22 Thursday Apr 2010
Simon Johnson and James Kwak, co-authors of 13 Bankers and co-founders of Baseline Scenario discuss the financial crisis and the need to reform the system. From Crooks and Liars: Vodpod videos no longer available.
20 Tuesday Apr 2010
Posted in bailout, economy, financial reform, financial regulation, Obama, Politics, too big to fail, Wall Street
Tags
Baseline Scenario, blackmail, German newspaper, interview, Jamie Dimon, JPMorgan Chase, Simon Johnson, The Most Dangerous Man in America, White House visitor log
In an April 3 post at Baseline Scenario, Simon Johnson called JPMorgan Chase CEO Jamie Dimon “The Most Dangerous Man in America.” Johnson wrote:
“There are two kinds of bankers to fear. The first is incompetent and runs a big bank. This includes such people as Chuck Prince (formerly of Citigroup) and Ken Lewis (Bank of America). These people run their banks onto the rocks – and end up costing the taxpayer a great deal of money. But, on the other hand, you can see them coming and, if we ever get the politics of bank regulation straightened out again, work hard to contain the problems they present.
The second type of banker is much more dangerous. This person understands how to control risk within a massive organization, manage political relationships across the political spectrum, and generate the right kind of public relations. When all is said and done, this banker runs a big bank and – here’s the danger – makes it even bigger.
Jamie Dimon is by far the most dangerous American banker of this or any other recent generation.”
Following an interview with German newspaper Welt am Sonntag on Sunday, that should be amended to read “the most dangerous man in the world” as Dimon issued this not-so-veiled threat on the possibility of stricter bank regulations:
“When profits fall too sharply then capital will move somewhere else, where there is more money to be earned, for example non-regulated markets. The question is, is that what regulators want?”
Blackmail, anyone?
“[Dimon] also said the banking industry could do with more influence on politicians.”
More influence? According to the White House log, since October 30, 2009 Mr. Dimon has made 8, count ‘em 8, visits. What do you want to do, Jamie? Move in?
04 Sunday Apr 2010
Tags
13 Bankers, Baseline Scenario, Debt Disaster Ahead, How Washington Abetted the Bank Job, Jamie Dimon, Market Oracle, McClatchy, Moody's board, New York Times, Politico, Reuters, Robert Reich, Simon Johnson, Sniveling Scamster, The Fed in Hot Water, The Most Dangerous Man in America, Thomas Hoenig, Timothy Geithner, Wall Street cabal, Zero Hedge
The constraints of time, due in large part to my newly-arrived copy of 13 Bankers, doesn’t allow extensive commentary on any of these posts from around the financial blogosphere, but all are deserving of a closer look:
Speaking of 13 Bankers, co-author Simon Johnson has a piece at Baseline Scenario on how a combination of political savvy and public relations acumen make JPMorgan Chase CEO Jamie Dimon “The Most Dangerous Man in America.”
Mike Whitney’s “Timothy Geithner is a Sniveling Scamster” at The Market Oracle describes how President Obama’s new mortgage modification program is “just another stealth bailout” for the banksters.
Tyler Durden at Zero Hedge comments on Kansas City Fed President Thomas Hoenig’s extensive interview with Shahien Narisirpour of the Huffington Post.
Robert Reich’s “The Fed in Hot Water” on the belated admission of its taking tens of millions of bad loans off Bear Stearn’s books in order to facilitate their takeover by JPMorgan Chase.
Susan P. Koniak, George M. Cohen, David A. Dana and Thomas Ross in a New York Times op-ed entitled “How Washington Abetted the Bank Job” on the D.C buck-passing in regards to the regulators who were either incompetent or complicit (I choose the latter) in the Lehman Brothers Enron-like bookkeeping scam.
Speaking of inept, incompetent, or complicit so-called regulators, a McClatchy article asks, “Where was Moody’s board when top-rated bonds blew up?”
Herbert Lash at Reuters on the “Wall Street cabal” blocking derivative reform.
Finally, Rick Berman at Politico on the “Debt Disaster Dead Ahead.”
03 Saturday Apr 2010
Simon Johnson, MIT professor, Huffington Post contributor, co-founder of Baseline Scenario, and author of the new book 13 Bankers, on why it is imperative that “Too Big To Fail” becomes a thing of the past:
“You can’t have a market economy if some people have get out of jail free cards.”Vodpod videos no longer available.
26 Friday Mar 2010
Posted in bailout, financial reform, financial regulation, Politics, Wall Street
Simon Johnson at Baseline Scenario sheds light on Sen. Dodd’s proposed financial reform legislation, and it’s more of the same old, same old we’ve come to expect from Washington—the appearance of doing something while actually doing nothing:
“…officials are lining up to solemnly confirm that “too big to fail” will be history once the Dodd bill passes. But this is simply incorrect. Focus on this: How can any approach based on a US resolution authority end the issues around large complex cross-border financial institutions? It cannot.
The resolution authority, you recall, is the ability of the government to apply a form of FDIC-type intervention (or modified bankruptcy procedure) to all financial institutions, rather than just banks with federally-insured deposits as is the case today. The notion is fine for purely US entities, but there is no cross-border agreement on resolution process and procedure – and no prospect of the same in sight.
[…]
Why exactly do you think big banks, such as JP Morgan Chase and Goldman Sachs, have been so outspoken in support of a “resolution authority”? They know it would allow them to continue not just at their current size – but actually to get bigger. Nothing could be better for them than this kind of regulatory smokescreen. This is exactly the kind of game that they have played well over the past 20 years – in fact, it’s from the same playbook that brought them great power and us great danger in the run-up to 2008.
When a major bank fails, in the years after the Dodd bill passes, we will face the exact same potential chaos as after the collapse of Lehman. And we know what our policy elite will do in such a situation – because Messrs. Paulson, Geithner, Bernanke, and Summers swear up and down there was no alternative, and people like them will always be in power. If you must choose between collapse and rescue, US policymakers will choose rescue every time…
Once you understand that the resolution authority is an illusion, you begin to understand that the Dodd legislation would achieve nothing on the systemic risk and too big to fail front.
On reflection, perhaps this is exactly why the sponsors of this bill are afraid to have any kind of open and serious debate. The emperor simply has no clothes.”
Desperado's Outpost 