Thursday, June 2, 2011

Jamie Dimon: Underlying Dynamics for the Economy Strong

JPMorgan CEO Jamie Dimon is upbeat on the prospects for the U.S economy, reports Reuters. He told investors Thursday at a Sanford C. Bernstein investor conference that pessimism is overdone and the economy is actually "getting stronger."

"The underlying dynamics are pretty good, pretty broad-based and getting stronger, not weaker," said Dimon.

So what's the deal between Dimon's view and the latest economic data?

Erratic Federal Reserve money printing.

Anybody who follows money data closely knows that despite all the hype over QE2, overall money growth has been erratic. This means there are pockets of strength and pockets of weakness. Since the big banks are less likely than small banks to be stashing money in excess reserves (got this info directly from a Fed economist) and are more likely to be lending it out, the customers of big banks are experiencing more of  a boom phase in the economy. That's what Jamie Dimon is seeing. His bank, JPMorgan Chase, is putting money out on the street. What happens from here to the economy will depend on whether more or less money gets out on the street from here, and I don't think even Bernanke has a clue as to what will happen short-term--given the mad tools he has created that have made control of the money supply more complex and in many ways uncontrollable.


  1. Why wouldn't he be upbeat! We (the taxpayers) are on the hook for all his mistakes. Grrrr!

  2. You look at all these dizzying money supply categories (M1, M2, MZM etc. etc.), numbers and all I can think of is: ""if God wanted to punish someone, He would make him mad
    first". Clearly the Keynesians are doomed forever to rot in their crazy monetary theories.

  3. Is "economy strong" the same thing as "army strong"? I could see the treasury and fed putting out propaganda using that as the tagline. LOL

  4. Believe it or not, he's quite right, if you take the 'underlying dynamics' to be the productive economy with the unproductive dis-economy sitting on top of it, bullylike, rubbing snot on its face.

  5. OK. So here's the fly in the ointment.

    His bank has no money, zero, zip. It has ones and zeros on it's computers - worthless fiat - a global mirage. They actually had to change the laws so that he can avoid marking to market all the junk he is holding. If the true valuation of his assets were known, his bank would have already disappeared in a mega implosion.

    What's the boy gonna say? If he says his bank is in the dumper with no hope of getting out, he only hastens his day of reckoning. The only thing "getting stronger" is his line of BS, and as my father used to say, "The worst thing that can ever happen to a man is he starts to believe his own BS."

    He's doomed. He knows he's doomed. We know he's doomed. The world knows he's doomed. Kick the can big fella...kick the can.

    Turns out the "too big to fails" are just too stupid not to.