Not to put a fine point on it, Jaime Dimon’s appearance before the US Senate Banking Committee is proof positive that money buys power.
JPMorgan’s billion dollar loss in hedging elicited the lame excuse from the bank’s CEO that it was a one-time incident, and it won’t happen again.
Yet, it was this very Dimon who when his underlings alerted him to the bank’s exposure to tricky trading, dismissed it out of hand as ‘a tempest in a teapot’.
The panel of US solons treated him with kid gloves. After all for most of them, Dimon’s bank contributed handsomely to fill their campaign coffers. And as they knew, you don’t bite the hand that feeds you.
Dimon’s testimony was all vanilla fudge. Asked how one can avoid a repeat of a multi billion loss, other than ‘we’ll try harder not to repeat it’, elicited an ‘I don’t know’.
And the majority of senators on the panel echoed Dimon’s response. Nonetheless, you have to marvel at the passiveness of lawmakers who watcher over the health of America’s banking–the very banks which created the 2008 global recession. The damn fools have not an idea in their collective head but to bow and scape before campaign contributors, so that they can keep their jobs.
Still, when it comes to regulating the banks, Dimon does have opinions and a plan of action: no regulations at all; let the market work its wonders, thank you very much. And we all know how efficient this markets are!