Jamie Dimon is a weird cross between Tony Soprano and Sarah Palin. In a combination political/mock execution tour, he and his consiglieres have boarded a big black bus to roll down the highways and shake down the masses. He is scolding everybody but himself for the financial meltdown and long depression. And, of course, demanding ever more concessions.
He is doing his crony capitalist duty to ram the second coming of the Catfood Commission down your throats. Stop whining that you're in pain just because his bankster mob broke a few of your precious financial bones. If the economy sucks, it's your fault too, people. Stop blaming him, because it makes him the sensitive market lose confidence. And by the way, pay tribute by cutting some entitlement programs, so the rich can get even richer and gain back some of that self-esteem so cruelly taken from them by the selfish underclass.
Dimon, who simultaneously acts as both CEO of JPMorganChase and board member of the NY Fed, (and thus regulates himself) flew to the Midwest on his private corporate jet this week, only to board an armored bus, the better to connect with his minions and customers in the heartland. (He did similar tours in foreclosure-riddled California and Florida last year.) They are a combination of chutzpah, browbeating and damage control. They're a way to connect with folks, and in the proudest godfather tradition, make them an offer they can't refuse. Convince them with a threatening smile that the interests of Wall Street and Main Street intertwine. Physically ingratiate yourself into their geographical space.
Dimon's exact itinerary has been kept very much on the QT, and his folksy meetings with customers and wage slaves have been closed to the media. But Mark Williams of the Columbus (Ohio) Post-Dispatch somehow managed to infiltrate one of the Chase road-shows to listen to Dimon's shrill, finger-pointing harangue:
"It’s because of us. We scapegoat each other. We point fingers,” Jamie Dimon said yesterday while visiting with customers of the bank’s Kingsdale office in Upper Arlington, as well as the branch’s current and former employees.
And shades of John McCain's infamous 2008 remark that the "fundamentals of our economy are strong" and Barack Obama's infamous 2012 gaffe that "the private sector is doing fine":
I actually think the underlying economy is not bad,” Dimon told about 200 people gathered in a tent set up next to the branch.
Consumers and small and large businesses have healthier balance sheets than before the recession, he said.
“I can’t prove it in real time,” Dimon said of his thesis.
But Dimon pointed to last summer’s debate in Washington over raising the debt ceiling and critical comments made of banks and other businesses as examples of how such episodes sap the confidence of consumers and businesses to invest and expand.
“We’ve done it to ourselves,” he said. “I just hope something breaks the back of this political environment.”
Hear that, peons? You and Jamie are in the same cozy little club and you did it to yourselves by buying a subprime-mortgaged house and using one of his usurious credit cards. If you want him and his corporatists to stop hoarding their obscene profits, you have to pay him back, with interest compounded hourly and ad infinitum. You have to give up your Social Security cost of living increases and wait till you're 70 to retire while they foreclose your underwater homes. That's the cudgel that will break your environmental back.
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Of course, there is another practical reason that Dimon is venturing into the heartland: Market share. JPMC is only Number Four in market share in the midwest. There are scads of small bankers in flyover country just waiting to be sucked up in the voracious Wall Street maw. From a Milwaukee Sentinel pre-show interview:
Dimon insisted that even for a megabank with $2.3 trillion in assets, a market such as Wisconsin is important.
"We contribute $1.5 million in philanthropy in the state, a lot of which is in Milwaukee," he said. "We make community development loans. We bank some of the bigger companies - like we're one of the banks to Harley-Davidson. So we really bring a lot, even though we're not local the way you think of a local bank."
And, echoing the mantra of Bain-style vulture capitalism:
"We want to make customers happy. So if they don't do a good job integrating and bringing their products and services to Milwaukee, yeah, it will give us an opportunity," Dimon said. "I don't wish for other companies to fail. But, of course, if they're not good at what they do, we'll win share."
Charity, motorcycles and corporate raiders -- what a way to win heartland hearts and minds, eh Jamie? John Gotti, the teflon don, used to give neighborhood street parties in between hits, too. Anyway, the new Dodd-Frank rules are way too cumbersome for the itty-bitty community banks to handle, so it's much better to let the mega-banks just eat them for lunch:
"Unfortunately, I think a lot of the new rules make it very tough for community banks," Dimon said "We're one of the biggest bankers to banks, including community banks. I think it will be easier for some of the big firms to accommodate all these new rules and regulations and capital. So in spite of the fact that they said they'd try to favor small banks in all this legislation, the law of unintended consequences usually means that's not what happens."
And he makes sure to blend some sweet rah-rah patriotism into the arsenic to make it easier for the doomed local economies to swallow. This guy deserves the gold medal for Bullshit Artist of the Year:
The underpinning of the American economy is actually quite good, and I wish our politicians would say what I'm about to say," Dimon said. "We have the best military, the best universities, the best businesses, the best capital markets - the widest, deepest, most transparent, even though we've had some problems in it. . . . Consumers are in far better shape than they were in. Corporations large and small are in far better shape. We've got a pretty good hand."
You can say that again, Jamie. You got dealt an exceedingly good hand, with nary a slap on the wrist from your political cronies in Congress and the DOJ for that unexplained "loss" of $5 billion or $9 billion in the London Whale deal.
You and your Wall Street mob are not content to simply throw us under the bus. You get on the bus, and you run us over, again and again and again.
I'm not a voyeur, so I couldn't bear to watch the public orgy known as the Dimon-Senate Banking Committee hearing writhe its way to completion yesterday. I'll paraphrase what I did watch, with one hand over my eyes:
Dimon: (sounding kind of like James Cagney in one of his gangster roles, talking rapid-fire oligarchy-barky Brooklynese with a mouth full of gravel)."Sorry, so glibly sorry. But I am so huge that even a glitch like a $4 billion loss doesn't put a dent in my greatness. Yeah, yeah we might need a few regulations, but let me do the regulating, guys. I'm just too big for most people to even understand. But I got it covered, see?"
Senators: "Okay, Your Greatness. Would you like some taxpayer-funded champagne to go with your caviar? Are the camera lights creating a drop of perfumed perspiration on your lofty brow? Would you like to retire to a special room where we can enjoy our make-out session in private?"
Senator Bernie Sanders, the socialist-independent senator of Vermont, was very much a part of Wednesday's hearing although he is not an actual member of the Committee. Protesters screamed at Dimon to listen to Bernie before they were escorted out by security guards. Dimon, busy schmoozing with his gentle inquisitors, appeared unruffled by the outbreak of hoi polloi-dom. He is triply safe. He is in charge of a bank the size of a country, he serves on the regulatory board overseeing himself, and he funds the campaigns of almost every senator on the Banking Committee. He is a ranking member of the Board of Directors of the United States of America.
Sanders has just named names in a report by the Government Accountability Office, showing that Dimon is not the only member of the Federal Reserve Board who is a fox guarding the henhouse. Since the 2008 financial meltdown, The Fed gave trillions of dollars in no/low interest loans to Dimon's bank and 17 other corporations whose CEOs also just happened to have seats on the Fed.
JP Morgan, Dimon's bank, received $390 billion in emergency Fed funds at the same time his bank was used by the Fed as a clearinghouse for emergency lending programs. Jamie Dimon's Fed gave Jamie Dimon $29 billion in financing to buy distressed investment house Bear Stearns in March 2008 after it allowed Jamie's bank to cook the books and erase Bear Stearns' risky mortgage related assests from the balance sheet. Jamie Dimon's Fed gave Jamie Dimon's bank an 18- month exemption from risk-based leverage and capital requirements. (It gave carte blanche to recklessness. It ensured that Jamie Dimon's bank would grow too big to fail, that Jamie Dimon could risk other people's money with impunity and into perpetuity.)
The GAO report says all this chicanery sure does give the "appearance" of impropriety. Ya think? They probably should have called it "Public Enemies" to give it a little more pizzazz.
Sanders, meanwhile, has introduced quixotic legislation that would try to bar banking and corporate CEOs like Jeffrey Immelt of GE from serving on the Fed board. The names of the other plutocrats who profited from their dual positions can be found here.
Meanwhile, the great Crony Capitalism World spins, a magical place where all the risks are subsidized and all the gains are privatized. The dirty rats remain at the helm of the sinking ship.
I haven't written about the JPMorgan Chase $2 billion debacle till now, for two reasons. First, Mothers Day and Jamie Dimon don't mix. It was really in poor taste to put this guy on TV yesterday -- when you think of Dimon and mother, it's not the word "day" that comes after his name. (I kinda stole that from Obama's quip about Rahm Emanuel.)
Second of all, I understand bupkis about the machinations of the financial industry. But that's the whole point, right? The bankster class, with its credit default swaps, proprietary trading, tranches and myriad arcana, likes it that way. The public has no idea what they're doing. Of course, the bankers probably don't either. But they possess things the non-psychopathic segment of the population does not: greed without guilt, reckless risk-taking, a grandiose sense of entitlement, government welfare in the form of endless no-interest loans from the taxpayer-funded Fed which they then relend to the public for their private profit .... And better still, little to no government regulations reining them in. And best of all, the revolving door between Wall Street and Washington that ensures that bankers will continue to own and control the entire country. And bestest of all, either no new laws criminalizing their bad behavior, or no enforcement of the laws already on the books.
For everybody else wondering why we should be mad at Jamie Dimon and his banking behemoth, here is an "Explainer" from Heidi Moore.
In his column today Paul Krugman calls for more banking regulations, while of course expecting no such thing to actually happen. Banker wankers have big egos and tiny memories and little to no capacity for self-reflection:
What did JPMorgan actually do? As far as we can tell, it used the market for derivatives — complex financial instruments — to make a huge bet on the safety of corporate debt, something like the bets that the insurer A.I.G. made on housing debt a few years ago. The key point is not that the bet went bad; it is that institutions playing a key role in the financial system have no business making such bets, least of all when those institutions are backed by taxpayer guarantees.
For the moment Mr. Dimon seems chastened, even admitting that maybe the proponents of stronger regulation have a point. It probably won’t last; I expect Wall Street to be back to its usual arrogance within weeks if not days.
Yeah, and don't expect the Obama Administration to suddenly jump up and demand reform either. This was my comment in response to Krugman:
Last month, Treasury Secretary Timothy Geithner cavalierly announced in a speech that "you can't legislate away stupidity and greed and risk-taking and recklessness."
Well, actually you can. And the outrageous fact is that nobody in a position of responsibility even tried to untangle the devil knot that binds the mega-banks and government together.
I was actually pretty surprised to learn that Dimon is not only chief of his bank, he's also a chairman at the N.Y. Fed. How did that even happen? The foxes are guarding henhouses every place you look. They continue to steal our eggs with impunity. No new laws, no prosecutions, barely a few slaps on a few plutocratic wrists. No banker left behind.
The revolving doors between Washington and Wall Street continue to spin. They need to be slammed shut, pronto. Three years ago, people were too stunned to realize what was going on when the economy crashed all around them and they lost everything. Now, thanks to a plethora of books and articles and documentaries and the Occupy movement, the public is all too aware of the stupidity, greed, risk-taking and corruption.
Forget the watered-down, delayed, and defanged Dodd-Frank Act. As others have suggested, it's long past time to bring back Glass-Steagall. It worked for half a century once, it can work for another half a century again.
Just to clarify, Dimon is a director of the Class A board at the New York Fed, and the chairman and CEO of the bank itself. I had initially misread the N.Y. Fed listings and mixed up his various titles. But in any case, it essentially makes for a triple conflict of interest. (h/t to reader Bilal, who shared the above linked chart explaining the hierarchy.) Dimon serves in an advisory capacity at the Fed, elected by and representing his fellow bankers only. But make no mistake -- he wields an extraordinary amount of influence in the economic and government sectors. Elizabeth Warren wants him gone now. As far as I can tell, she is the only politician calling for his head. Or even for just a portion of his head. That speaks volumes on how soon we're going to see a stampede of politicians champing at the bit to reinstate Glass-Steagall.
