Archive for the ‘Jamie Dimon’ Category
May Jamie Dimon Get His Wish
April 18th, 2010 | 
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Posted by Karl Denninger
Jamie Dimon, head of JP Morgan/Chase, was quoted as saying:
“When profits fall too sharply then capital will move somewhere else, where there is more money to be earned, for example non-regulated markets,” Chief Executive Jamie Dimon said in the German mass circulation Sunday paper Welt am Sonntag.
“The question is, is that what regulators want?,” said Dimon who heads the second-largest U.S. bank.
In the German interview, he also said the banking industry could do with more influence on politicians.
I have an excellent solution to Mr. Dimon’s request.
See, JP Morgan apparently was involved in a sordid little scheme in Jefferson County, Alabama, in which a number of politicians (and their friends) decided to hand some bribes around.
The outcome of that little scheme was that a sewer system replacement wound up costing the citizens of the county twenty five times what it should have, and much of that (improper at best and illicit in all probability) extra cost went to JP Morgan.
Oh, and in addition to the outcome of this job costing the fine citizens of Jefferson County far more than it should have (that county, by the way, includes the city of Birmingham) a number of politicians and others went to prison – either as a result of a plea of “guilty” or after a trial by a “jury of one’s peers”.
It is thus entirely fair (and not libelous) to say not that there was “alleged” bribery involved but that actual bribery took place. That is, this has now been proved in a court of law, at least with regards to those who have been convicted.
To date, however, nobody from JP Morgan has been indicted or charged in connection with this sordid little mess.
It therefore seems appropriate that the best resolution to Mr. Dimon’s request would be for him to be criminally charged as the head of JP Morgan/Chase in connection with the Jefferson County case and, upon conviction, he can be placed as a cellmate with the fine politicians from Jefferson County who are already serving a sentence, thereby gaining as much “influence” on those politicians as he is willing and able to absorb!
Of course Mr. Dimon, like all Americans, is entitled to the presumption of innocence, a jury of one’s peers, and a speedy public trial. I suggest that the jury should be comprised of citizens of Jefferson County, since they were inherently part of this sordid mess of a transaction and thus are most-certain Mr. Dimon’s “peers” for the purposes of any alleged offense.
Posted in Alabama, Corruption, Economic Crisis, Financial System, Fraud, JPMorgan, Jamie Dimon | 
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Dimon (JPMorgan) Fumbles For His Protective Plate
Dimon Fumbles For His Protective Plate
Posted by Karl Denninger
The one to be worn in his underwear, of course….
The gloves came off entirely Tuesday in testimony before the House Committee on Financial Services. David Lowman, Dimon’s lieutenant and the CEO of Chase’s home lending, argued strongly against a cornerstone of the Obama Administration’s plan to help homeowners facing foreclosure.
In his testimony (which can be read in its entirely in this pdf), Lowen sought to take the high ground in opposing the reduction of mortgage principal. “Like all loans, mortgage contracts are based on a promise to repay money borrowed,” he said. “If we re-write the mortgage contract retroactively to restore equity to any mortgage borrower because the value of his or her home declined, what responsible lender will take the equity risk of financing mortgages in the future? What responsible regulator would want lenders to take such risk?”
If would be nice if that was the issue, of course.
But Housingwire nails the true factor involved here, which I have been writing about for more than a year, just below:
For all of the bank’s moralizing, that’s not what’s at issue here. It’s the $448 billion in equity lines and other junior loans held primarily by the nation’s four biggest banks. If principal writedown is allowed, most of the equity lines involved will be wiped out if the property is underwater. In fact, the plan Obama announced last week for owners of such homes allowed only 10 cents to 20 cents on the dollar for second-lien holders.
Right now second lienholders are holding up mortgage modifications for underwater homes. Yet mortgage experts clearly have determined that a borrower whose mortgage is more than 115 percent underwater will likely walk away from the home. If the borrower walks away, the first lienholder forecloses and the second lienholder gets nothing anyway.
$448 billion times zero = how many times the Tier 1 Common Equity – or Tier 1 Capital – of those very same four large banks?
There’s your problem right there – if the actual market value of these seconds was to be recognized by the banks (that’s zero – bupkis – nil – bandersnatch – zilch) they would all be insolvent right here and now.
It’s nice to see this showing up in more and more publications.
Oh, and let’s add in their exposure to the nearly half-a-trillion in CDOs too, with nearly all of those worth a nickel on the dollar – at best.
Now if we could just get the attention of those pesky jackasses at the OCC, SEC – or even better, the FBI - we might get them to quit swilling coffee and donuts and instead start doing their damn jobs!
Posted in Banks, CDO, CDS, Corruption, Economic Crisis, Financial System, Fraud, JPMorgan Chase, Jamie Dimon |
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Tea Partiers Beware: Wall Street Is Now ‘Buying’ the GOP
In a Message to Democrats, Wall St. Sends Cash to GOP
The New York Times
If the Democratic Party has a stronghold on Wall Street, it is JPMorgan Chase [JPM 37.81 
-0.49 (-1.28%) 
] .
Its chief executive, Jamie Dimon, is a friend of President Obama’s from Chicago, a frequent White House guest and a big Democratic donor. Its vice chairman, William M. Daley, a former Clinton administration cabinet official and Obama transition adviser, comes from Chicago’s Democratic dynasty.
But this year Chase’s political action committee is sending the Democrats a pointed message. While it has contributed to some individual Democrats and state organizations, it has rebuffed solicitations from the national Democratic House and Senate campaign committees. Instead, it gave $30,000 to their Republican counterparts.
The shift reflects the hard political edge to the industry’s campaign to thwart Mr. Obama’s proposals for tighter financial regulations.
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Just two years after Mr. Obama helped his party pull in record Wall Street contributions — $89 million from the securities and investment business, according to the nonpartisan Center for Responsive Politics — some of his biggest supporters, like Mr. Dimon, have become the industry’s chief lobbyists against his regulatory agenda.
Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.
“If the president doesn’t become a little more balanced and centrist in his approach, then he will likely lose that support,” said Kelly S. King, the chairman and chief executive of BB&T [BBT 27.46 -0.05 (-0.18%) ] . Mr. King is a board member of the Financial Services Roundtable, which lobbies for the biggest banks, and last month he helped represent the industry at a private dinner at the Treasury Department.
“I understand the public outcry,” he continued. “We have a 17 percent real unemployment rate, people are hurting, and they want to see punishment. But the political rhetoric just incites more animosity and gets people riled up.”
A spokesman for JPMorgan Chase declined to comment on its political action committee’s contributions or relations with the Democrats. But many Wall Street lobbyists and executives said they, too, were rethinking their giving.
“The expectation in Washington is that ‘We can kick you around, and you are still going to give us money,’ ” said a top official at a major Wall Street firm, speaking on the condition of anonymity for fear of alienating the White House. “We are not going to play that game anymore.”
Wall Street fund-raisers for the Democrats say they are feeling under attack from all sides. The president is lashing out at their “arrogance and greed.” Republican friends are saying “I told you so.” And contributors are wishing they had their money back.
“I am a big fan of the president,” said Thomas R. Nides, a prominent Democrat who is also a Morgan Stanley [MS 27.04 -0.22 (-0.81%) ] executive and chairman of a major Wall Street trade group, the Securities and Financial Markets Association. “But even if you are a big fan, when you are the piñata at the party, it doesn’t really feel good.”
Roger C. Altman, a former Clinton administration Treasury official who founded the Wall Street boutique Evercore Partners, called the Wall Street backlash against Mr. Obama “a constant topic of conversation.” Many bankers, he said, failed to appreciate the “white hot anger” at Wall Street for the financial crisis. (Mr. Altman said he personally supported “the substance” of the president’s recent proposals, though he questioned their feasibility and declined to comment at all on what he called “the rhetoric.”)
Mr. Obama’s fight with Wall Street began last year with his proposals for greater oversight of compensation and a consumer financial protection commission. It escalated with verbal attacks this year on what he called Wall Street’s “obscene bonuses.” And it reached a new level in his calls for policies Wall Street finds even more infuriating: a “financial crisis responsibility” tax aimed only at the biggest banks, and a restriction on “proprietary trading” that banks do with their own money for their own profit.
“If the president wanted to turn every Democrat on Wall Street into a Republican,” one industry lobbyist said, “he is doing everything right.”
Though Wall Street has long been a major source of Democratic campaign money (alongside Hollywood and Silicon Valley), Mr. Obama built unusually direct ties to his contributors there. He is the first president since Richard M. Nixon whose campaign relied solely on private donations, not public financing.
Wall Street lobbyists say the financial industry’s big Democratic donors help ensure that their arguments reach the ears of the president and Congress. White House visitors’ logs show dozens of meetings with big Wall Street fund-raisers, including Gary D. Cohn, a president of Goldman Sachs; Mr. Dimon of JPMorgan Chase; and Robert Wolf, the chief of the American division of the Swiss bank UBS, who has also played golf, had lunch and watched July 4 fireworks with the president.
Lobbyists say they routinely brief top executives on policy talking points before they meet with the president or others in the administration. Mr. Wolf, in particular, also serves on the Presidential Economic Recovery Advisory Board led by the former Federal Reserve Chairman Paul A. Volcker.
Mr. Wolf was the only Wall Street executive on the panel and became the board’s leading opponent of what became known as the Volcker rule against so-called proprietary trading, according to participants. Such trading did nothing to cause the crisis, Mr. Wolf argued, as the industry lobbyists do now. (The panel concluded that the crisis established a precedent for government rescue that could enable big banks to speculate for their own gain while taxpayers took the biggest risks.)
Mr. Wolf and Mr. Dimon, who was in Washington last week for meetings on Capitol Hill and lunch with the president, have both pressed the industry’s arguments against other proposed regulations and the bank tax as well — saying the rules could cramp needed lending and send business abroad, according to lobbyists.
Both men are said to remain personally supportive of the president. But UBS’s political action committee has shifted its contributions, according to the Center for Responsive Politics. After dividing its money evenly between the parties for 2008, it has given about 56 percent to Republicans this cycle.
Most of its biggest contributions, of $10,000 each, went to five Republican opponents of Mr. Obama’s regulatory proposals, including Senator Richard C. Shelby of Alabama, the ranking minority member of the Banking Committee.
The Democratic campaign committees declined to comment on Wall Street money. But their Republican rivals are actively courting it.
Senator John Cornyn of Texas, chairman of the National Republican Senatorial Committee, said he visited New York about twice a month to try to tap into Wall Street’s “buyers’ remorse.”
“I just don’t know how long you can expect people to contribute money to a political party whose main plank of their platform is to punish you,” Mr. Cornyn said.
Posted in Banks, Corruption, Democrats, Economic Crisis, Financial System, JPMorgan Chase, Jamie Dimon, Republicans |
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