Page 60 - Monocle Quarterly Journal Vol 1 Issue 1 Q4

BANKING
“Obama is quoted as saying ‘First of all, JP Morgan is one of the best managed banks there is. Jamie Dimon, the head of it, is one of the smartest bankers we’ve got’”
President Obama and JP Morgan
Dimon himself admitted that “egregious mistakes” had been made in trading these positions. Up until the point at which the London Whale trade occurred, Dimon had a strong position at the negotiating table with macro-prudential organs of State, as well as with local regulators. No less than Barack Obama himself, president of the United States and one of the greatest advocates of reining in greed on Wall Street in the last one hundred years, came out in defence of Jamie Dimon after Whoopi Goldberg had publicly questioned Dimon’s ethics after the London Whale incident.
Obama is quoted as saying “First of all, JP Morgan is one of the best managed banks there is. Jamie Dimon, the head of it, is one of the smartest bankers we’ve got”.
is was not the rst time Obama had publicly stood up and made presidential statements in support of Jamie Dimon. Following JP Morgan’s disastrous decision to acquire Washington Mutual just prior to the Financial Crisis, Obama made the following public statement: “You know, keep in mind, though there are a lot of banks that are actually pretty well managed, JP Morgan being a good example, Jamie Dimon, the CEO there, I don’t think should be punished for doing a pretty good job managing an enormous portfolio.”
Irrespective, however, of the politics imbedded in special interests within Wall Street, and irrespective of the tight-knit relationship between Wall Street and both the Democratic and Republican parties, the 2012 London Whale event was a turning point following which regulators, investigators, Attorney Generals and prosecutors seem to have had carte blanche in their willingness to punish banks.
In the four years from the start of 2012 through to the close of 2015, JP Morgan was ned, by the Department of Justice, by the Board of Governors of the Federal Reserve, by the Treasurer of the United States, by the States of California, Delaware, Illinois, Massachusetts and New York, and by many other extensions of government, a total amount in excess of USD 29.6 billion. is represents – based on JP Morgan’s nancial statements for the four years ending 31 December 2015 – an annual of 26.4 percent of after-tax earnings.
is means that should JP Morgan have wished to reward shareholders over the past four years with dividends, they would have had to do so
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