Most bankers are not the unethical and blindly greedy creatures that politicians and the media make them out to be; and there is no doubt that without the productive activities of the banking sector, no other industry in our nation would be able to survive or thrive. But that does not mean there isn't a ghost in the machine.
In the diplomatic language of Treasury communications, Mr. Geithner has just told Jamie Dimon to resign from the New York Fed board. It looks bad -- and it is bad -- to have him on the board of this key part of the Federal Reserve System at a time when his bank is under investigation with regard to its large trading losses and the apparent failure of its risk management system. If Mr. Dimon resigns, that is a major humiliation and recognition -- at the highest levels of government -- that even the country's best connected banker has overstepped his limits. If, as seems more likely, Mr. Dimon stays in place, that would be a great victory for the big banks -- and a reminder of who is really in charge of the country.