Jamie Dimon, CEO of JP Morgan Chase, is going to be grilled by a Senate Committee today. Among other things, he'll be asked to explain how JPMorgan Chase managed to lose more than $2 billion in risky trades. That's billion with a B.
What I want to know is why does Dimon still have a job, let alone bonuses and benefits that would keep a small country afloat for years? Why is there no regulation and where does the buck stop anyway?
I can't watch the hearings live today, but I'll be checking on how they went when I get home tonight and I sure hope that there are a few ethical senators left to call a spade a spade. Here are a few things I know for sure.
- Nobody is worth the kind of obscene pay packet Jamie Dimon and his ilk receive, no matter how brilliant they are at creating arcane financial instruments and manipulating markets.
- Corporate CEO's are not job creators. The little people are. The American economy is fueled by millions of little people buying the goods and services they need to get by every day. When the little people have money they buy stuff and the economy booms and more jobs are created. So why are we giving corporations and rich people tax breaks at the expense of the real job creators?
- Government is not a dirty word . Regulation is a necessary tool to insure fairness and confidence in the markets. Removing the firewall between banking and brokerage put in place by FDR has been a disaster. Time for the Federal Government to rebuild it.
Jamie Dimon is going to say that this was an isolated incident and investors were not hurt and so on and on, but the bottom line is that a financial system which does not create real value is useless and vulnerable to corruption.
These guys do not create jobs. They move arcane financial instruments around like carnival con men working a shell game. The buck needs to stop somewhere. I don't see why Jamie Dimon's office isn't a good place for responsibility to begin.
Let's see what happens today in Washington.
afternoon update: Click here for a pdf of Dimon's prepared remarks about what he claims was an " isolated incident." No surprises here.