Oh noes, everyone, terrible news: Wall Street is now officially leaderless in its fight to protect the American economy from the horrors of regulation.
That is according an alarming report on Tuesday from Bloomberg, which says that JPMorgan Chase CEO Jamie Dimon, Wall Street's de facto champion, is having a hard time making his voice heard these days. Apparently the egg covering his face after his bank lost $6 billion, give or take, on dumb credit-derivative bets has formed a mask-like crust that even Dimon's superhuman levels of hot air cannot penetrate:
"What you're seeing in the financial-services industry is a lack of any kind of credible statesmen," said Rakesh Khurana, a management professor at Harvard Business School in Boston. Dimon's diminished ability to defend the industry publicly "basically leaves a vacuum," he said.
This is just so incredibly important for Wall Street right now, because everybody in America hates banks, and politicians occasionally say hurtful things about banks, and there's a risk that those politicians might end up regulating banks a smidgen more than usual. Remember, regulation is bad because it will send all of America's bankers and banking customers to China or somewhere else where all people love banks all the time, and then our economy will die forever.
This is essentially the message that Jamie Dimon -- who gained stature during the financial crisis by virtue of not being completely inept -- has been spreading loud and long to anyone who will listen for the past few years.
Clearly other Wall Street CEOs aren't up to that task: Bank of America CEO Brian Moynihan is in charge of what may be America's most-hated bank and is busy trying to stanch the bleeding from bad mortgages. Citigroup chief Vikram Pandit can't even get his own pay plan approved. Then there's Goldman Sachs CEO Lloyd Blankfein, who is busy just trying to get people not to think of his bank as an evil Vampire Squid any more.
Without Jamie Dimon to speak for this collection of sadsacks, Bloomberg worries what will become of the financial services industry? An actual representative of the financial services industry, the CEO of the Financial Services Forum, tells Bloomberg it's really not a big deal. But Bloomberg finds some people who think it is a very big deal indeed:
Still, the lack of a statesman leaves the industry vulnerable, said Greg Donaldson, chairman of Evansville, Indiana-based Donaldson Capital Management LLC, which oversees $580 million.
"The banks have no moral authority at the moment," Donaldson said. "Jamie Dimon had it, but that's done. The government is piling on the banks. They're just being hammered, and it doesn't help our economy. Somebody has to fight the damn thing."
Yes, somebody has to do some fighting, although the banks do seem to be soldiering on, partly by nearly doubling their congressional lobbying to more than $61 million last year, from $32 million in 2006, according to Bloomberg. And that lobbying onslaught is bearing fruit in weaker and muddled regulations. And there is an entire industry of bank enablers, such as Rochdale Securities analyst Dick Bove, who recently warned that financial regulation could cause the next crisis, of all things.
Meanwhile, Dimon doesn't actually seem to be behaving any differently these days, despite the London Whale debacle and a mountain of other legal and regulatory problems. He still blames you and your bank-hating ways for the sluggish economy. He still doesn't think we should blame the big banks for the financial crisis, and he will straight-up punch you, or at least carpet-bomb you with f-bombs, if you disagree with him.
If anything has changed at all, maybe it is that Wall Street's "moral authority" has been eroded just enough, after the financial crisis and the Libor scandal and the London Whale debacle and on and on, that regulators will no longer swallow Dimon's bullshit quite as readily. That would actually be a good thing.
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