Did Jamie Dimon break a mirror or something? Because his bank, JPMorgan, once less fallible than the Pope, is suddenly having a terrible run of luck.
The bank's stock price was hit by a series of blows on Tuesday -- including a fresh scandal that raised the specter of Enron -- even as the rest of the stock market rallied.
The biggest blow was probably a New York Times story that the bank pushed mutual-fund clients into its own brand of mutual funds, which performed poorly and charged high fees. The story might make you think that maybe JPMorgan Chase cares only about money and not its clients! And you'd be right.
But wait, there was more: The bank is also the subject of a probe by the Federal Energy Regulatory Commission into charges that it manipulated power markets in California and the Midwest, the Financial Times writes:
The electricity investigation involves whether JPMorgan's bidding strategies extracted "inflated" or "excessive" payments from two wholesale power markets serving California and several Midwest states. The bank's commodities business owns or has rights to output from several electric generators.
If charges of power-market manipulation sound familiar to you, then you win the prize for remembering the Enron scandal.
JPMorgan says it is no Enron, that it is working with FERC and that it complied with the law.
As is so often the case, we might not even know about this investigation at all if there were not emails involved. Except, sadly, JPMorgan is refusing to give FERC its emails about the power market, claiming some sort of privilege.
In trying to get the a court to convince JPMorgan to cough up its emails, FERC released one email it does have, which involves an executive in the bank's commodities group telling the head of the group, Blythe Masters, that he would deal with regulators, "but it may not be pretty."
If the name "Blythe Masters" sounds familiar to you, then you win the prize for remembering the history of the financial crisis and how Masters masterminded the credit derivatives that nearly destroyed all of finance.
I've said it before and I'll say it again: Vampire Squid Goldman Sachs gets all the bad publicity, but Great White Whale JPMorgan is potentially far more dangerous.
To add insult to injury, rock-star bank analyst Meredith Whitney on Tuesday cut her rating on JPMorgan stock to "hold" from "outperform." The stock ended a shortened trading day on Tuesday slightly lower, while the rest of the market jumped.
And all this comes after the bank's blockbuster $2 billion, going on $9 billion, loss in credit derivatives. All that touch of unpleasantness has done is knock the stock price back, ruin the firm's quarterly earnings and force Dimon to shuffle his appointment calendar for a series of gentle Q&A sessions with lawmakers. Small potatoes, say the bank's defenders. JPMorgan loses money like that in its couch cushions.
After a while all this stuff starts to add up, though, making Jamie Dimon's Fourth of July increasingly unpleasant.
But Dimon should buck up, maybe: At least he's not his Barclays counterpart Bob Diamond, who is actually losing his job over his bank's errors. Dimon's job still seems perfectly safe. For some reason.
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