Business as usual, at JPJ Morgan Chase, and Wall Street!

What a shocker to hear of the monster $2B  trading loss recently by JPMorgan Chase et al? Not. Most of these people barely got a slap on the wrist by Obama, as per Tim Geithner's wishes, when the financial sector collapsed a few years ago. While that strategy may partly be seen as having provided a degree of (apparent) stability at a very shaky time, it continues to pervade the financial sector today in that shameless greed and the ravenous desire to make more money by such types is undersigned and underwritten by the US government itself. We all heard that derivatives and credit default swaps were supposed to be financial instruments that were now to be looked at like upside down crosses, and not the tools on which to place unnecessary risk, so why did the normally conservative JPMorgan empire allow such a massive exposure to toxic assets and risk, again?

It seems that we are supposed to be thrilled that for once, heads are going to roll, and the first to go has already been canned: their Chief Investment Officer (CIO), one of the most powerful women on Wall Street. Well, it only seems fair and proper in some ways, I mean, how can you be called an "investment" officer, when you just repeated past mistakes and incurred a multibillion dollar loss? Damage control also seems to fall very heavily on the side of media-friendly Jamie Dimon (CEO), who one and all appear to see as the man who is sorting it all out. Yet, he is the BOSS. By default, he authorized such "investments". Additionally, mere weeks ago, he said that he stood by his CIO and their recent transactions, and that time would prove them all right. Not. Again. 

It is always the same with such types and with Wall Street in general. When it goes well, we don't hear too much about it, other than the occasional outcry at massive sums of money being handed over in bonuses. But it's your retirement fund or my insurance company that also got boosted, so, fine. Then when disgrace occurs, well, it's all part of doing business, and Obama et al. tell us it's okay, and we disown this or deny that, wait for the hue and cry to die down, and then we get back to business as normal. It's all in a day's work, on Wall Street. But Jamie Dimon, as capable a banker as everyone seems to claim that he is, is the boss, and has too much power: that is the problem. For sure, the roles of CEO and Chairman should be split at an institution the size of JPMorgan. It is not in their interest to have one person in control of all of it, who then basically turns around and says it is too much for one person to oversee, as his excuse for a monstrous loss in the billions. Additionally, we need to see that he forces through clawback clauses in rogue executive contracts, and takes back the bonuses already paid to these people, who have just cost them billions. He may be popular, today, but if he doesn't appear to take this as seriously as it merits, the cries for his own demise will get louder and louder, and we think that's exactly how it should be. 

Greed is one thing, but greed that is so overboard that it becomes incompetence by the sheer nature and degree of the risks incurred to feed that greed? Well, that type of greed needs to be sent home hungry and locked out of the kitchen for sufficiently long to remind it of the staggering failure that this greed just delivered onto the dining table. It is, quite frankly, a rotting, stinking slice of humble pie, very well earned to boot! Eat that for a few months, and then we will see if there has been a change of heart, or not. - Kevin Mc
Footnote: Later today, even with 40% of shareholders supporting a split in roles as discussed above, Jamie Dimon got to keep his double job, as both CEO and Chairman. Again, hardly shocking. They also voted in approval of his salary for the past year, a "healthy" $23.1M. Cough. But I bet the fact that the FBI are now stepping in to dig through the matter and see if any Federal Securities laws were broken will make tonight's champagne taste slightly less sweet.