Jamie Dimon On Meet The Press: We Were 'Dead Wrong' To Dismiss Trading Concerns

NEW YORK -- The CEO of JPMorgan Chase, which disclosed a $2 billion loss last week, said he was "dead wrong" when he dismissed concerns about the bank's trading last month.

CEO Jamie Dimon said he did not know the extent of the problem when he said in April that the concerns were a "tempest in a teapot." After the bank reported the trading loss, investors shaved almost 10 percent off the bank's stock price.

"We made a terrible, egregious mistake," Dimon said in an interview that aired Sunday on NBC's "Meet the Press." `'There's almost no excuse for it."

The $2 billion loss came in the past six weeks. Dimon has said it came from trading in so-called credit derivatives and was designed to hedge against financial risk, not to make a profit for the bank.

Dimon said the bank is open to inquiries from regulators. He has also promised, in an email to the bank's employees and in a conference call with stock analysts, to get to the bottom of what happened and learn from the mistake.

Dimon told NBC that he supported giving the government the authority to dismantle a failing big bank and wipe out shareholder equity. But he stressed that JPMorgan, the largest bank in the United States, is "very strong."

Lawmakers and critics of the banking industry have seized on the $2 billion loss to say that banks still take too much risk more than three years after the financial crisis.

In this case, Dimon said, that's just what happened. He added that the bank had "badly monitored" the situation and taken on "far too much risk."

A piece of the financial regulation known as the Volcker rule would prevent banks from certain kinds of trading for their own profit. Dimon has said the trading involved in the $2 billion loss would not have fallen under the rule.

Rep. Barney Frank, D-Mass., told ABC's "This Week" that he hopes the final version of the Volcker rule will prevent the type of trading that led to the massive loss at JPMorgan.

Dimon did take a moment to combat his anti-regulation reputation, saying JPMorgan Chase backed "70 percent or so of Dodd-Frank," while also reiterating his support for policies that would wind down failing big banks, rather than provide them with federal bailouts. JPMorgan Chase received $25 billion in TARP funds in the wake of the financial crisis.

Dimon conceded to NBC that the bank "hurt ourselves and our credibility" and expects to "pay the price for that." Asked what the price should be, Sen. Carl Levin, D-Mich., said that banks will lose their fight to weaken the rule.

"This was not a risk-reducing activity that they engaged in. This increased their risk," Levin told NBC.

"So we've got to be very, very careful that the regulators here are not undermined by this huge effort to weaken the rule by putting in a huge loophole" that includes the trading involved in the JPMorgan loss, he said.

Addressing public anger toward Wall Street, Dimon said he wants a more equitable society and does not mind paying higher taxes. But he said attacking all of business is "very counterproductive."

Check out Jamie Dimon's history of railing against regulations:

Loading Slideshow

• Trading Loss 'Puts Egg On Our Face'

  Dimon said JPMorgan Chase's unexpected $2 billion loss on credit trades in May "<a href="http://www.huffingtonpost.com/2012/05/10/jpmorgan-chase-london-whale_n_1507662.html?ref=business" target="_hplink">puts egg on our face, and we deserve any criticism we get</a>."

• Regulation 'The Nail In Our Coffin'

  In March 2011, Dimon expressed his fear over new regulations, warning that higher capital requirements would be "pretty much the nail in our coffin for big American banks," according to the <a href="http://www.ft.com/intl/cms/s/0/3157bcbe-5b05-11e0-a290-00144feab49a.html?ftcamp=rss#axzz1IB5kVGLG" target="_hplink">Financial Times</a>.

• Losing Liquidity

  Warning that limiting proprietary trading would also affect market making, <a href="http://www.cnbc.com/id/45986077/Jamie_Dimon_Regulators_Undermining_Economic_Objectives" target="_hplink">Dimon was quoted by CNBC</a>, "The United States has...the most liquid [capital markets in the world]. If you lose liquidity because you lose market making, you cost investors money."

• 'Little To Do With Financial Crisis'

  "Proprietary trading had very little to do with the financial crisis," <a href="http://www.gurufocus.com/news/159099/interview--jpmorgan-ceo-jamie-dimon-on-regulation-volcker-rule-some-of-the-global-regulations-are-unamerican)" target="_hplink">Dimon told FOX Business Network Senior Correspondent Charlie Gasparino</a> in January, adding that "you can't even make markets for your clients" with the Volcker Rule.

• Volcker 'Doesn't Understand'

  "Paul Volcker by his own admission has said he doesn't understand capital markets," <a href="http://dealbook.nytimes.com/2012/04/06/what-volcker-rule-could-mean-for-jpmorgans-big-trades" target="_hplink">Dimon told FOX Business.</a> "He has proven that to me."

• Volcker Rule Too Narrow

  in February, Dimon asserted the Volcker Rule had been written too narrowly. "If you want to be trading, you have to have a lawyer and a psychiatrist sitting next to you determining what was your intent every time you did something," he was quoted as saying in <a href="http://news.businessweek.com/article.asp?documentKey=1377-aIjS6U8zr2Z8-1PEFKF7I5P2SI88Q43D587IV8L" target="_hplink">Businessweek</a>.

Comments

[BillKen]

02:45 AM on 05/15/2012

Damage control, damage control, fess up, fess up
Semper Fi

[BillKen]

02:34 AM on 05/15/2012

What's the reward for this failure, there's got to be a gigantic bonus lurking somewhere
in the wings or will we see change, I would hold my breath but it's not worth dying for.
Semper Fi

[Schmice]

01:09 AM on 05/15/2012

He is a lying liar. It was no mistake. They knew exactly what they were doing. They just tried to hedge their bets and lost $2 billion dollars when they bet wrong. To call it a mistake might make it seem that it was an individual lapse instead of a systemic problem which needs to be addressed and regulated. Hasn't anybody on the Republican side of aisle learned anything?

[BillKen]

02:41 AM on 05/15/2012

Sounds something like describing torture as enhanced interrogation. I understand a mistake, what I'm waiting for is the punishment for making the mistake, let's see some
consequences and maybe a lesson or two will be learned.
Semper Fi

[cowbore]

09:31 PM on 05/14/2012

So which is it Huffpo and Dimon? "I" made a mistake? or "We" made a mistake? And this is "Almost"? inexcusable? They sure do know how to share the blame when needed to reduce personal responsibility.

[nypapajoe]

09:01 PM on 05/14/2012

Wait until the other financial houses start exposing their financial loses! The republicans refused to take action and were told by Prof. Warren that without regulations the financial sector will fail again! Well here it is! Republicans you can't blame Obama or the socialist No, these are your Boys up to their old games, who is gonna bail them out now? The Koch brothers? Rush, Palin........

[filo]

08:02 PM on 05/14/2012

You have been wrong about a LOT of things Jamie.

This is the least of it.
Just retire already. You have more money than you could spend in several lifetimes.

How much is enough?

[Sum Wong]

10:33 PM on 05/14/2012

Why should he? NObama flushed in excess of 1 trillion dollars of OUR MONEY down the toilet and he got to brag about it. Didn't see you ask NObama to "retire already", did you. 2 bil is spare change compared to 1+ tril.

[blaze]

01:30 PM on 05/15/2012

You are Sum Wong about that. Tell me about the $7.5 Trillion Bush flush.

[TiredOfNo]

07:59 PM on 05/14/2012

So, I guess he should just resign and go pick up his kick-back.................

[onionboy]

07:22 PM on 05/14/2012

Translation: "I pretty much just talk out of my a** 90% of the time".

[diabeticdeath]

07:09 PM on 05/14/2012

after all the obama regulations , problems still happen. whats up barry ?????looks like another liberal takeover has failed

[mortrefuge]

07:32 PM on 05/14/2012

Your side still won't allow any regulation to be implemented.

[Doug Cain]

07:42 PM on 05/14/2012

you funny

[fgcilord]

07:06 PM on 05/14/2012

NBC SHOULD FIND SOMEONE ELSE TO TAKE THE DUTY OF ANCHORING MEET THE PRESS, BECAUSE, DAVID GREGORY IS INEPT AND IS WAY OVER HIS HEAD TAKING OVER THIS PROGRAM. THE MAN IS THE LAMEST ANCHOR OF ALL TIMES. HE ASKES STUPIDLY LAME QUESTIONS TO HIS GUESTS. IS THIS WHAT HE LEARNT IN JOURNALISM SCHOOL OR DID HE EVER ATTENDED ANY? WHAT A JOKE.

[filo]

08:06 PM on 05/14/2012

Gregory is no Tim Russert, that's for sure.

P.S. Turn off the caps lock please.

[blaze]

01:36 PM on 05/15/2012

Russert was bad, as well.

[fgcilord]

07:16 PM on 05/22/2012

Left it on for emphases; Of cause I was ticked....

[LickMyDecalsOffBaby]

06:43 PM on 05/14/2012

George and Barbara Bush owe this country an apology for producing George Dubya.

[blaze]

01:37 PM on 05/15/2012

A seriously Beefheartian statement.

[ggs83]

06:37 PM on 05/14/2012

I listened to Jamie Dimon on Meet the Press and am trying to confirm what I heard even though I must have heard wrong: To paraphrase, it sounded like Dimon said that he was not supporting Dems including the President because they were crticial of Wall Street, and Wall Street is where all is created". Did anyone else hear that?

[rc65]

06:36 PM on 05/14/2012

Or as Rick Perry would say, "Oops".

[exmate]

06:34 PM on 05/14/2012

They realized that they were 'Dead Wrong' to dismiss trading concerns when when there was a big loss instead of a big payoff.

[Carnac]

06:27 PM on 05/14/2012

The CEO of Best Buy resigns over an affair. The Chairman of Best Buy resigns over knowing about the affair and not reporting it. The CEO of Yahoo resigns over his resume. The CEO of JP Morgan turns a blind eye to $2b in illegal loses and stays at the helm.