Today marks the second day of testimony before Congress from JP Morgan’s CEO and chief financial officer Jamie Dimon regarding a multi-billion trading loss the bank recently disclosed to investors.
Despite an increasingly heated debate about financial regulation and banking reform Dimon and other CEOs from the nation’s largest banks have insisted all along that oversight is not necessary, that financial institutions are capable of policing themselves. His testimony before the Senate Banking Committee today included the same naïve assessment—or is it “bad faith”?—despite the fact that risky investments with massive social and economic consequences has become standard operating procedure in the unchecked derivatives markets.
Dimon claimed the loss was an “isolated incident” and spent much of his time defending a pipe-dream vision of the economy called the “free market.” When Sen. Jeff Merkeley (D-OR) asserted that the government had already bailed out Chase Bank in 2008 from similar risky ventures, Dimon (falsely) asserted, “You’re factually wrong.”
Maybe Dimon’s wealth has insulated him from reality and the truth because he is dead wrong, and someone should put his impromptu lying in its context.
- Fact: JP Morgan/Chase was on the verge of bankruptcy in 2008 after it colluded with other banks, insurers, and credit agencies in packaging toxic assets and selling them on the derivatives market, all the while betting against its own toxic assets as a form of insurance fraud.
- Fact: The U.S. taxpayer bailout of its risky and unethical behavior amounted to $25 billion.
- Fact: The recent disclosure of a trading loss on he same derivatives market is likely to reach $5 billion, proving beyond a reasonable doubt that JP Morgan continues its pattern of risky and unethical behavior.
- Fact: The U.S. needs serious financial regulation and banking reform. Without such efforts financial institutions like JP Morgan and their lying-for-a-living CEOs will continue to erode the economy, our trust in one another, and the social fabric as well.