Piling on JPMorganChase
Jamie Dimon and his many admiring shareholders may well be wishing that he had kept his head down as regulation and heavy handed government intervention did not seem to be well done in 2009 and 2010. Lloyd Blankfein turned himself into Big Bird after one big run-in with the government. Dimon continued to speak his mind, and now he and the firm are a target in vitually every government investigation.
Many people who read his lengthy self-penned annual report shareholder's letters and who listen to his comments would agree that he is talented, articulate and has well thought out points, even if they do not agree with all of them. That said, by being the most outspoken big banker he would not win any points with all of the rigid regulators and many politicians, and they would get him back.
The first try failed. Irving Picard sued JPM for $20 billion to repay Madoff investors. It was a ludicrous case based on JPM having what were essentially Madoff's checking accounts, and the most highly respected jurist in New York Federal Court, Jed Rakoff, threw the case out saying it was without any legal merit.
In the second major event that no doubt has the trial bar licking its chops, JPM took a howitzer and blew off their own foot. That's the recent huge failed hedging trade, and others in that particular derivatives trading market are extracting a huge price to provide the liquidity for JPM to unwind. As they say, hedging markets are a good thing but NEVER become the market. Traders are feasting on JPM's mistake, making money and having fun.
Now it is said that U.S. is investigating JPM, Citi, and BofA for the same type of Libor market manipulation that Barclays bank has been charged with. Could it be true. In a bank as large as JPM, where there is a will there is a way from the present administrations point of view, and it is highly possible that a trader or two in these huge banks acted inappropriately but it is also highly unlikely that it would have been the trading divisions strategy.
In the last day FERC, the government energy regulator, announced that it was investigating the company for manipulating energy markets in California and the Midwest. It was unclear whether there is any basis for this claim, but when this government takes up an investigation the attitude toward corporates is now definitely guilty until proven innocent.
To Jamie and JPM shareholders, it seems that it's payback time. JPM has been so well run overall that it is a wonderful target for the regulators and the trial bar. They have the capital(money) to pay big fines or settle, as in pay a bribe, to get through all of this. It's getting ugly and here it is the sincere hope that the Obama admistration's real goal is not really to drive Dimon out of the business.
Many people who read his lengthy self-penned annual report shareholder's letters and who listen to his comments would agree that he is talented, articulate and has well thought out points, even if they do not agree with all of them. That said, by being the most outspoken big banker he would not win any points with all of the rigid regulators and many politicians, and they would get him back.
The first try failed. Irving Picard sued JPM for $20 billion to repay Madoff investors. It was a ludicrous case based on JPM having what were essentially Madoff's checking accounts, and the most highly respected jurist in New York Federal Court, Jed Rakoff, threw the case out saying it was without any legal merit.
In the second major event that no doubt has the trial bar licking its chops, JPM took a howitzer and blew off their own foot. That's the recent huge failed hedging trade, and others in that particular derivatives trading market are extracting a huge price to provide the liquidity for JPM to unwind. As they say, hedging markets are a good thing but NEVER become the market. Traders are feasting on JPM's mistake, making money and having fun.
Now it is said that U.S. is investigating JPM, Citi, and BofA for the same type of Libor market manipulation that Barclays bank has been charged with. Could it be true. In a bank as large as JPM, where there is a will there is a way from the present administrations point of view, and it is highly possible that a trader or two in these huge banks acted inappropriately but it is also highly unlikely that it would have been the trading divisions strategy.
In the last day FERC, the government energy regulator, announced that it was investigating the company for manipulating energy markets in California and the Midwest. It was unclear whether there is any basis for this claim, but when this government takes up an investigation the attitude toward corporates is now definitely guilty until proven innocent.
To Jamie and JPM shareholders, it seems that it's payback time. JPM has been so well run overall that it is a wonderful target for the regulators and the trial bar. They have the capital(money) to pay big fines or settle, as in pay a bribe, to get through all of this. It's getting ugly and here it is the sincere hope that the Obama admistration's real goal is not really to drive Dimon out of the business.
posted by John Borden at 5:42 PM
3 Comments:
Add asset management to this mix as the SEC is now singling JPM out for supposedly selling its mutual funds to the exclusion of others and not providing full disclosure. It looks like the work of disgruntled ex-employees but the Feds are interested in any way to besmirch the mgmt. Dimon, as you say.
Behind that sunny upbeat outward personna, Obama is a ruthless politician. Dimon crossed him and he will not let up, meaning his SEC commissioner, commodity regulators, and Attorney General's office will look for any way to attack JPM.
While undecided about the presidential election, Obama's campaign is becoming increasingly embarrassing as he distorts "facts" constantly while offering no vision for the future
Obama scares me. I'm not sure why. Is it the fact that he owns the Attorney General's office the way that Nixon did. Is it a campaign style that ignores the facts. I would like to vote for Obama in some ways, but I don't want to be part of some type of vigilante anti business coup. Is that what he is all about.
Romney is really weak. He is a fabrication. Weak may be good.
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