Thursday, December 10, 2009

The Rest of the Jamie Dimon Regulation Story

MSM has been running a story over the last few days that Obama's Favorite Banker, JPMorgan CEO Jamie Dimon, had said that we should “get rid of the concept of ‘too big to fail,’” and that he suggested that a new resolution authority — giving government more power to shut down or take over big banks — would make this possible.

I basically ignored the story figuring there had to be more to it, since Jamie Dimon isn't going to be regulated by some new superpower resolution authority.

Well, in a report about a Jamie Dimon speech at the Goldman Sachs U.S. Financial Services Conference , Simon Johnson fills us in on the "rest of the story" (My emphasis):
Mr. Dimon insists, at minute 23, that we should “get rid of the concept of ‘too big to fail,’” and he suggests that a new resolution authority — giving government more power to shut down or take over big banks — would make this possible. Unfortunately, he glosses over the “international coordination” issues that make this impossible to achieve in the foreseeable future.
In fact, Jamie doesn't seem to be sweating about any new regulations. Here's Simon, again:
His views on the pending legislative and regulatory reforms are not in the slides, but from about the 21st minute mark in the Webcast, he is quite candid. He doesn’t see major impact on his business from what is in the pipeline — e.g., any kind of progressive capital requirement that would force bigger banks to hold substantially more capital.

To the extent there is tougher consumer protection in new legislation, he says — rather bluntly — that the consumer will pay the price, not JPMorgan Chase.

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