities of my choosing), as I read the article, considering his essential viewpoint that the banks need to be chopped down to a reasonable portion of our economy.
Maybe they’ll post his rant over at Zero Hedge!
So, we still have to ask, “What is to be done?”
Checkmarks- Welcome to TPC. I thinks you’ll make a fine addition to the family.
JPM would have failed.
I think you covered it Cullen.
What incredible balls this man has to ask someone else if they had considered the effect of all the actions that were being taken. How did he do in 07 08 09 ? And we bail him out and charges the American taxpayer. Then he gets to borrow money at < .25% and lends it out for 3,4,5,6 or more % Then they pay him huge bucks for this. A half bright chimp could do this. The smart thing he has done is Purchase Congress and the Executive Branch.
Put these arrogant Wall Street banksters in their place. Reenact Glass Steagall; break up the TBTFs; reinstitute leverage caps; undo the deregulatory damage done in 1999-2005.
Banks create money; banking is a franchise from the sovereign. Banking ought to be regulated like a public utility. Let the Wall Street investment bankers take their risks and fail when they go too far; keep traditional banking separate from Wall Street risk and arrogance. Deregulation is very positive for private industry, but banking isn’t a private industry in the USA and hasn’t been since 1913.
a+ nice rant!
Rancher from SD
My great grandfather was a banker who went belly up in the Depression. When I was a little kid, my father taught me bankers were no damn good. He insisted you should save your pity, love, and help for animals. The past 75 years has proven him correct. Jamie Dimon will get his due!
Kill all the bankers. Let God sort ‘em out.
I hope the Republican candidates have the balls to call these insults to our public honor when the debates with Obama come around.
The big banks might be too big to fail, but they aren’t too big to be nationalised…
Actually, the way I remember it.. is that J.P. Morgan saw the real estate market collapse coming and got mostly out of the way. During the crisis, J.P. Morgan was in good shape and was “asked” by the FEDs to take over Bear Stearns! This is NOT something that J.P. Morgan wanted to do, but at the insistence of and with the assistance of the FEDS, J.P. did it. Therefore, the FED funds funneled into J.P. Morgan were attached to their taking over the Bear Stearns problem. Therefore, of ALL the bankers to pick on, I think you picked exactly the wrong one!
No one is TOO BIG TO FAIL, that is a lie! I promise, there is a paddle big enough for everyone’s butt, if we had a FREE market! And if we had a FREE market, there would be someone to pick up the pieces, besides your grand kids!!!!!
After reading through the long list of comments and being amazed at the incredibly inaccurate statements about Jamie Dimon and JPM, it was a breath of fresh air to read “innertraders” comments. It seems he/she is the only participant that actually knows what he’s talking about. Without a doubt there were a number of poorly managed banks that contributed to the current economic mess, however, if you truly study the events leading up to all this, the enabling environment was created by the very government which you are saying should exercise greater regulation over the banking industry. Fannie Mae, Freddie Mac and the Community Reinvestment Act are just a few government creations which aided, encouraged and even pushed banks to make high risk loans which never should have been made…but were politically popular. As for J. Dimon and JPM, while I’m not a fan of big banks and overpaid CEOs, as “innertrader” stated, under Dimon’s management, JPM was one of the very few more conservative big banks which didn’t need bailed out and had built a strong enough balance sheet that they could purchase Bear Stearns when approached with the Fed’s deal.
Oh please. JPM got a $30B guarantee to buy BSC. It’s a crock of shit to say that they did some noble thing. They bent the US tsy over a desk and got a deal on a silver platter.
I don’t deny that some of the govt regulations are misguided, but we could have avoided this whole crisis with a few simple rules in place. Force collateral on OTC derivatives and require more strict collateral rules on home purchases. But the banks have broken down all of these barriers over the years because it was hurting their business model. Did the govt exacerbate the crisis with many of these housing programs over the years? Sure. But who do you think was lobbying for many of the programs that made lending more lax? That’s right – the bank lobbyists.
If you can’t see that then you’re just flat out blind.
Fed Reserve/Banking System = Insane Asylum run by its patients, i.e. Big Bennie B., Big BarackO., Geither, and Co.
Can I get and AMEN brother?
Lets dispatch this Dimon back to hell where he belongs – if the Gubbermint won’t let his bank fail….THEN WE MUST MAKE IT HAPPEN.
Buy silver – crash JPM.
“If you can’t see that then you’re just flat out blind.”
Right, or…..biased
Nice thoughts Cullen. Far more reserved than my initial reaction. I notice that the “JPM didn’t need a bailout; they only took the money because Treasury begged them to” meme is still floating around. Apparently the concept of counterparty risk remains foreign to many.
Lets not forget about old Bernie Madoff folks … The trustee is suing JP Morgan for 6.2 Billion. The trustee is claiming they knew up to two years in advance that it was a PONZI SCHEME He wants the 1 billion in FEES they collected and 5.2 in punitive damages. Is ther any wonder little Jamie is ranting about regulation… If there is any justice he and many other to big to fail Turd Bankers will be warming the cell next to old Bernie
I agree with most of the comments but Chase was one of the banks that was actually making money when they were forced to take bailout money. There were a handful of profitable banks that were also forced to take bailout money. That was so the general public wouldn’t be aware of the ones that were actually failing and take their money out, thus insuring their failure.