Senators Fawn Over JPMorgan CEO After Massive Trading Debacle

[Nbadan]

Senators turned the Dimon cross-examination into a coronation, and exposed the extent to which elected officials still feel compelled to genuflect to powerful financial interests...


Senators Fawn Over JPMorgan CEO After Massive Trading Debacle
His exchanges with GOP senators were even more saccharine. Sen. Jim DeMint (R-SC) — a tea party hero — gave Dimon a full pardon. “I really appreciate you voluntarily coming in to talk with us,” he said. “It is important that we talk about things happening in the industry. It helps us as we look forward and, hopefully, it will contribute to best practice scenarios in industry. I appreciate your emphasis on continuous quality improvement. We can hardly sit in judgment of your losing $2 billion. We lose twice that every day in Washington.”

Sen. Jerry Moran (R-KS) asked Dimon and his firm to be good corporate citizens, if only to avoid complicating conservative free market messaging. “How you managed JPMorgan is the business of your board of directors, your shareholders, but it does have consequences to those of us who believe in the free-market system, its value, its merit. I have the sense and I hope it’s the case that it is a responsibility you understand. behavior really matters in our ability to be an advocate for a free-market that creates jobs and economic opportunity and allows Americans to pursue the American dream.”

So concerned were the senators that increased regulations might burden Wall Street that in an exchange with Sen. Roger Wicker (R-MS), Dimon even offered to get neighborly with the people charged with policing his firm’s actions, to keep them well informed about financial regulatory issues.

“Me and lots of other folks, we’ll do whatever you want, we’ll even get apartments down here,” Dimon offered.

http://tpmdc.talkingpointsmemo.com/2012/06/jamie-dimon-senate-banking-committee-volcker-jpmorgan.php?ref=fpnewsfeed


I just threw up in my mouth...

[boutons_deux]

No surprise that a tea bagger darling like DeMent would love the tea baggers' 1% paymasters.

[boutons_deux]

http://assets.rollingstone.com/assets/images/blog_entry/1000x600/f833f5a0d6ae6c2ee6439cd4b068c784e211a98d.jpg

Senators Grovel, Embarrass Themselves at Dimon Hearing

If not for Oregon’s Jeff Merkley, who was the only senator who understood the importance of taking the right tone with Dimon, the hearing would have been a total fiasco. Most of the rest of the senators not only supplicated before the blowdried banker like love-struck schoolgirls or hotel bellhops, they also almost all revealed themselves to be total ignoramuses with no grasp of the material they were supposed to be investigating.

It would be one thing if this had been a bunch of hick congressmen from the plains asking a panel of MIT professors about, say, ozone depletion, or the potential dangers of nuclear fallout. But these were members of the Senate Banking Committee, asking Dimon questions as though he were an alien from another world: "Tell us, Mr. CEO, what is this ‘derivative trading’ to which you refer? How long has it been in use on your planet?" The whole tenor of the proceeding was incredibly embarrassing, and showed just how unlikely it is that you’ll ever get anything like real questioning in a Senate hearing when a) the level of general expertise among the members is so shamefully low, and b) the witness is a man who controls millions of dollars of campaign contributions.

http://www.rollingstone.com/politics/blogs/taibblog/senators-grovel-embarrass-themselves-at-dimon-hearing-20120615#ixzz1xyQZMD97

[fraga]

I watched the Daily Show's take on it...fucking hilarious to see all those Senators...who are major recipients from contributions from Chase just pretty much suckled at his Corporate teet...just shameful and embarrassing...wish I could embed that video...

[boutons_deux]

Why the Senate Won't Touch Jamie Dimon: How JPMorgan Props Up US Debt

The national debt is growing at $1.5 trillion per year. Ultra-low interest rates MUST be maintained to prevent the debt from overwhelming the government budget. Near-zero rates also need to be maintained because even a moderate rise would cause multitrillion dollar derivative losses for the banks and would remove the banks' chief income stream, the arbitrage afforded by borrowing at 0 percent and investing at higher rates.

The low rates are maintained by interest rate swaps, called by Willie a "derivative tool which controls the bond market in a devious artificial manner." How they control it is complicated and is explored in detail in the Willie piece here and Kirby piece here.

Kirby contended that the only organization large enough to act as counterparty to some of these trades is the US Treasury itself. He suspected the Treasury's Exchange Stabilization Fund, a covert entity without oversight and accountable to no one. Kirby also noted that if publicly traded companies (including JPM, Goldman Sachs and Morgan Stanley) are deemed to be integral to US national security (meaning protecting the integrity of the dollar), they can legally be excused from reporting their true financial condition. They are allowed to keep two sets of books.


Interest rate swaps are now over 80 percent of the massive derivatives market and JPM holds about $57.5 trillion of them. Without the protective JPM swaps, interest rates on US debt could follow those of Greece and climb to 30 percent. CEO Dimon could, then, indeed be "the guy in charge": he could be controlling the lever propping up the whole US financial system

http://truth-out.org/news/item/9876-the-jpmorgan-derivatives-propping-up-us-debt-why-the-senate-wont-touch-jamie-dimon

[boutons_deux]

Lawmakers Clash on Regulation at JPMorgan Hearing

"I am a little surprised by all of the hemming and hawing by my colleagues on the other side of aisle over a private business losing private money when the federal government continues to lose billions of taxpayer dollars every day," Representative Scott Garrett, Republican of New Jersey, said in an opening statement for the hearing before the House Financial Services Committee.

Michael Capuano, Democrat of Massachusetts, hurled blame at Republicans for introducing legislation to weaken new rules for Wall Street. In a tirade against Republican lawmakers, he argued that JPMorgan's trading blowup raises broader questions about the safety of Wall Street.

"I'm not outraged by this particular loss," he said, pushing regulators to say whether other big banks could take on similarly risky bets.

But the comptroller of the currency, Thomas J. Curry, and the general counsel of the Federal Reserve, Scott Alvarez, faced the toughest inquiries. The regulators are under fire for failing to catch the risky trades.

Under questioning from Representative Randy Neugebauer, Republican of Texas, each of the five regulators acknowledged that their agencies were unaware of the losses until media reports emerged in early April.

"I'm wondering how this was missed," said Representative Shelley Moore Capito, Republican of West Virginia. "Even with the matrix of communication, no one was catching it. Is the communication really working?"

In reply, Mr. Curry explained that "we were initially relying on the information available to the bank."

Mr. Alzarez concurred. "We have to rely on information we get from the organization itself," he said. "If that's flawed," he added, then regulators will have a problem.

http://mobile.nytimes.com/article?a=964370&f=23

[boutons_deux]

Study: Mega Bank JP Morgan Chase Receives A $14 Billion Annual Subsidy From The U.S. Government

JPMorgan receives a government subsidy worth about $14 billion a year, according to research published by the International Monetary Fund and our own analysis of bank balance sheets. The money helps the bank pay big salaries and bonuses. [...]

In a recent paper, two economists — Kenichi Ueda of the IMF and Beatrice Weder Di Mauro of the University of Mainz — estimated that as of 2009 the expectation of government support was shaving about 0.8 percentage point off large banks’ borrowing costs. That’s up from 0.6 percentage point in 2007, before the financial crisis prompted a global round of bank bailouts.

To estimate the dollar value of the subsidy in the U.S., we multiplied it by the debt and deposits of 18 of the country’s largest banks, including JPMorgan, Bank of America Corp. and Citigroup Inc. The result: about $76 billion a year. The number is roughly equivalent to the banks’ total profits over the past 12 months, or more than the federal government spends every year on education.

JPMorgan’s share of the subsidy is $14 billion a year, or about 77 percent of its net income for the past four quarters. In other words, U.S. taxpayers helped foot the bill for the multibillion-dollar trading loss that is the focus of today’s hearing.

http://thinkprogress.org/economy/2012/06/19/502311/study-jp-morgan-subsidy/

[boutons_deux]

JPMorgan’s Connections to the House Finance Committee

JPMorgan has two in-house lobbyists with connections to the House Financial Services committee.

Rick Lazio joined JP Morgan in 2004 as chief of government relations. He previously served as a congressman from New York from 1993-2000, and sat on the committee.

Tom Koonce is a lobbyist for JP Morgan and formerly a legislative director for Brad Miller, D-N.C., who sits on the committee.

There are also three former congressional staffers with committee ties at firms currently lobbying for JPMorgan:

Collins Lionel is a lobbyist at Jones, Walker et al., and a former staff member on the committee. JPMorgan hired the firm this year.

Nicholas Leibham, who works JPMorgan lobbying firm K&L Gates, was formerly an aide to Gary L. Ackerman, D-N.Y., another committee member.

Bart Gordon also works at K&L Gates. He's a former Democratic congressman from Tennessee who, back in the 1980s, sat on the committee.

JPMorgan's PACs and employees have so far given $168,000 to members of the committee. About 80 percent of that came from one of the bank's PACs.

JPMorgan's PAC and employees have been the second-largest contributors to committee chairman Spencer Bachus, R-Ala., since 1993, donating a total of $119,000 to the congressman's campaigns — $11,000 so far this election cycle. (These numbers don't include contributions to Super PACs or other outside groups.)

The committee's vice-chair, Jeb Hensarling, R-Texas, has received a relatively modest $50,000 from JPMorgan since 2003. Overall, commercial banks have been his largest campaign contributor.

Other big Republican career recipients include Steve Stivers of Ohio, who has only served since 2010 but has already received more than $70,000.

On the Democratic side, JPMorgan's PAC and employees have given ranking member Barney Frank, D-Mass., $84,500 since 1989, making them his 4th biggest donor overall.

JPMorgan is number one for Carolyn Maloney, D-N.Y., with more than $100,000 since 1993.

JPMorgan has two former SEC enforcement heads working for them now:

the company's general counsel is Steven Cutler, who headed enforcement at the SEC from 2001 to 2005.

They have also reportedly retained William McLucas from an outside law firm, another SEC enforcement director who spent two decades at the agency.

http://www.motherjones.com/politics/2012/06/jpmorgans-connections-house-finance-committee

[Wild Cobra]

Don't know what to say except there is a variety of things said. Anyone actually watch it, or are you lemmings just repeating what your masters tell you to?

C-Span: Senators and JP Morgan CEO (http://www.c-spanvideo.org/program/PMo)

DeMint's time is from 1:10:05 to 1:15:11.

[boutons_deux]

The finance sector OWNS and RUNS the govt, all levels, and the country.

[leemajors]

http://www.bloomberg.com/news/2012-06-18/dear-mr-dimon-is-your-bank-getting-corporate-welfare-.html